Splitting commissions with reps, partners and sub-ISOs

• The house: the ISO that holds the funder agreements, pays for leads and carries the risk.
• The rep: the salesperson who worked the deal. Shops pay reps a percentage of what the house keeps, often around half, more for senior reps or self-sourced deals.
• A sub-ISO or referral partner: an outside broker or business that sent the merchant. Their share usually comes off the top, before the house splits with the rep.
• Fronters and closers: on teams where one person qualifies and hands off and another closes, the rep's share is divided between them.

• Commission splitA commission split divides the commission a funder pays on a deal between the house, the closer and any sub-ISO or referral partner, by agreed percentages.
• Sub-ISOA sub-ISO is a smaller broker or agent that sends deals through a larger ISO instead of contracting with funders directly, and splits the commission.

A $50,000 advance pays a total commission of $5,000 (10 points). A referral partner sent the merchant for 30% of the gross. The rep's plan is 50% of the house net. The rep worked with a fronter who gets 25% of the rep's share.

gross commission   = 5,000
partner (30%)      = 5,000 x 0.30 = 1,500
house net          = 5,000 - 1,500 = 3,500
rep share (50%)    = 3,500 x 0.50 = 1,750
  fronter (25%)    = 1,750 x 0.25 =   437.50
  closer (75%)     = 1,750 x 0.75 = 1,312.50
house keeps        = 3,500 - 1,750 = 1,750
check: 1,500 + 437.50 + 1,312.50 + 1,750 = 5,000

Change the order and the numbers change. If the rep's 50% were taken from the gross first, the rep would get $2,500 and the house would keep $1,000 after the partner. Neither way is wrong; leaving it unsaid is.

• Different rates for base and upsell. Some shops pay reps more of the upsell to reward pricing, or less to discourage overpricing.
• House leads vs self-sourced. A rep who brings their own merchant often gets a higher share than one working leads the house paid for.
• Renewals. Decide who gets paid when the original rep has left, or when a different rep works the renewal.
• Draws. A draw against commission is an advance on future splits; write down whether it is recoverable.

Most commission fights happen months later, over a clawback or a departed rep. A one-page split agreement for every rep and partner prevents most of them. It should say:

When you mark a deal funded, enter the Rep split (a percentage of the house net after the partner) and a Partner / referral with its Partner split (a percentage of the gross). The preview shows the partner, rep and house amounts before you save. A Default rep split and per-rep splits live on the Payouts screen.

The CRM records one rep and one partner per funded deal. If you split a rep's share between a fronter and a closer, note the arrangement on the deal. Payouts shows what is Owed now (the lender has paid), Waiting on lender and Paid out, so nobody is paid from money that has not arrived. See commission tracking.