The real estate industry is an unpredictable one, where sales can come one after another or it could be dormant for a while. As a real estate agent, this does not help your cash flow situation, as you really have no control. This can increase stress, since you have to pay bills, pay employees and spend on marketing to attract new clients. This is where a real estate commission advance can help you and your business benefit. Let’s take a closer look at what it is and also what it isn’t.

1. What Is It?

Real estate agents depend on commissions. Sometimes, you need to wait for a while before you receive it. This is terribly inconvenient, as you can be feeling as if you are in limbo. After all, you have to carry on and there will be lots of expenses. A real estate commission advance company is a financial service where the agent can sell part of their (pending) commission for a fee. The agent will receive this portion from the company. It’s important to understand that this is not a loan. That being the case, there is no credit check.

2. The Advance Is Not A Loan

One thing to be clear on is that this advance is not a loan. This means the money an agent gets does not have to be repaid. There are also no fees upfront that have to be paid. Basically, you are selling a part of your commission. There is a flat fee, but this will only be paid after your sale closes. This way, you get your commission before you close the sale. The commission advance company buys a part of your commission from you. With a bank loan, there is monthly or daily interest.

3. There Are No Credit Checks

Credit checks can pose an obstacle that agents do not want to encounter. If applying for a line of credit or a bank loan, then there is no escaping this. Everyone is different, so there may be many agents who may not have the greatest credit scores. This can lead to being rejected, or simply be unacceptable when applying for a loan.

Apart from this, even when approved, a loan can take a while before the cash is received. This might not be acceptable to a real estate agent. A commission advance company can give you the funds within 24 hours after you submit an online application and the money can be sitting in your bank account the very same day, which is a much more attractive option.

4. What Underwriters Look For

When a real estate agent or broker submits an application, in general, there are some things that the underwriter looks for. They need to know that the agent who is requesting the advance is representing buyers and sellers (actively) in real estate transactions. They want to know how many transactions have been completed in the last six months and how many active ones are currently in the works. It is also preferable if there is at least one deal that is going to be closed within weeks.

Normally, the application is very straightforward and fast. This is helpful because you can solve your cash flow problems much faster than any other method. This gives you the ability to sort all finances without further delay so that you and any staff will be happy and can carry on focusing on growing the business.