Partial Payment Transaction

A Partial Payment Transaction is configured when commission is collected and paid in installments such as a new construction/builder home or if the expected commission is not received in full.

New Construction/Builder Transaction

Typically, a new construction/builder transaction involves multiple payments of commission.

  1. A commission amount of $5000.00 when the agreement is firm.
  2. 50% of the remaining commission could be paid when construction begins.
  3. 50% of the remaining commission could be paid when the transaction is closed and registered.

Late or Non-Payments of Commission

Many local real estate governing bodies stipulate that commission be paid to all parties within ten (10) business days of the transactions closing date.

If commission is not received by the Controlling Brokerage within the timeline, the Brokerage must disburse any escrow/trust deposits proportionately between the selling and buying sides of the transaction. When the balance of commission is received, the Brokerage would disburse the remaining commission proportionately.

Partial Payment Transaction Guidelines and Restrictions:
  1. Each commission amount received will be treated as an individual transaction, linked to a main transaction to ensure commission data integrity.
  2. Each payment will be disbursed to all parties involved proportionately based on the percent of end, commission rules and commission plans associated with each payment, including Managers.
  3. Commission plan(s) can be assigned to the Sales Associate on the fly or amounts can be overwritten.
  4. Edits to Withholdings, Manager Overrides, Other Fees & MLS/Transaction Fees are supported.
  5. Select reports will include all related transaction(s) and their detail collectively as a sum total and individually.
  6. All partial payment transactions must be closed, processed and integrated before processing the main transactions closing.
  7. Force Validation – If the main transaction has been configured with Force Validation, this means that the sum all the partial payment transactions closed, processed and integrated MUST EQUAL the main transaction. Alternatively, if the main transaction is not configured with Force Validation then it is your responsibility to ensure that all partial payment transactions equal the total commission receivable and payable on the main transaction.
  8. If the main transaction is voided, then all the partial payment transaction statuses will change to void. However, if there are any partial payment transactions that have already been closed, processed and integrated, the main transaction cannot be voided until the processed partial payment transaction has been reversed.
  9. If the main transaction is closed, it must be reversed before any of its partial payment transactions can be reversed. Individual payments can then be voided and/or reversed on their own without affecting other related partial payment transaction(s).
  10. A partial payment transaction does not support “Agent Advances”. If you try to add an “Agent Advance” is to the main transaction or partial payment transaction(s), you will receive warning that the agent advance cannot be assigned. Agent advances must be detached and/or reset to $0 and/or re-assigned, otherwise the transaction cannot be closed.
  11. A partial payment transaction cannot be a main transaction to other partial payment transaction.
  12. A partial payment transaction will inherit most values from the main transaction, including configuration on the Escrow panel of the Deposit tab; the escrow/trust deposits and interest calculations are excluded.
  13. Please note that if any changes have been made to open partial payment transactions, other related partial payment transactions will not be automatically be recalculated, changes will be manual and configured by user.

How to Enter a Buying End Partial Payment Transaction

1. Transaction is entered the same as any other buying end transaction. Please see Entering a Transaction for full details. This transaction will now be referred to as the Main.

2. Edit the transaction and place check in field “Enable Partial”, the Force Validation check will automatically check by default and SAVE the transaction.

3. Select the Add button and a new transaction will create with all the same information as the main. The transaction number will append an “A” to the end of the transaction number to designate the first installment. Select SAVE icon and when prompted select the “Side Represented”.

4. The new transaction will be at the bottom of your list of open transactions, select EDIT icon and navigate to the Commission tab enter the first installment of gross commission expected. Commission for the Selling and/or Buying side will automatically calculate, including the Agent Commission Details window.

5.  You can override and/or change the Agent Commission Details amounts for this partial payment transaction if needed. However, if Force Validation has been selected, all payments will still need to balance to the amounts configured on the main transaction.  Once you have made your changes, select SAVE icon.

