| CONSIDERATIONS |
Commission Advance |
Bank Loan or Line of Credit |
| Free to apply |
X |
|
| High approval rate |
X |
|
| Fast process |
X |
|
| Long-term liability |
|
X |
| Impacts credit score |
|
X |
| Low credit score may be a problem |
|
X |
| Compound interest |
|
X |
| Additional collateral required |
|
X |
| Flexible use |
X |
|
- Free to Apply
Your bank may charge an application fee for due diligence, origination fees and service charges to establish your loan or line of credit. Credit cards may also charge annual fees (in addition to interest on unpaid balances). There is no fee to apply for a commission advance, perform due diligence or set up your account, and there are no account maintenance or service fees.
- High Approval Rates
Because of its flexibility of use and non-dependence on collateral or credit scores, and because commission advances are simply a tool for unlocking real estate commissions already earned, approval rates are generally very high for this type of financing.
- Faster Process
Business loans and lines of credit typically require weeks (or longer) to process. Additionally, there is a significant amount of paperwork to be submitted, including comprehensive lists of agency (and often your personal) assets, bank accounts, credit cards, etc. Even when you believe you have submitted everything, underwriters will often ask for additional documents, explanations or require that you prove you have satisfied previous loans, sold formerly-owned properties, and other items prior to approving (or worse, rejecting!) your business loan application.
By contrast, applying for a commission advance can be completed within a matter of 1-2 business days, or even faster. The online commission advance application can be completed within a few minutes, and will be seen immediately by our team so we can process the request, verify your information and determine the amount of commission advance that might be available to you immediately. Instead of waiting on transactions to close and brokers to make payouts, you can reinvest in your agency right away to:
- grow more quickly
- meet payroll or other expenses
- take care of unexpected costs
- undertake business-building marketing and advertising initiatives – and more!
- No Long-Term Liability
Bank business loans usually come in the form of long-term debt, whether taken as a true business loan or utilization of a business or home equity line of credit. Commission advances are not liabilities. Commission advances unlock assets (commissions earned but not yet received, or “accounts receivable”) without having to wait weeks or months for transactions to close and for brokers to make final payouts.
- No Impact to Credit Score
Any time you apply for credit such as a bank business loan (or personal loan), line of credit, credit card, etc., your credit score is impacted. Even having your credit checked can “ding” your business and/or personal credit score.
A commission advance is based on the credit worthiness of the commission being factored, not you or your agency. So there is no impact to your personal or business credit score when you apply for or receive commission advance financing.
