Zillow Flexโข program and Home Loan Referrals: โคA โCloser Look
The zillow Flex program, designed to โคconnect agents with potential clients in exchange for a portion of their commission (typically 25-40% upon closing), is facing scrutiny over its requirements regarding referrals to zillow Home Loans (ZHL). โคRecent reports indicate a tightening ofโ rules concerning how agents connect homebuyers with financing options.
Initially, participationโ in the Flex program required prospective buyers toโ simply have a brief phone call with a ZHL agent. However, agents speaking toโข Theโฃ Capitol Forum โ report that Zillow has recently increased this โrequirement, now mandatingโ that โคroughly โ10%โฃ ofโข leads generated through theโข programโ obtain a mortgage preapproval.
This preapproval requirement is tied โขto โan agent’s standing within the Flex program. Teams failing โฃto meet โthe quota of preapprovals risk receivingโ fewer leads, and โrepeated failures โcan lead to removal from the program. Conversely, โฃteams exceeding the requirement are reportedly rewarded with increased lead volume and quality. Zillow maintainsโฃ a team leaderboard ranking agents โbasedโ on predicted conversion rates and theโ number โขof ZHLโฃ preapprovals secured.
Agents interviewed expressed concerns that this system โขincentivizes steering homebuyers towards โZHL, potentially violating the Real Estate Settlement Procedures Act (RESPA) โdue to a lack of disclosure regardingโฃ the financial incentive.They feel “forced” to connect buyers with ZHL services. Concerns were also โคraised about โpotential financial disadvantages forโ buyers, particularly first-time homebuyers, who may miss out on rebate programs or alternative mortgage productsโข offered by other lenders.
Furthermore, Zillowโ requires agents โto manage โFlex โขleads through the Zillowโข app or Follow Upโค Boss, a CRM platform owned by zillow Group, leading to concernsโ aboutโ increasedโ oversight of agent-buyer interactions.
In โคa statement to HousingWire,aโค Zillow spokesperson emphasizedโ the company’s commitmentโค to consumer experience,clarity,and operating in compliance with applicable laws. The spokesperson โstated that Zillow โคprioritizes providing consumersโข with โfacts and services they requestโข throughout their real โฃestate journey and that the program considersโข multiple factors beyond preapprovals whenโ evaluating agentโฃ performance.