DA - How to Book a Personal Transaction and Royalty – KWMCAngel

Booking a Personal Transaction (Royalty Only)

For more information, please visit the most recent Policy & Guidelines Manual section 4.9.1.24

If commissions are paid on the transaction and shown on the HUD, the sale or listing commission should be entered into WinMORE and match what is on the HUD just like a normal closing transaction. Examples of how commission appears on the HUD are provided below.

In these cases, the amount listed on the HUD must be entered on Page 2 as commission and in the Associate on this DA in the Gross field - just as you enter on a traditional DA. This is reportable income on which the associate must be taxed. Click here to jump to the sample DA and instructions below.

If commissions are not paid on the transaction and shown on the HUD,

and the money to cover Company Dollar and/or Royalty is paid directly by the agent to the market center, the sales or listing commission amounts will be $0 as in the examples below. Click here to jump to the sample DA and instructions below.

Calculating Royalty Owed

As royalty is owed on personal transactions per the KWRI Policies & Guidelines, use the following instructions to calculate how much royalty to enter into WinMORE when booking the DA:

To calculate royalty owed, you may need to do some research. You will need the following amounts:

Sales Price - from the ratified contract or addendum after contract changing the sales price
Commission rate for your agent only - from the listing agreement if you have the listing or the MLS listing if you have the buyer

The formula is (sales price) x (commission rate) x 6% = royalty that you will collect and enter into WinMORE on the DA.

When associates are paid at the table, provide the total amount of royalty and fees owed to the market center to title and receive the amount from title/attorney.

When all commission is paid to the market center for distribution, provide the total amount to the associate and receive a personal check (or other method) from the associate in the amount required.

Prepare the DA (example for $250 commission on HUD)

A closing DA is required to be posted for all transactions, even when the associate is fully capped and no funds are exchanging hands. The DP deposit must also be imported and recorded in AccountEdge/Lonewolf.

Complete page 1 of the DA as usual.
Click Save/Part 2
Since $250.00 commission is paid on the transaction (HUD), the listing commission (Sellers Broker) amount will be $250.00.
On the associate detail screen, add the associate to the DA.
1. Gross commission should $250.00.
2. Associate splits will be 100%.
3. Associate commission should be 0.
4. Tab through the rest of the DA, ensuring you enter the royalty amount in the royalty field.
5. The Pay to KW amount will equal the total amount entered into Gross commission.
Post the transaction and process the deposit as usual.

IMPORTANT: This will create a royalty exception, which will likely require a royalty adjustment from KWRI. Please refer to How to Request a Franchise Royalty Adjustment to resolve your royalty exception as soon as possible after completing this transaction.

Prepare the DA (example for $0 commission on HUD)

Complete page 1 of the DA as usual.
Click Save/Part 2
Since no commission is paid on the transaction (HUD), the sales or listing commission amount will be 0.
On the associate detail screen, add the associate to the DA.
1. Gross commission should 0.
2. Associate splits will be 100%.
3. Associate commission should be 0.
4. Tab through the rest of the DA, ensuring you enter the royalty amount in the royalty field.
5. The Pay to KW amount will equal the amount you collected for royalty.
Post the transaction and process the deposit as usual.
IMPORTANT: This will create a royalty exception, which will likely require a royalty adjustment from KWRI. Please refer to How to Request a Franchise Royalty Adjustment to resolve your royalty exception as soon as possible after completing this transaction.