Final answer:
The $200 paid to brokers and salespeople for loan referrals by a mortgage banker is known as a referral fee. It's a common practice in finance where intermediaries are compensated for directing business to lenders or banks.
Step-by-step explanation:
A mortgage banker paying a fee of $200 to brokers and salespeople for each loan successfully closed for referring business is an example of a referral fee. This is a common practice in the financial industry where a finance company, like a bank or a lender, compensates third parties for directing potential clients to their services.
Finance companies, including those like Bank of America Merrill Lynch Dealer Financial Services, Chase Auto Finance, or Ford Motor Credit Company, often work with installment contracts and may pay referral fees to merchants or individuals who bring them business.
In the context of the mortgage industry, the primary loan market is where financial institutions make loans to borrowers, and the secondary loan market is where these loans are bought and sold among financial institutions.
The $200 fee in this scenario helps the mortgage banker acquire new customers through brokers and salespeople, thereby increasing her volume of closed loans which is lucrative for both the mortgage banker and the referring party.