How are Exit transaction fees split between Exit offices when referral commissions are involved?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
These fees are payable to EXIT Realty Upper Midwest and EXIT and are uniformly imposed. These fees are subject to change by EXIT. Every sale or leasing transaction involves two (2) "Transaction Sides" a "Selling Side" and a "Buying Side." The Transaction Fee is payable on a commission or fee payable to you on a Transaction Side. All Transaction Fees that pertain to referral commissions between EXIT offices are split in direct proportion to the percentage of commission earned. For example, an EXIT Franchise office that receives 25% of a commission side, pays 25% of the Transaction Fee. A portion of each Transaction Fee is allocated to certain funds administered by EXIT (described in ITEM 11). Currently, the allocations per Side are as follows:
Source: Item 6 — OTHER FEES (FDD pages 13–15)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, when referral commissions occur between Exit offices, the transaction fees are split proportionally to the commission earned. This means that if an Exit franchise office receives 25% of a commission side, it is responsible for paying 25% of the transaction fee.
This proportional split ensures that each Exit office contributes to the transaction fee based on their share of the commission, aligning costs with revenue. The transaction fees themselves vary based on the gross commission amount, ranging from $50 for commissions between $250.01 and $2,500 to $400 for commissions over $25,000. These fees are payable to Exit Realty Upper Midwest and Exit.
For a prospective franchisee, this means that when engaging in referral agreements with other Exit offices, they should factor in the proportional transaction fee split when calculating their net commission. This policy promotes fairness and transparency in inter-office transactions within the Exit franchise system. It's important to note that these fees are subject to change by Exit, so franchisees should stay updated on any potential adjustments.