Is the eXp Referral Division Right for You?
eXp Realty is a residential property brokerage that is well-known for its favorable commission-based structure and Agent Equity Programs, where agents can become stakeholders.
eXp Commercial, on the other hand, is the commercial sector of the popular brokerage that houses our topic for today, the eXp Referral Division.
The eXp Referral Division offers a unique opportunity for agents who are focused more on revenue generation from referrals and less on traditional real estate transactions. This referral-based practice allows them to generate income and reduce costs by cutting down on board and MLS fees while maintaining an active license.
That is why the Referral Division is housed under the commercial umbrella, as commercial agents are exempt from mandatory membership in local real estate boards and MLSs.
By being part of the eXp Referral Division, agents can still create an income without the day-to-day responsibilities of property transactions by focusing on generating referrals through their network.
Keen on joining the eXp Referral Division? We break down the basic structure of the division, fees, pros and cons, and how to gauge if this is the right fit for you.
What Is The eXp Referral Division?
The eXp Referral Division is a section under eXp Commercial that allows agents to generate revenue through referrals to actively selling agents. The division’s allure is that it helps agents avoid the expense of board and MLS fees.
The role of the Referral Division within eXp Realty is to offer agents an option to continue earning income through referrals without actively selling property. It provides a way out for agents who seek to exit active practice without putting their license on hold or in escrow.
By participating in the eXp Referral Division, agents can keep their licenses active by meeting state requirements and pursuing their continuing education.
The Exp Refferal Divison differs from traditional referral networks in several ways, including:
- Lower fees and zero escrow requirements.
- Revenue share participation and stock options just like any other eXp agent
- Agents can maintain multiple licenses across states for minimal charges, whereas traditional systems require separate arrangements for different licenses.
eXp Referral Division Fees
eXp Referral Divison has very competitive charges compared to the overall market. Here is an overview of the division’s fees:
Commission split
The commission split depends on the type of referral, whether internal or external.
For internal referrals, that is, where an eXp agent refers a client to another eXp agent, the commission split is 75/25. The referring agent gets 75% of the referring fee, and the rest goes to the eXp Referral Division.
For external referrals, where an eXp agent refers business to an agent outside the eXp network, the commission split is 70/30. 70% goes to the referring agent, while 30% goes to eXp.
This referral system allows agents to earn revenue, whether working with other eXp agents or external agents, expanding their reach with immense growth opportunities.
Revenue Share
- Agents who choose to join the eXp Referral Division still participate in the company’s revenue share. They can still attract new agents and earn a share of their commission income.
- Referring agents can participate in the FLQA (Front Line Qualifying Agent) Status. To qualify for FLQA, an eXp Referring Division agent must earn at least $5,000 in Gross Commission Income every six months.
- The existing eXp revenue share structure applies to agents in the Referring Division as well.
This includes retaining your existing revenue share position if you’re transitioning internally and maintaining revenue share percentages if you are a sponsor.
Other Potential Fees
- Monthly Fees: Agents in the eXp Referral Divison pay a monthly fee of $50, down from $85 as an active agent. The reduction reflects the exclusion of MLS and board expenses.
- No cap on referral fees.
- Agents must continue their education and pay state dues to keep their licenses active.
- Agents may attract potential fees in lead generation tools as they no longer get access to eXp Realty tools such as KV Core.
eXp Referral Division vs eXp Realty: Key Differences and Considerations
eXp Realty is the most well-known division of the brokerage firm. It deals with residential operations as a full-fledged brokerage. It offers agents a comprehensive system with tools and resources for success.
On the other hand, the eXp Referral Divison is part of the eXp Commercial. The Referral Division caters to agents who want to maintain their license but are focused on revenue generation rather than active real estate transactions.
Here are some comparisons between the two;
eXp Realty | eXp Referral Divison | |
Monthly Fee | $50 | $85 |
Revenue Share | Sponsors receive up to 3.5% of the Gross Commission Income (GCI) of agents they bring into the company. | Sponsors receive up to 3.5% of the GCI from referrals |
Stock Awards | Agents earn stock awards based on performance. | Stocks previously earned with eXp remain, but no new stocks are awarded. |
Team and Mentor Programs | Active agents can join teams and other mentor programs. | Team and mentor programs are not available in the eXp Referral Division. |
Board and MLS Dues | Agents pay board and MLS dues. | No board or MLS costs. |
When To Choose One Over The Other
If your focus is solely on revenue generation without actively selling or leasing property, the eXp Referral Division can help you keep your license active and generate referral income.
On the other hand, if you want to stay active in the field and continuously close real estate deals, eXp Realty may be better suited for you.
What Are The Benefits Of Joining The eXp Referral Division?
There are many benefits to joining the eXp Referral Divison, including:
Advantages For Real Estate Agents
- Cost savings on MLS and board fees as monthly costs go from $85 to $50.
- Agents get to maintain an active license without actively conducting real estate transactions.
- Part of the requirements includes continuing their education so agents can sharpen their skills and stay competitive without losing income.
Potential Income Generation
- The eXp Referral Division offers great flexibility. Agents can get licensed in multiple states and generate more revenue, as referral fees are not capped.
- Agents who were part of eXp Realty get to keep their stock awards, preserving previous equity gains.
Access To Resources And Support
- Agents still have access to eXp’s vast network of industry professionals and specific resources, which provides opportunities for collaboration and growth.
How to Move From eXp Realty To eXp Referral Division
Moving from Realty to Referral can be rewarding, depending on your goals and aspirations.
It is vital to assess your current career status before making the leap. For instance, making a financial assessment by examining your current income and costs with projected referral income and reduced monthly expenses is essential.
Additionally, it is essential to assess your network’s potential for generating referrals. A solid network is crucial to success in the eXp Referral Division.
Ideally, you should transfer any vital information from your eXp Realty account, such as contacts, transaction history, and important documents.
Once your assessment is complete, reach out to your eXp state broker team for guidance on making the move.
You will have to sign a new Independent Contractor Agreement (ICA) specific to the eXp Referral Division.
How To Fill Out Exp Referral Form
Here’s eXp’s guide on filling out referral forms:
- Find an Agent
First, identify the agent to whom you want to send the referral. This could be an internal eXp agent or an external agent outside the eXp system.
- Sign the Agreement
For internal referrals, agents complete the referral agreement by signing in to their eXp account. Once the form is completed, the e-sing process begins, and a Dropbox Sign (HelloSign) is sent to the agent’s email.
Once the referring agent signs it, it is sent to other parties, including the receiving agent and the respective broker.
- Get Paid, and Repeat!
Once all parties sign the referral form and the transaction, the referring agent is paid their dues.
What Are The Limitations Of The Exp Referral Division?
The eXp Referral Division is a great opportunity for agents seeking an alternative to full–time practice. However, it still has some limitations, including:
- Limited Income Potential: Relying solely on referral fees can limit income potential compared to actively selling properties.
- No Direct Client Interaction: Agents in the referral division miss out on the satisfaction of working directly with clients and building long-term relationships.
- Dependence on Other Agents: Success in the referral division heavily relies on the performance of the agents to whom you refer clients.
- Reduced Market Presence: With active involvement in property transactions, you may gain visibility in the local market.
No Access to Certain Tools: Referral agents don’t have access to lead generation tools and resources available to active agents.
