Real Estate Commission Advance Guide

Commission Advances for Real Estate Agents and Brokers

Real Estate Commission Advances for Realtors

Real Estate Commission Advances for Realtors – In an unpredictable business like real estate, where sales ebb and flow throughout the year–it can be difficult to predict and control cash flow during the slow periods. Applying for a real estate commission advance can help reduce the stress of ongoing expenses, like paying bills and overhead fees, compensating your employees, and marketing and advertising your business to attract new clients.

While the industry has been around for the last several decades, real estate commission advances are still a new concept for many people. This article explains what real estate commission advances are, how realtors use them, and how they work.

“In the real estate business there are peaks and troughs of cash flow. If you are in a trough, you may need to realize fees in advance of the closing.”


In This Guide We Explain:

  • What is a real estate commission advance?
  • How is a realtor commission advance different than a bank loan?
  • What other types of financial options exist for real estate professionals?
  • When should I take out an advance on a real estate commission?
  • How does the advance work?
  • What does the application look like?
  • What are some real-world examples of commission advances?
  • What is a real estate commission advance?

First, let’s start with a definition: What is a Real Estate Commission Advance?

A commission advance for real estate agents is a financial service that allows a real estate agent or broker to sell a portion of their pending commission for a fee. In exchange, they receive a portion of their commission funds right away (often the next day) and the rest of what they are owed at closing. 

What is the Difference Between a Real Estate Commission Advance and a Bank Loan?

A real estate commission advance is not a loan, as it does not need to be repaid and there are no upfront fees. Think of it as selling a portion of your commission: In exchange for a flat fee (to be paid once your sale closes), which allows you to gain access to your already-earned commission prior to closing rather than waiting for it when you need money now. 

Unlike a bank loan which accrues daily and monthly interest, commission advance companies purchase a piece of your commission for a standardized, flat fee. When your sale closes, repayment of the advance happens automatically: there are no monthly payment to make.  

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Why not take out a bank loan?

Although bank loans and lines of credit are the more familiar options for most business owners, real estate agents and brokers may find that dealing with the bank is not the easiest or most practical solution. Banks usually require loan and line of credit applicants to present non-liquid assets, such as bonds, stocks, and real estate. These assets, used as collateral, guarantee that the applicant will have something of significant value with which to pay back the loan. While some agents and brokers may have no problem coming up with the necessary collateral to secure a loan, others may find this difficult.

Credit checks are not necessary for commission advances

Credit checks are another potential hurdle that real estate agents or brokers might face when applying for a bank loan or line of credit. Agents who recently started working at a different agency, have been late on a few payments over the years, or have a high credit utilization ratio may have credit scores that would be unacceptable on a loan application. Also, if your debt to equity ratio is high (because you have taken out a lot of loans already), banks may not be willing to extend you the amount of credit you require to run your business.  

Real estate commission advance companies generally don’t take credit score into account in their underwriting process. In lieu of a credit check, most commission advance firms conduct a background check which tells them if someone has outstanding liens or historical judgments.  

Whereas a bank loan can take seven days or longer to approve and disburse payment, the application process for a commission advance is quick and easy to submit online, and can be approved and even funded same-day. Within 24 hours, your application can be processed, and funds deposited into your bank account. 

When should I take out an advance on a real estate commission?

Agents or brokers can take out a commission advance anytime they need early access to funds for personal or business reasons. 

Here’s a common real-world example: An agent who generally closes 12 transactions in a year, on average, hits a slow period where he hasn’t closed in two months and thus hasn’t earned commission during that time. The problem is, ongoing expenses and bills still need to be paid, and your bank account might be running low while you are waiting on a closing to go through. Using a real estate commission advance will allow you to get some of your money now to pay bills and expenses, and then you can collect the rest at closing.  

Sometimes, an agent or broker may have an unexpected one-time expense that exceeds any savings they have (i.e., home or vehicle repair). In these situations, an advance on their commission could help them receive accelerated access to funds they are owed at closing. 

Another Example: A real estate agent, knowing that spring and summertime are their peak revenue earning seasons, may want to start ramping up their marketing and advertising efforts a few months in advance, but they haven’t been paid on a few sales yet and don’t have sufficient capital to finance their marketing until they get paid. Instead of waiting on the money to begin marketing, they can work with a real estate commission advance company to receive immediate payment on a commission prior to closing, which would allow them to launch their campaign now and help grow their business.  

What does a Realtor commission advance application look like?

The application takes about 10 minutes to complete and can be filled out online. It asks for the amount of advance you are looking for, information related to the property on which you are requesting an advance, and the approximate closing date. Information related to the lender and lending officer is also usually requested. 

In the application, you will be asked to provide: 

  • Proper identification, such as your driver’s license. 
  • MLS listing of the property showing the status as “under contract”, “pending”, or “sold”. 
  • Wire instructions (where to send your advance). 
  • Closing date. 
  • Whether you are representing the buyer or seller. 
  • Evidence that contingencies have been satisfied. 
  • Commission sharing agreement or documentation showing net fees owed to you. 
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Applying with Accel Commission Advance

Once Accel receives your application, their proprietary cloud-based processing system allows them to advance your commission quickly and efficiently, in as little as 24 hours.

What do the underwriters look for on an application?

To confirm that the agent or broker requesting the advance is actively representing buyers or sellers in real estate transactions, underwriters look at data related to the number of transactions that the agent or broker has completed in the last six months and how many active and pending listings they currently have.

