royalty advace - service: is that serious??

[gitarrero]

hi folks,I've just read about http://www.royaltyadvance.comthey offer to advance royalty advances (e.g. if a composer has royalties in the pipeline, they advance the funds).since I'm living in switzerland/europe it easely takes 2-3 years for royalties from the U.S. to finally come in my hands, so that service sounds interesting.my question: does anybody know royaltyadvance.com, are the serious? any experience with them?I also ask myself from what they live - I didn't see anything of a commission they take. I asked this question to them directly, but if anybody here knows it, please post it.thanks!martin

[ggalen]

It's got to be a loan service. They have to take a percentage, and probably more than a bank would.

[anne]

Hi Martin -From reading the FAQs closely it looks like there are 2 methods of payment that they offer; a cash advance (which is a loan based on the royalty payments coming to you) or the option to sell them your expected royalties. If you go to http://www.royaltyadvance.com/faq.htm#q12 you can read through it, but it is just a way of speeding up the process, like a payday loan operation for royalty payments. They loan you the anticipated value of the royalty; they get paid back directly from the PRO until your advance (i.e. LOAN) is paid off. Think of it like this - you go to a bank for a loan, they give you money, your boss pays them directly, the bank keeps your checks until the loan is paid off. I can see where this could be useful, but you are giving up a percentage of your money for the service, or selling the royalty out completely for the full value. They have contact info - let me know what you find out! (877) 833-FUND toll-free or (310) 275-3636(310) 275-1033Parviz@RoyaltyAdvance.comOffice Address9200 Sunset Boulevard, Suite 1232Los Angeles, CA 90069 Mailing AddressPO Box 7576Beverly Hills, CA 90212

[gitarrero]

hi ann,yeah I noticed that too (two methods of payment - buyout & "loan"). and yes it's clear that they take a kind of percentage.there answer: "OUR SOURCE OF INCOME IS FROM AN INTEREST CHARGED ON THE ADVANCEMENT GIVEN."fine - the question is how high that interest is (% of the advancement). let's see what they answer.cheers,martin

[ggalen]

Quote: the question is how high that interest is (% of the advancement). let's see what they answer.My guess: 20%

[gitarrero]

acutally, it's 5%. I got their response.

[neuphoria]

well if you have any kind of history of revenue you PRO will give you an advance. They will base it on the last few quarters; also if you show upcoming uses (they can verify by show/episode, etc.) you can possibly squeeze some more out of 'em. and without interest -- they just take it out of your next payment(s).

[sgs4u]

Quote:well if you have any kind of history of revenue you PRO will give you an advance. They will base it on the last few quarters; also if you show upcoming uses (they can verify by show/episode, etc.) you can possibly squeeze some more out of 'em. and without interest -- they just take it out of your next payment(s).I had a buddy that did that in Canada. I was surprised when Socan wrote him a 5 figure check. So it does happen.

[gitarrero]

Quote:well if you have any kind of history of revenue you PRO will give you an advance. They will base it on the last few quarters; also if you show upcoming uses (they can verify by show/episode, etc.) you can possibly squeeze some more out of 'em. and without interest -- they just take it out of your next payment(s).that's true - I read that in an interview with a now famous songwriter in germany. he borrowed 5000 "german mark" (deutsche mark - the currency back in those days) to build up his studio.

[zircon]

5% actually isn't so bad, I can imagine if you were in a tight situation financially... eg. some sort of medical problem, family emergency, studio theft/fire... that it would be quite useful.