Pay Day type loans for real estate agents

Coins, moneyIf you are not a real estate agent you might not find this interesting. Sometimes a real estate agent will work with a client for six months or more before getting paid. Agents get paid by their broker only after a successful closing of a home sale.  Sometimes everything falls apart shortly before the closing through no fault of the agent or the agent’s clients . . which is why I am writing this.

Some lenders find out when an agent has a closing and they start sending the agent emails that go something like this: “we specialize in empowering real estate professionals like you by providing commission advances on pending sales or listings.”

Even if you were not born yesterday you know that the interest rates of those “commission advances” are huge. If for some reason the expected commission never arrives it may take the agent awhile to pay back the money advance plus interest.

People who survive as real estate agents have a cushion in the bank before they start. We learn how to manage our money so we can pay our bills in between commission checks. We learn to set money aside from each check for income taxes.  Agents who do not make enough to pay their bills need to either lower their expenses or take on additional work.

Most real estate agents and Realtors® are independant contractors working on a 100% commission basis. It is exactly like being a gig worker.definitely not for everyone and some days I wonder if it is for me but after awhile I just got used to it.

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