Hello,

I have a question I hope you can help me with. A friend has a deal that is set to close around Jan. 4. It's a large cash deal, and if it closes before the end of the year my friend will save lots $$$$ of money on the split with the broker.

Is there any way my friend could get paid before the deal closes? If they close in escrow could my friend be paid out of escrow? Would it be wrong for my friend to ask my client to pay me before the end of the year?

Any advice is extremely appreciated.

I'm so glad my split doesn't reset every January. Sucks to work hard all year long only to end back up at the bottom again with the new year!

Sorry, I don't have anything to contribute except to say - I would doubt that it could be done...at least in PA, the licensee can ONLY be paid by the broker. And it's obviously in the broker's best interest to make her wait till January.

:-(

Chances are the broker would not have the funds to pay your friend anyway since they get paid from the closing as well.

What if for some reason it doesn't close and your friends gets paid in advance, spends the money, and the deal doesn't close then?

You can ask but typically commissions are earned upon a successful closing.

Depending on how her broker would handle a commission advance, she could try that. There are tons of companies out there who do that, but their fees (around 10%) may negate what she is trying to accomplish.

Generally, commissions are paid at settlement, but there is nothing in the law that would preclude you from being paid in advance.

It strikes me as odd that someone wants those on the board to figure a way around their contract with their broker. . .

Actually, I agree! You have to pay the piper sometime!

I think your "friend" needs to just accept the closing date as proposed and let the chips fall where they may...a deal is a deal.

maybe your friend should look at going to a brokerage that doesn't reset the commission structure every year?

I think your friend made their bed when they went to work for their broker and now it is time to lay in it. If they are unhappy with their split they should renegotiate it or move on.

Tell them to do the friggin' deal and quit acting like the reason that so many people hate realtors...greed. Youre gonna do the deal or not. Sooner or later in your career youre gonna have this sort of thing happen if youre working with a resetting split. We have an agent who did a 2 million deal and hadn't "capped" so he had to split about 27 percent to the broker. A few months later and he would have kept it all. The cookie crumbles. She can always go to a 100% broker if she can afford to.

The broker might actually give a commission advance but it would probably be based on what the split would be at the closing! Therefore...if the broker is smart, he or she would only give what the agent is entitled to as per their contract.

If I were your friend I would ask to renegotiate that January reset. My office doesn't do that - you split is based on your performance and doesn't reset unless you stop producing.

The commission advance I was talking about was not through the broker, but through companies like Agents Advance. They are like paycheck lenders. You can get advances with a ratified contract or a listing agreement for a fee. It still passes through the broker for payment to the agent (if that is what is required by law).

Not that I am recommending that. Just providing information....

I'm still really confused about the "Would it be wrong for my friend to ask my client to pay me before the end of the year?" comment. I can't tell who's who.

-jeff

somehow, I think that perhaps the OP is actually the agent in question - started out as an imaginary third person, that got confused.