One of the most important factors to be able to grow your business is compensation. The pay, the benefits, and the perks that come with your job can make or break your experience with a company. In fact, research shows that a healthy compensation can help improve your happiness! So, when it comes time to talk about compensation with a potential employer, how do you know if they’re offering what they say? Here are some questions that will help shed light on any discrepancies:

What should I be asking a company about my pay and benefits?

The following questions will help you get a sense of your company’s priorities when it comes to compensation:

• Do you cap your compensation or commissions in anyway?
• Do you charge a back-end scoop off branch profits?
• Do you charge a success fee on closed loans?
• Do you offer any additional incentives above and beyond the margin on rates?

Here are some additional questions you want to ask:

• How soon after a loan is closed will I be paid?
• When can I expect to receive payment?
• How long does it take for the company to pay out?

Do you offer any benefits (i.e. health insurance, retirement plan, etc.)

The next thing to consider is what benefits do you offer? Ask about health insurance, retirement plan, life insurance, dental and vision insurance, disability insurance and long-term care (if applicable).

How does your pricing work? Are rates padded?

You will want to know exactly what your rates and fees are going to be. If you find that the company is not upfront with you, it can mean that they have padded their rates or added unnecessary junk fees.

You also should ask about the total costs, which are the costs associated with completing a mortgage transaction. These include file fees, underwriting charges, application fees and other miscellaneous expenses that will hit your branch P & L that will offset your revenue. You net profit is what matters everything else is smoke and mirrors.

How much do your top performers make?

• How much do your top performers make?
• Ask for specific numbers. How much did the top performer make on their last loan? What was their average over the last year?
• Ask for examples of how this person makes more money than others on a regular basis. 
• What are some strategies that you use in order to help producers make more money? This will give you an idea of what behaviors are rewarded, and which ones aren’t.

What is the commission split / payout structure?

You should ask your potential new employer how much compensation you will earn on each loan. The split between the company and the branch owner is typically decided upfront on the branch manager agreement prior to starting to work for a company, so it’s important to know before transitioning over.

You should also ask about any additional costs associated with closing loans, such as miscellaneous fees, bank fees, or company specific fees if applicable. These costs are typically absorbed by the branch or passed along to clients in the form of upfront fees so there may be some financial burden if your cover does not cover these expenses upfront. Or give you rates competitive enough to cover them yourself and still clear a healthy margin.

When it comes to payouts, things aren’t always what they seem.

So, here’s the deal: many companies offer a high compensation structure, it may sound like a great opportunity. But don’t be fooled by the hype. Many companies will offer big compensation only to recoup the funds off your P & L by calling it a success fee or a scoop based on your closed volume. This can be an extra 50 BPS to 125 BPS fee off all closed volume that goes to the company. Always find out about the bottom-line compensation and total fees upfront since this is a way branch companies will take advantage of you and your revenue.

In short, this is an example of how things are not always what they seem. The truth is that many companies use these types of tactics to make themselves look like they offer more money than they do. However, when you see through their smoke screen, what appears to be an amazing opportunity turns out to be just another scam with hidden costs that negate any real profit potential for independent branch operators like yourself!

Conclusion

Compensation can be a tricky subject. It’s important to ask questions about how you’ll be paid, but it’s also crucial to pay attention to what the company says in response. If they act evasive or vague on these issues, then there may be something else going on behind the scenes that could affect your bottom line.