How is Tongo different from a Commission Advance?
Often we find that real estate agents and brokers think of Tongo within the framework of a commission advance. While there are some similarities, Tongo is a unique product that was built to stand in a category of its own. With that in mind, we wanted to take a moment to explain just how Tongo is different from a commission advance.
Flexibility
With a commission advance, agents need to request a specific amount that they would like to advance when they submit the application. When approved, the advance company will send that amount to the agent. Since it's designed to be a one-time transaction, we found that agents often need to submit additional advance requests on the same deal. In other cases, agents try to forecast the amount they will need to last until the deal closes. This can result in agents advancing more than they actually need.
Tongo operates more like a line of credit rather than a one-time advance. Submit your pending deals and an available limit based on your commissions will be approved. The limit can be accessed immediately by either transferring funds to a linked bank account or by swiping the Tongo card. Access as much as you want or none at all. You only pay fees on what you use. If you choose to not access your available limit, there's nothing to pay.
Privacy
Commission advances require that a third party signs off and repays the advance company directly when the deal closes. This can create delays from waiting for brokers or title agents to sign the agreement. In addition, we feel as though you have a right to your privacy when it comes to which financial products you decide to use. Tongo doesn't require brokers, title agents or any other third parties to sign off in order to access pending commissions. The agreement is between you and Tongo. When the deal closes and you have received your commission, you just repay Tongo directly.
Price
Commission advances generally come with a fee of 7%-15% of the advanced amount. Some commission advances come with hidden fees as well as late fees for closings that occur outside the grace period. Tongo costs as low as 3% per 30 days with no hidden, additional or late fees.
Speed
As mentioned, commission advances require a third party to sign off which can delay approval. If you want same day access to funds you will often need to pay an additional fee for a wire. With Tongo, there's no waiting for a third party to sign off so that translates to a much faster approval process. Once you're approved, you can immediately access your approved limit by swiping your Tongo card or initiating a transfer to your bank account.
Our mission is to help realtors set and meet their financial goals. We believe that commission-based professionals deserve flexible financial products that work for them and with that in mind, we built Tongo. Click here to create a profile.