Hello. I am a fairly new agent with a few deals in the works (both listings and sales). I am currently working with a large franchise and could really use some advice. We have several compensation options available. The 1st is a free 50/50 split. The next is a buy up plan (roughly $500-$600 per month for the top tier of 75%). The last is a "desk fee" plan paying 100% (costs approximately $1400/month). All of the plans require the agents to pay for everything other than the most basic of services. We pay E&O, MLS, marketing, signage, postage, etc. The only thing we are not required to pay for is the most basic of training. Much of it has proven to be less than stellar. The one "premium" education multi-session course that is offered requires a lengthy time commitment (more than a year) or you must pay the company several thousand dollars. We do not have assigned workspaces (even when opting for the "desk fee" plan) and a small, exclusive group of agents receive the lion's share of the perks (referrals, office space, etc.) The first 2 compensation options require no time commitment. The "desk fee" plan requires a 1-year minimum commitment. The commitment is guaranteed with a credit card and is billed monthly for 12 months even if you leave the office to join another broker. I have a large deal going to contract in the next few days and I need to make a decision as to whether I should commit to one of the programs or bail before I put the deal together. I would sincerely appreciate hearing your opinions. Thanks very much!

On the 50/50 split, does your split ever increase with production? If not, I would leave and go with a different broker immediately!

The other plans seem very expensive as a new agent per month. The split is better, but you will be paying a lot of money. It doesn't seem like this is a company for a new agent. You don't need to be a veteran to answer your question on this one either. We all understand splits and how they work.

Thanks for your reply, Len. I appreciate the advice. Take care and have a great week!

If you have a Keller Williams in your area go interview with them. You have a Max dollar amount that the office gets and then you go to 100%. If you don't get to that dollar amount the rest is forgiven and you start over next year owing nothing.

I would take the second option until my deals close, and then high-tail it to another franchise.
--A

Thanks for the responses. I appreciate the advice I attended a class today and even managed to pick up a few more companies to check out.

Hope you're doing well. Your split scenario is pretty awful. I've never heard of an office charging desk fees after an agent left. Let us know what happens.

Where is the benefit to the agent? I can't see any of those options benefitting anyone but the broker/owner. Funny thing is that I know what company you are describing, but out of respect, won't name them (unless you choose to).

There are benefits to working for a large franchise, like the backing of a "trusted" company in Real Estate and national marketing campaigns. How many (if any) of the leads generated as a result of billboards, television advertisements, etc., are you given to you and how often are they distributed? I think that is about the only way that I would take any of those splits, because I know that I would make up for the lost money by doing a lot of volume that I didn't personally have to work to generate. If not, you are better off working for your own financial interest and be compensated accordingly. Under NO circumstance should you give away money for nothing in return. Your broker is in business as much to sell houses as they are to sell agents on their splits...

I am curious to know what company you end up choosing and why...