Even though you have just closed a real estate deal, receiving the commission you are entitled to for your hard work takes weeks or even months. While you have become accustomed to this disappointing and sometimes frustrating reality, the good news is it does not have to be this way.
Gone are the days when you need to put your life and its financial demands on hold while you wait for your real estate commissions to arrive. Real estate commission advances have become a very popular process, allowing a real estate agent to recover up to 95 percent and pay it back to the lender once received.
If you are part of the majority of real estate agents who dislike waiting to be paid for real estate deals that they closed, the commission advance process may be exactly what you need.
1. Pay bills
Lenders will not make exceptions for you just because you are a real estate agent waiting for a commission cheque to arrive. Debts such as credit cards, mortgages, heat, and hydro bills need to be paid and if you do not have the money to pay them, your credit score will suffer and you will end up paying more in penalties for late or missed payments in the long run.
Commission advances allow you to borrow an amount based on the commission that you are expecting with the understanding that you will pay back the amount in full once you get paid. Increasing this cash flow will allow you to pay your debts on time and not risk repercussions.
2. Quick process
Although you like to think otherwise, there may be instances where you need money before you receive commission for a closed deal. Lenders of commission advances understand this and for this reason the application process is quick and easy. Because real estate agents are able to provide concrete proof of closed deals and that they will have the ability to pay back the advance, no credit check is performed.
The application process is completed in 15 minutes on average and all that is usually required is identification, instructions regarding where to send the advance, and documentation that shows the total commission owed to you. Once these conditions are satisfied, advances can be received in as little as 2 hours.
3. Better than a bank loan
When you need to increase your cash flow right away, it may be tempting to take out a traditional loan but this will not assist you like a commission advance can. A loan requires a lot of documentation and it can often take days or weeks to get access to funds that you may need right away. Loans from banks can include excessive fees and interest rates can be high. You may also be required to include something like your home or vehicle as collateral.
Real estate commission advances are based solely on your closed deals and you can often borrow more than a traditional loan as a result, meaning you will be guaranteed to cover any and all outstanding costs and debts that you may have.
4. Stay competitive
The real estate industry is competitive and if you do not stay relevant, you will lose out on deals to other agents. Real estate agents have many out-of-pocket expenses such as office equipment, websites, business cards, vehicle expenses, heat and hydro at an office, and salaries of employees. A contributing factor to a real estate agent’s success is also marketing and advertising that entices potential clients to seek their services.
Without the money for these expenses a real estate agent has no chance of competing and earning people’s business. Commission advances can provide the funds to pay for these expenses that are instrumental in being relevant in a competitive real estate market.