Decoding Compensation: How Real Estate Transaction Coordinators Get Paid

In the intricate world of real estate transactions, the role of a Transaction Coordinator (TC) is indispensable, ensuring a smooth journey from listing to closing. One crucial aspect that often raises questions is how these diligent professionals are compensated for their valuable services. Let's delve into the three primary compensation models that govern how Real Estate Transaction Coordinators get paid.

Paid at Closing through Commission Disbursement Authorization (CDA)

Most Brokerages will allow Real Estate Agents to add a variety of deductions on their Commission Disbursement Authorizations (CDA). There are loads of benefits to this as most brokerages that allow this track your deductions making your taxes at the end of year really easy to calculate what you have paid. It also allows easy of access where you are not paying out of pocket and your Transaction Coordinator gets cut a check at closing :)

This is most Transaction Coordinators preferred method!

Paid Outside of Closing

If you have Brokerage that does not allow outside deductions or doing a personal deal where you are not taking / receiving any commission, getting paid outside of Closing is the real only other option.

Typically your hired Transaction Coordinator will have some sort of method setup for this: ie. AppleCash, Venmo, Personal Check or Quickbooks. This is something to cover with your hired TC when you first start working with them!

[Secret Hack] Charged to the Client through an Admin Fee

A secret hack that most agents do is charge an Admin Fee to their clients for the cost of the TC’s Fee. That way they are not actually paying that out of pocket and still retain thier commission (outside Brokerage Fees or other deductions / referrals).

This might cause a few conversations as Clients perceive them as an added expense, however there are lots of scripts that are great for explaining and rationalizing the additional fee.

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Choosing the right compensation model for Real Estate Transaction Coordinators involves a delicate balance between aligning incentives, managing cash flow, and meeting client expectations. Whether paid at closing, outside of closing, or through admin fees, each model comes with its unique advantages and considerations. Real estate professionals and TCs must carefully evaluate their preferences, business dynamics, and client needs to determine the most suitable compensation strategy.

As the real estate landscape continues to evolve, finding a compensation model that fosters collaboration, transparency, and financial sustainability is key. At Avenue Transactions, we by default include our TC on the CDA, or just bill the agent directly through Quickbooks! We value making sure our services and payments are easy and carefree :)