Is offering cash back at closing legal?

[Anthony Banegas]

Hi everyone, I am a real estate agent in Southern California and have been interested in getting involved in wholesaling properties. My question is would it be legal to offer sellers cash back once the deal goes through? To be more specific, there would be no commissions involved in these deals so I would pay the seller money out of my own pocket and advertise this as an incentive.I have searched for this topic online and have had some mixed answers and wanted to see if someone might be able to provide a more clear and definitive answer. I wanted clarity before I went any further with this idea.

[Russell Brazil]

All exchanged money needs to be on the Closing Disclosure/ALTA/HUD. Exchanging funds related to the transaction outside of that would be illegal if a government backed loan is involved. If no government backed loan is involved, then it would depend on state statutes, but in most cases the answer will remain the same.