Early Commissions - Get Paid NOW
Early commission payments are one way to make your cash flow more consistent. Here's how it works.
1. An advance company sends you a percentage of your commission before closing, typically 70-80%.
2. A fee is deducted from that percentage, based on the number of days remaining until the scheduled closing date.
3. If the commission amount and closing date don't change, you receive the balance at closing. If closing is delayed, additional fees may be deducted from the amount reserved.
All of the companies who pay advance commissions have slightly different policies. Some ask your broker-in-charge to pay them at closing, others prefer to be paid by the closing agent. Some require you submit more paperwork than others to apply for an account, or when requesting an advance.
All companies expect your broker-in-charge to verify contracts, and participate in other ways. Brokers are not responsible for repaying the advance if your closing doesn't happen, but they are required to withhold future commissions if you do not repay the funds. If a deal falls apart, most plans allow you to transfer your advance, attaching it to another contract.
Your typical costs range from 8%-12% of the commission, and most companies do have a minimum fee. If your closings take place consistently, the decrease in income might not make sense for you. But if you have five closings scheduled for December, and none for November, taking an advance on one or two might be a good way to ease the cash crunch.
Visit the Web sites below to learn more about the differences between advance commission plans. Be sure to read all pages carefully. If you find sites not listed here, I'd appreciate it if you would tell me about them.
1. An advance company sends you a percentage of your commission before closing, typically 70-80%.
2. A fee is deducted from that percentage, based on the number of days remaining until the scheduled closing date.
3. If the commission amount and closing date don't change, you receive the balance at closing. If closing is delayed, additional fees may be deducted from the amount reserved.
All of the companies who pay advance commissions have slightly different policies. Some ask your broker-in-charge to pay them at closing, others prefer to be paid by the closing agent. Some require you submit more paperwork than others to apply for an account, or when requesting an advance.
All companies expect your broker-in-charge to verify contracts, and participate in other ways. Brokers are not responsible for repaying the advance if your closing doesn't happen, but they are required to withhold future commissions if you do not repay the funds. If a deal falls apart, most plans allow you to transfer your advance, attaching it to another contract.
Your typical costs range from 8%-12% of the commission, and most companies do have a minimum fee. If your closings take place consistently, the decrease in income might not make sense for you. But if you have five closings scheduled for December, and none for November, taking an advance on one or two might be a good way to ease the cash crunch.
Visit the Web sites below to learn more about the differences between advance commission plans. Be sure to read all pages carefully. If you find sites not listed here, I'd appreciate it if you would tell me about them.
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