Posted by Belinda/CA on 3/19/13 10:17am
Msg #461950
Several asked me to re-post this. Truth about fees.
(Break down of expenses vs fees. Written originally for a new notary who posted days ago but it is something we all need to think about. Especially those entertaining low fee offers.)
This business is very difficult to get going in and to stay in.
You were probably told it is easy and you’ll make a lot quick. Since when is that philosophy so?
You need to be a marketing guru, spend hours a day for months and months to get jobs going in your direction, pound the pavement and spend hours and hours and hours applying with places, learning your craft, learning terms and documents frontwards and backwards, and learning your state laws.
It takes huge amounts of time and effort and then it pays off. Maybe not for a year or more depending on your tenacity.
Do not work for peanuts. Maybe figure what you have to make per year to do well. Work backwards from there. How many signing will it take to make that much and how much per signing to make that much. How many can you do in a day? What are your expenses? How many miles per gallon does your car get and how far are you willing to travel for a signing? Gas is going up and up slowly but surely. Figure what you have to make per signing to make a profit. A profit!
Remember you have to pay taxes. For an example of taxes: one of the posters here on the board posted about his taxes after he had them done for 2012. He said after expenses and paying taxes he was left with 52% of his income to live on. WoW! This is probably typical.
With the 52% in mind, if you are making $150 per signing that boils down to $72 for taxes and expenses and $78 dollars for you. Keep that in mind as you figure how much you need to bring in for a year. Consequently, the amount you figure you need per year needs to actually be about double that. Good ole’ self-employment. Also, I’ll bet that was for normal wear and tear on the vehicle. What if you have to buy tires, a transmission, a started, etc. Your computer goes caput. Then your profit is even less.
Soooo, charge appropriately. Once you start selling yourself short you have set a precedence with the companies and you can't raise your fee afterwards just because you have more ‘experience.’ They will not go for that.
For example keeping the 52% in mind:
Do an $80 signing and take home $41.60
Do a $125 signing and take home $65.
Do a $150 signing and take home $78.
(Hum... to bring home that $80 fee you are so excited about and are readily accepting you really need to be making $150...)
Surely your hard work and expertise is worth more than $41.60.
Also, these loans signings are not just stamp and run as you will see. So, then you have to divide that $41.60 by, say, four hours because being new to the field takes time. Now you are making $10.40 per hour.
It is not out of line to consider you will spend 1 hour or more once you get the workorder to read it, to go over the docs, and think them through and tab them or whatever you are going to do to get them ready as a new signing agent. You will be nervous. Then maybe 1.5 - 2 hours with the borrower(s). Half and hour to drive there and half and hour to get back to the office. Another hour to go over the docs paranoid you overlooked something and then go back out to FedEx. Hopefully you do not have to go back to get an initial before dropping the docs at FedEx. Oh yeah, that takes time too. You are now at 4.5 - 5 hours. Now you are making $9.24-$8.32 per hour of the $80 lowball fee. $80 sounds great to some. But, is it really?
See why this board so strongly encourages people to not work for pennies on the dollar?
Even when you get quicker $41.60 (an $80 signing fee) is a pittance. Let’s say your signings start getting to be 1 hour at the table, 1 hour there and back, 30 minutes prep, re-check, and dropping at FedEx. This is assuming there are no hitches and believe me there can be plenty of hitches. That is 2.5 hours per loan. Divide $41.60 by 2.5 and you will get a whopping $16.64 per hour. All the while wearing your car out along with the burden of liabilities.
Think hard about what you accept as a fee.
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Reply by 101livescan on 3/19/13 11:21am
Msg #461959
That's how I break it down, too, and it gives less and less credence for working for the "monkey in the middle", don't you think? The guy who wants to pay you 60 days later or not at all?
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