In an effort to improve the product experience, Buildout is migrating all Back Office and Manage & Close customers to payable-based commission plans. To better understand these changes, we’ll start with a recap of how commission plans previously worked.

In Buildout, commission plans are used to calculate a broker’s split with the house. As brokers earn more commission, they move up the commission plan “tiers” and get more favorable splits. For general information on how to use commission plans in Buildout, see this Help Center article.

On a new commission plan (or after a commission plan resets—usually on January 1st), each broker starts with $0 in plan progress. When exactly does this number go up? Historically, a broker’s plan progress would increase when you logged a new payment to the broker in Buildout. Likewise, the broker’s split would be calculated based on their plan progress when the payment was created.

Moving forward, a broker’s plan progress will increase as soon as a new payable for that broker is generated. Or equivalently: A broker’s plan progress will increase as soon as their commission is collected by the brokerage (since broker payables are generated whenever a new deposit is applied in Buildout). From Buildout’s perspective, that money has been “earned” by the broker, even if you haven’t paid them yet.

Similarly, the broker’s split is calculated based on their plan progress when the payable is generated. In other words, their split on the payable is “locked in” from the moment the money is collected—when you actually pay the broker is irrelevant.

First and foremost, we’re making this change based on customer feedback. Over time, we’ve discovered that this is how most brokerages want commission plans to function. Once a commission is collected, the broker has “earned” that money and should get credit towards their plan. The timing of the payment to the broker shouldn’t matter: some brokers defer payment for tax reasons, some brokerages only do biweekly payroll, and so on.

As it turns out, this change also has several technical benefits that improve the overall product experience. The first benefit is better financial reporting. With the old behavior, we could only estimate the broker/house split on unpaid payables—we couldn’t tell you the final split until you actually paid the broker. (If you made other payments in between, it could change the broker’s split.) With the new behavior, the split on every payable locked in, making your cash flow much more predictable.

This change has also allowed us to implement new features that make it easier for users to issue “corrections” on existing vouchers. For example—if a deposit is applied by mistake or for the wrong amount, it can easily be adjusted or deleted. Rather than “rewriting history” by adjusting existing broker payables and payments, Buildout can generate new payable corrections for the affected brokers. Because commission plans are based on payables, this automatically brings the broker to the correct plan progress, without impacting the split on any past payments. The new payable will account for any amount underpaid (or overpaid) to the broker, so you can pay (or collect) that money.

With payable-based commission plans, all of this is possible directly in the application, so you can correct errors on your own without needing to contact Buildout Support.

If you have Buildout’s new Manage & Close package, then we have good news: You are already using payable-based commission plans!

If you are a legacy Back Office customer that has not yet upgraded to Manage & Close, you may still be using the old functionality. We have been migrating Back Office customers to payable-based plans on a rolling basis—unless you have been in contact with our team about a migration, you probably aren’t using payable-based plans today. If you’re unsure, feel free to reach out to Buildout Support.

Migrating is easy! Contact Buildout Support to let them know you’d like to migrate, and we’ll schedule a time to run the migration in your account. The migration process is simple—it only takes a few seconds and runs entirely in the background, so you won’t experience any downtime. Our team will contact you when the migration is complete.

On March 18, 2024, all customers will be migrated to payable-based commission plans. This will ensure that everyone has access to the latest features enabled by this change (improved reporting, deposit adjustments, etc.) and better enable our development team to continue improving the product experience.

If you have concerns about this change or prefer the old behavior, please contact Buildout Support. We’ll connect you with a member of our product team so that you can ask questions and share your feedback.