Limited Function Referral Office Certification or LFRO is a designation for real estate licensees that aren’t members of the association of realtors, but want to hang their license with a broker that is a full realtor member. The implication is that the non-member agents is considered a “referral agent” and they are not expected to operate as an active agent. Instead, they are expected to refer their clients to “active” realtors on the team.
Once a salesperson is licensed with the Department of Real Estate, the salesperson is not required to join an association of realtors. Some licensees maintain their license as NBA or no broker affiliation. Salespersons must be affiliated with a broker to conduct business.
So, a salesperson might go hang their license with a broker, this is where there may or may not be a requirement. A broker is very likely to be a full realtor member with an association of realtors. Now, the distinction is the the association requires the broker’s salespersons to be full realtor members as well. It has nothing to do with the state. It’s a stipulation of the broker’s membership with the association of realtors. If the salesperson doesn’t sign up as a full realtor member then the broker will get a notice that they must either pay a fine, or the agent can be moved to LFRO designation upon Limited Function Referral Office Certification, or the licensee must be terminated from the broker’s employment. The obvious choice is for the salesperson to be moved to the LFRO referral agent status.
Occasionally, agents will inquire with Balboa Real Estateabout the 100% commission program. They ask whether or not they are required to be a member of the association of realtors. Our answer is that the agent is not required because we can have their DRE license active with our company and move the agent to LFRO referral agent status. However, when an agent begins to get busy, it would benefit them to pay dues to access a MLS and professional real estate forms.
