Why Tongo is Better Than Traditional Commission Advances and Credit Cards

By: Brandon Wright, CEO

Historically, financial infrastructure in the United States has been constructed and tailored with the needs of salaried and hourly workers in mind. Bills are due monthly because almost every lender, supplier, and subscription has assumed that their customers are paid every two weeks. Credit scores, too, are based on how well someone succeeds with monthly payments. However, today, the financial system needs to better serve the 72 million self-employed Americans, including commission-based real estate professionals.

Waiting for commissions to pay monthly bills isn’t always an option, which can put a financial strain on agents. Many agents, including many top producers, lean on credit cards to float expenses. The average American has six credit cards, and self-employed professionals typically have several more than the average. It’s an understandable method to fund their businesses since self-employed business loans are very challenging to obtain. Also, credit cards are flexible and offer minimum payments until accumulated commissions can pay off the balance. However, the downside is if balances are not paid-in-full every month, the balances can balloon from compound interest and credit scores decline with each late payment or when a balance gets too close to the limit. 

The cash-flow misalignment problem can also impact business growth. Sometimes, opportunities arise that require immediate capital investment to seize the moment and propel your business forward. These opportunities could be expanding your marketing efforts, staging to win a listing, attending a real estate conference, or investing in additional training or technology. Unfortunately, waiting for deals to close can mean passing on high-return opportunities that need to happen “right now.”  Of course, traditional commission advances are better aligned with these immediate cash flow needs, but historically they have been a tool of last-resort because they’ve been egregiously high-cost, hard to apply for, and inflexible in their terms.

Tongo was founded to solve these problems for self-employed professionals. An agent can create a Tongo account in less than a minute and add pending deals to confirm their available limit. That limit can be accessed as needed by instantly transferring funds to a linked bank account or by swiping the Tongo card. Here are the top three reasons that Tongo is a better option when compared to traditional commission advances and credit cards. 

1. Lower Cost – 50% to 90% Lower Fees 

Cost is a critical factor when choosing financial products, and Tongo excels in this area. Traditional commission advances and credit card rates can be notoriously expensive, often eating into a significant portion of your hard-earned commission. Tongo, on the other hand, is designed to be cost-effective. First, it’s free to have - if you don’t draw on your balance, then it’s a free safety net. When you do need it, the rates are 50% to 90% less than those of traditional commission advance services. With Tongo you avoid the hidden fees and pay as little as 3% per 30 days, and fees are tax-deductible. This substantial cost savings means more of your commission stays in the bank.

2. You’re in Control with Tongo

One of the standout features of Tongo is the unparalleled control it offers. With a traditional commission advance, agents receive a lump sum upfront, almost always more than they immediately need, leading to higher costs and potential financial mismanagement. In contrast, Tongo allows agents to draw exactly what they need, when they need it, and as often as they need it. This means you can manage your cash flow more effectively, drawing smaller amounts multiple times rather than a single large sum. This flexibility ensures that you’re always in control of your finances, helping you to budget better and reduce unnecessary expenses.

3. Instant Access to Funds

Time is of the essence in real estate, and waiting for funds can delay important decisions and opportunities. With a Tongo commission-backed line of credit you can access up to 75% of your pending commissions up to 60 days before closing. Once you’re approved through our streamlined application process, you can draw funds in less than 1 minute. We offer instant transfers at the same price as Venmo, allowing you to move money to a connected account quickly and effortlessly. This rapid access to funds ensures that you can seize opportunities as they arise, keeping your business agile and responsive.

Tongo is an innovative new financial tool for agents at every level of experience and production. With more control over your commission payments, significantly lower costs, a quick application process, and instant access to funds, Tongo offers a modern solution that addresses the limitations of both credit cards and traditional commission advances. Tongo is the future of financial flexibility. To keep your business moving forward, learn more at gettongo.com.