Sometimes, real estate agents can be in dire need of cash due to the delays in the closing of escrow. This delay can be fatal for their business especially if they have a new open house coming up. During these financial draught times, real estate cash advances can save the business, repute and personal finances of any real estate agent. Some people like to think that cash advances are just the payday loans of the real estate world, but that’s hardly true.
Cash advances cost much lesser than business loans or payday loans. Commercial factoring for real estate professionals including brokers and real estate agents, bring instant cash at flat rates. These are not “loans” because the agent and the broker can buy these instead of their business asset. It is like taking an advance on your immediate pending commission, hence the name!
In case of such cash advances, the real estate commission factoring business can charge the agent a flat rate of 10% of their pending commission. The agents can get 90% of their commission in cash instantly, and the company assumes the charge of receiving the pending amount from the settlement party. Both the buyer’s real estate agent and the seller’s real estate agent can enjoy the privilege of cash advances against their promised commissions.
The real estate commission factoring companies are rarely likely to check for credit records and your history of loans. When you are applying for an advance, all you will need is the listing documents or the closure documents, the documents representing your share of the price, ID proof and a brief record of your past performances. The real estate commission factoring companies have no interest in your loans and bank loans. They just need to know if the company will receive the advance you are taking right now.
This is excellent for people with low FICO scores. In fact, we have known agents with FICO scores as low as 400 to receive cash advances on their pending commissions, simply because they are great at their job. There are no long waiting periods for approval and application verification. You can receive money in less than 24 hours if all your documents are in order.
Do not worry! These companies value their client’s privacy. Your buyers or sellers will not get to know about your commission advance. These companies just need your broker to sign off on the application, so the commission you are about to receive goes to them this time.
The company typically offers few months (120 days) for closure. However, in case the deal goes south, you can always apply for an extension. That can cost you as less as $50 at some of the leading companies. As we have said before, commission advance is not expensive at all; you just need to find the right company you can trust. So window shop a little, invest a good amount of time researching the companies you have shortlisted and chosen the real estate commission factoring companies as per their client reviews.