6. You may now process this transactions’ closing.

7. Continue steps 3-6 for each installment until the full commission attached to the main transaction has been received and paid. For each partial payment transaction (installment) created, the gross commission with automatically populate with the remaining commission receivable. You can only create a partial payment transaction by select the Add button on the main transaction.

8. Once all the commission has been paid out in full, you will close the main transaction.  Reminder: you cannot take any Agent Expense Payments when processing the main transactions closing. 

*** All applicable Reports, Sales Associate commission calculations and the D1 format of the Transaction Record Sheet will update with each partial payment transaction closed, processed and integrated to QuickBooks®.

*** All QuickBooks® checks, deposits and journal entries will display with the letter appended transaction number and address.

*** If this is the last payment of a Partial Payment transaction, you will be prompted with a reminder to close the “Main” transaction.

 

How to Enter a Selling End Partial Payment Transaction with an Escrow/Trust Deposit

1. Transaction is entered the same as any other selling end transaction, including escrow/trust deposits and/or interest. Please see Entering a Transaction for full details. This transaction will now be referred to as the Main.

2. Edit the transaction and place check in field “Enable Partial”, the Force Validation check will automatically check by default and SAVE the transaction.

3. Select the Add button and a new transaction will create with all the same information as the main. The transaction number will append an “A” to the end of the transaction number to designate the first installment. Select SAVE icon and when prompted select the “Side Represented”.

4. The new transaction will be at the bottom of your list of open transactions, select EDIT icon and navigate to the Commission tab enter the first installment of gross commission expected. Commission for the Selling and/or Buying side will automatically calculate, including the Agent Commission Details window.

5. If the first partial payment transaction is disbursing the escrow/trust deposit in its entirety, you will need to enter the commission amount as it would be broken down into commission receivable and tax.  For example, a $20000.00 deposit can be divided by 1.13 (tax rate = 13%) to get the correct amount of commission, ($17699.12) and tax ($2300.88).

6. Escrow/Trust Deposits – although the trust deposit is attached to the main transaction, it can ONLY be disbursed via a partial payment transaction.  To do this via the Deposits tab of transaction, select the Escrow/Trust icon then select New icon. Action = Disburse and enter the corresponding amount to disburse (full or not). This also applies to any balance that may be due to the Seller for deposits that exceed the total commission payable.  If however, you forget to issue the balance due to the Seller or the interest amount to the Buyer you will always be prompted within the application.

7. In a Two Bank accounting system, the balance of commission receivable from the Seller MUST be deposited to the Main transaction before it can be disbursed from any of the other partial payment transactions.

Do not need to be concerned about the escrow/trust ledger balancing at this time; everything will update accordingly, once the partial payment transaction has been closed, processed and integrated to QuickBooks®.

8. You can override and/or change the Agent Commission Details amounts for this partial payment transaction if needed. However, if Force Validation has been selected, all payments will still need to balance to the amounts configured on the main transaction.  Once you have made your changes, select SAVE icon.

9. You may now process this transactions’ closing.

10. Continue steps 3-8 for each installment until the full commission attached to the main transaction has been received and paid. For each partial payment transaction (installment) created, the gross commission with automatically populate with the remaining commission receivable. You can only create a partial payment transaction by select the Add button on the main transaction.

11. Once all the commission has been paid out in full, you MUST enter any interest earned before processing the main transactions closing. Navigate to the Interest panel within the Escrow/Deposit window on the main transaction, select Edit icon and complete the interest details as required.

12. You may now SAVE and process the main transactions closing. Reminder: you cannot take any Agent Expense Payments when closing the main transaction.

*** All applicable Reports, Sales Associate commission calculations and the D1 format of the Transaction Record Sheet will update with each partial payment transaction closed, processed and integrated to QuickBooks®.

*** All QuickBooks® checks, deposits and journal entries will display with the letter appended transaction number and address.

*** If this is the last payment of a Partial Payment transaction, you will be prompted with a reminder to close the “Main” transaction. This will ensure that any interest payable to the Buyer and/or applicable resource will be disbursed as expected.

 

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