New Referral Fee Option for Independent Dealers

On August 16, the Texas Department of Motor Vehicles (TxDMV) Board met and adopted rules related to the use of referral fees for independent motor vehicle dealers. Here is what you need to know as a licensed independent dealer on this effort: 

• An independent motor vehicle dealer may now offer a referral fee in cash or value to a customer who purchased a vehicle from the licensed dealer within the past four years.
• The referral fee may be contingent upon the new referred individual purchasing a vehicle, or a fee may be paid for the referral of a new potential customer.
• The referral fee agreement may NOT be used for financing as a part of an original retail installment contract agreement transaction (Ref. Texas Finance Code 348.403 and 348.404). 

The rule does not extend the option to offer a referral fee to:

• a franchised motor vehicle dealer;
• a wholesale motor vehicle dealer;
• a motorcycle dealer;
• a house trailer dealer;
• a trailer or semitrailer dealer; or
• an independent mobility motor vehicle dealer 

If you have any questions regarding the new referral fee option, please do not hesitate to contact us at (512) 465-4207.

Best,
Corrie Thompson
Enforcement Division Director
Texas Department of Motor Vehicles