Accel Commission Advance requires that an agent or broker has at least one other listing or active deal in the process of closing. The deal must also be scheduled to will close within 45 days. Credit score is not considered in their underwriting process.

How are the fees determined?

Fees are set based on numerous factors, and each case is assessed individually. Accel offers reduced fees as an agent or broker completes more advances with them and establishes a consistent track record. Accel offers competitive fees as low as 8 percent. 

How does a commission advance work?

Advances will be delivered to your bank account via a wire transfer. Accel gets you paid fast. Overnight funding for Realtors is possible, especially for agents and brokers that have already done business with Accel. 

Repayment of the advance happens automatically when your sale closes. The settlement company will receive a commission disbursement authorization signed by your broker instructing them to send a portion of your commission directly to Accel on your closing date.

Every transaction is different, and the timing of each sales cycle can vary widely depending on how long it takes to get an inspection and lender in place, among many other factors. Accel Commission Advance provides flexible cash flow solutions to Realtors to help them meet their financial needs.

The Accel Commission Advance Difference

Accel’s friendly staff guides each client from filling out the application all the way through funding the advance. If you think their real estate commission advance solution could be the right fit for you, please call one of their advance specialists at 267-769-0747 . Or to apply online, simply click here to submit an application. 

Why Use a Real Estate Commission Advance?

A Real Estate Commission Advance from Accel Real Estate Commission Advance enables real estate agents in the United States to get their money right away instead of waiting for closing which can take anywhere from thirty days to six months. And while you wait, you do not have access to that money for marketing, doing other deals, paying employees, paying contractors, investing in new projects, and growing your business. 

Lost time is lost money. Lost time is missed opportunities. Big businesses never hesitate to use “other people’s money” to finance their growth. They take out loans, sell debt, sell shares of their ownership, factor their receivables, and take out futures contracts to hedge against inflation. 

But too often small businesses stay small because they think small. They launch their next marketing campaign after they get paid. They don’t take on a new deal until they get paid from the last one. They try to finance their growth with their own money, and as a result, they move much slower. They are timid about business finance. They don’t take risks, and they miss opportunities. 

With Real Estate Commission Advances, you can receive some of your cash now to finance operations and keep moving forward. 

What is a Real Estate Commission Advance?

Real Estate Commission advances allow real estate agents and brokers to sell a portion of their pending commissions for a fee, granting them access to their funds right away instead of waiting for closing.  

Is a Real Estate Commission Advance a Loan?

No – A Real Estate Commission Advance is NOT a loan. We purchase a portion of what is owed to you for a fee. This is a purchase of an asset that is owed to you. Once we purchase it (at a discount), we own the asset, and we wait until closing to get paid and you get some of your money now. 

What Are Some Advantages to a Real Estate Commission Advance?

For starters – Speed. Our turnaround is often the same day or next day. You get your money right away instead of waiting for closing which can sometimes take months. 

Credit. Since you aren’t taking out a loan, your personal credit isn’t a major factor, which makes the application process much easier – not to mention, these types of advances are almost always approved.

Fees. Also, the fees for a real estate commission advance will tend to be much lower than taking out a loan or using a line of credit to finance your operations as a real estate agent.

Advantages to Commission Advances

Why Would I Use A Real Estate Commission Advance?

Using a Real Estate Commission Advance allows real estate agents and brokers to manage cash flow, pay bills, pay employees, and finance growth while they are waiting to receive funds at closing. 

Businesses that think small tend to stay small. Large companies never hesitate to use “other people’s money” to finance their growth. They borrow money, sell debt in the form of bonds, sell shares, and take futures positions to hedge against price fluctuations. Why should small businesses operate differently? 

Every day you wait to do your next deal due to lack of funds will set you back because of the time-value of money. You never get that time back. Using a real estate commission advance is a great way to finance future growth and avoid missing opportunities. 

How Does a Real Estate Commission Advance Work?

You sell a portion of a pending commission to us for a fee. You receive your advance on your commission, and we are paid what we are owed at closing by the party in charge of the closing.

About Accel Real Estate Commission Advance

We are a direct funder, not a broker like most real estate commission advance companies. Because there’s no middleman involved, our fees are among the lowest in the industry, as we pass our savings on to you.

We factor numerous asset classes, helping attorneys, professional athletes, business owners, and of course real estate agents and brokers. Let Accel finance your next Real Estate Commission Advance.

Frequently Asked Questions about Real Estate Commission Advance

Question: Is there a minimum size commission that you advance Real Estate Agents? 

Answer: There is no minimum size commission, but the minimum fee is $250. 

Question: Is there a maximum size commission that you advance? 

Answer: Yes. The maximum amount is $30,000. 

QuestionAre there any reserve holdbacks? 

Answer: Yes, there is a 10% reserve holdback on every advance. 

Question: Are there any administration fees?

Answer: There is a $30 wire fee for any outgoing wires. Agents can opt to receive funds via eCheck for no charge. 

Question: Are there any application fees?

Answer: No.

Question: Do you advance brokers of record? 

Answer: Yes, on a case-by-case basis.

Question: Can I advance more than one deal at a time? 

Answer: Yes.

Question: How much of my Commission can I Advance?

Answer: Up to 80% of net commission due to agent. 

Question: How quickly can I get my advance processed? 

Answer: Advances are processed in 48 hours or less – majority of advances fund same day. 

Question: Are your advances restricted to a closing within 90 days? 

Answer: Within 120 days. 

Question: Do you require a minimum size deposit? 

Answer: No.

Ready To Apply for an Advance?