Finder's Fee

AAA

DEFINITION of 'Finder's Fee'

A commission paid to an intermediary or the facilitator of a transaction. The finder's fee is rewarded because the intermediary discovered the deal and brought it forth to interested parties. Depending on the circumstance, the finder's fee can be paid by either the transaction's buyer or seller.

Also known as "referral income" or "referral fee".

INVESTOPEDIA EXPLAINS 'Finder's Fee'

Often, the finder's fee may simply be a gift from one party to another, as no legal obligation to pay a commission exists. For example, let's examine a real estate transaction. Let's say that a friend is selling a property and you discover a potential buyer. If the transaction goes through, your friend may give you a small percentage of the sale, as a reward for finding the purchaser.

RELATED TERMS
  1. Real Estate Agent

    A person with a state/provincial license to represent a buyer ...
  2. Realtor

    A real estate professional who is a member of the National Association ...
  3. Medium Of Exchange

    An intermediary instrument used to facilitate the sale, purchase ...
  4. Middleman

    A slang term for an intermediary in a transaction or process ...
  5. Financial Intermediary

    An entity that acts as the middleman between two parties in a ...
  6. Open Listing

    A property listing that uses multiple real estate agents in order ...
Related Articles
  1. Home & Auto

    Can real estate agents give referral fees?

    Learn about the process, laws and guidelines of real estate agents paying other real estate agents for referrals and how brokers and licenses are involved.
  2. Home & Auto

    4 Types Of Home Renovation: Which Ones Boost Value?

    You think your updated house looks great, but potential buyers may not feel the same way.
  3. Home & Auto

    Uncover The Next Real Estate Hot Spot

    Real estate land speculation is a way to get in on a hot investment before a boom hits.
  4. Taxes

    Avoid Capital Gains Tax On Your Home Sale

    If you have property to sell and want to avoid capital gains tax, a Section 1031 exchange may be the answer.
  5. Entrepreneurship

    Find Fortune In Commercial Real Estate

    Investing in big buildings means big money - and bigger risks.
  6. Home & Auto

    Exploring Real Estate Investments

    Discover how owning properties can give you a roof over your head or a check in your pocket.
  7. Professionals

    What's the average salary of a bank teller?

    Read this article to find out more about average bank teller salaries, median hourly wage rates and potential future career prospects.
  8. Professionals

    What's the average salary of a business operations manager?

    Read about the average yearly salary of business operations managers, and find out which locations and industries offer the best pay for these professionals.
  9. Personal Finance

    What's the average salary of a loan officer?

    Read about the average yearly salary for a loan officer. Learn about what these professionals do and what determines their pay rate.
  10. Personal Finance

    What's the average salary of a bill collector?

    Start a new career in bill collections, and you may have job security with the potential growth that is expected in this industry.

You May Also Like

Hot Definitions
  1. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  2. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  3. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  4. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  5. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
  6. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), expressed as a single percentage number that represents ...
Trading Center