Loan documents in CA

Market Conditions Effect on Escrow

Loan documents in CA

We have worked in the world of advanced commission for a long time, which means we have seen things change in a lot of different ways over the years. Every time a major shift happens in the financial market, it immediately follows that things change in the world of escrow accounts as well. We track these shifts pretty closely as it is directly connected to advanced commission. The following is a list of some of the changes we have seen with the current market conditions.

Longer Escrow Wait Times

The financial market is improving, which is a good thing, but many different big institutions are now making it a little harder for people to get the financing they need. This is a good thing, as a little caution now can help prevent another big meltdown like the one that happened back in 2008. That being said, the advanced investigations create a longer escrow time. The money sits longer before being distributed to the deserving parties.

Larger Escrow Accounts

There are fewer loans happening, but we have noticed that these loans are growing in size. The larger loans mean larger down payments and earnest money amounts. All of that is the money that typically sits in escrow accounts. This means that the escrow accounts we deal with are larger in nature due to the growth in the economic market.

More Restrictions on Accounts

This goes back to the tighter restrictions happening with loans. Banking institutions cannot afford to be lax about the security of the accounts under their stewardship. This has affected the world of escrow by making it so fewer people have access to these accounts, and fewer loans are able to utilize an escrow service. This is especially true in the case of new construction loans. We believe that as the market continues to improve, this particular change will not be as stark a difference as it is right now.

Business Plan for Real Estsate

The best real estate professionals understand what it takes to grow their business and stay one step ahead of their competition. 3 out of 5 top real estate agents utilize commission advances to support the growth of their business, as they realize the need for capital is real and it is an important component of a successful business. In addition, here are 5 other useful tips to help grow a successful business.

Develop a Business Plan for Real Estate

When starting any new business, it’s important to create a business plan. Your business plan should include information about your business structure, budget, and other things. Having it approved by a business attorney can also be helpful to ensure that you don’t forget anything and you are in compliance with all regulations.

Use Technology

Clients are using technology to find the businesses that they want to hire, so you need to use technology to find your clients. There are mobile applications, CRM systems for emailing, cloud storage, and many other technologies that you can use to boost your business.

Focus on Marketing

Marketing is important to gain more clients. You need to figure out the best method to reach your target market and make sure you allocate a sufficient budget to marketing each month.

Thank Your Clients

If you help your clients seal the deal on buying or selling their property or your clients refer someone to you, take the time to thank them. Write a handwritten thank-you note or drop off a meaningful gift to let them know that you appreciate their business.

Continue to Learn and focus on your Business Plan for Real Estate

After starting your business plan for real estate, don’t stop learning. You need to stay ahead of your competition by learning everything that you can about your field. Complete certifications, attend conferences, seek a mentor in your field, and find other educational opportunities.

When you’re just starting out, you can use these tips to help grow your business. And when you need realtor commission to help grow your business, stay one step ahead of the competition and use the advances to support the growth of your business.

Express Cash Flow, Commission Advances

3 Reasons Commission Advances Can Jump Start Your Business

Many real estate agents start their businesses on a shoestring. Even when an agent has been able to secure dozens of listings and potential buyers, there are a number of costs agents incur in the time between signing a listing agreement and closing a deal. Fortunately, today’s real estate agents can rely on commission advances from places like Express Cash Flow to ensure the bills are paid on time.

Here are 3 reasons commission advances can work for your business.

Traditional Loans May Be Hard to Attain

Traditional banks and lenders are often leery of loaning money to real estate agents and brokers. As you know, your income can be unpredictable, swinging wildly depending on the local housing market and even the season. Banks know this too, and many are reluctant to lend money to an agent who may have unpredictable income and is unwilling or unable to pledge traditional collateral. This can leave a hungry agent – even one with several deals in the works – in a difficult financial situation.

 

Running a Business Is Expensive

Though an agent may have an impressive number of deals pending, he or she may find themselves cash short when critical bills come due. Association and board dues can be a hefty expense, as well as access to the local MLS. To make matters worse, these fees generally come due at about the same time. Additionally, one of an agent’s most important expenditures – marketing – is ongoing. Those signs, flyers, open house goodies, and websites are a necessary part of doing business, and they aren’t free.

A Short Term Advance Can Hit the Spot

Traditional loans are great, but as a real estate agent, you don’t necessarily need a long term loan. While some banks will offer loans with repayment terms as little as 90 days, these loans are generally tied directly to an agent’s credit score. Since a credit score doesn’t factor in future income, this may not be the best way to assess a Realtor’s ability to pay back an advance.

Commission Advances  are a simple and speedy way to finance your business’s immediate costs. There’s no reason to put off paying your marketing or other business fees until your next deal closes. A commission advance will let you pay those bills today, and continue to grow your business.

Advance commissions in California are a simple and speedy way to finance your business’s immediate costs. There’s no reason to put off paying your marketing or other business fees until your next deal closes. A commission advance will let you pay those bills today.

3 Reasons a Deal Might Fall Through

One of the largest challenges of running your own real estate business is maintaining steady cash flow. You may have multiple contracts pending and ready to close within the next month, but that means nothing when you have expenses and overhead that need to be taken care of immediately.

Maintaining relationships with vendors, as well as with clients, is at the heart of your business.  Here at Express Cash Flow, we are dedicated to helping professional real estate agents and brokers improve their day to day cash flow and operating budgets. Similar to the way banks offer loans based on accounts receivable, commission advance companies like Express Cash Flow provide early payment on your pending commissions. You get up to 75% of your commission before closing so you can pay your service providers on time. Once you receive your commission on a real estate sale, Express Cash Flow receives the amount of the advance, plus their fee, back through closing.

Deals can fall through, however. Here are three reasons real estate deals sometimes breakdown:

Appraisals

Every lender and loan requires that the property in a pending real estate transaction be appraised. This protects the buyer – they don’t want to end up upside down in a new real estate investment – and ultimately, protects the lender, too. Real estate appraisals are typically based on recent sales.  If sales haven’t caught up to a shifting market on the rise, this can happen. Sometimes, these deals can be saved through negotiations, but if the difference between the appraised value and the sale value is too great, these deals can fall through.

Property Condition

With the help of savvy buyers’ agents, most prospective home purchasers will request an inspection. An inspector will test and examine all of a home’s systems, including electrical, plumbing, HVAC, and even the roof. These deals may fall through if the seller doesn’t have the finances to cover the work and can’t afford to take a hit on the sales price. In foreclosed homes, banks are often unwilling to finance any repairs, meanwhile, the lending bank is unwilling to make a loan in the home’s current condition.

Buyer Motivation

Looking at homes to buy is fun. Dealing with all the requisite paperwork and effort to close a deal isn’t. If a buyer isn’t very motivated, even the smallest hiccup – and there will be hiccups – may lead them to believe it’s easier to walk away from a real estate transaction.

Any of these factors, as well as many others, can delay the all-important close of escrow.  Utilizing a commission advance can allow agents to breathe a little easier during their escrow, knowing that the money is already in their pocket.

Express Cash Flow also understands that not every escrow closes.  As a real estate professional, we trust that you are going to close another escrow in the near future, and may even have other escrows going concurrently with the escrow associated with the advance.  That’s an easy enough solution we simply transfer your advance to another escrow, and there is no out of pocket payment for you.