The New Zillow Referral System

Featured Video Play Icon

Zillow has come out with a way to commoditize consumers through their new referral system.  What are your thoughts on it?



  • I believe it is only a RESPA violation if Zillow receives the referral fee, not the agent. Rather humorous that you think this is deceptive and unfair to the buyer…the entire Zillow process is based upon buyers clicking on agent info, when in reality the agent has no relationship to, or knowledge of, that property which is clearly deceptive in the first place.

    George May 17, 2016 4:24 am Reply
  • Not a RESPA violation. For years, Realtors, have referred POTENTIAL business to each other. RESPA clearly refers to SETTLEMENT (closing) procedures and services. You don’t have a settlement, until you have a transaction to settle; anything prior to that is not affected by RESPA.

    Reggie Fluker, MBA May 17, 2016 5:14 am Reply
  • Not completely true, George. It is a RESPA violation for us licensed real estate agents to give a kickback or referral fee from anyone who refers a client to us other than another real estate licensee. To receive a referral fee from a real estate licensee, or to pay a real estate licensee a referral fee is not a RESPA violation. However, when I receive or give a referral, it is to/from someone out of state who actually knows the client and that client has asked for a referral! What Zillow is doing is unknowingly to the client selling client leads from one real estate licensee to another. I don’t see it as a RESPA violation as much as I see it as unethical or on the verge of sleezy.

    Vicki S. May 17, 2016 5:44 am Reply
  • It is common for Brokers to refer clients to other Brokers for a fee. However, having Zillow procure the Clients and then have the Brokers collect a fee? There may be an issue, but it is not identified in RESPA. RESPA is geared towards the Lending institutions. They cannot charge a referral fee to Brokers. Zillow is just trying to wiggle every angle to get Realtors to pay for their leads.

    carrie May 17, 2016 6:51 am Reply
  • Furthermore, you need to have a RE License in order to collect a referral fee. I think Zillow is stepping on the line here–but I see it as no more than one of your clients sending his relative to you and you earning a commission as a result. Do we like Zillow –no. Are agents paying them to stick around–yes.

    carrie May 17, 2016 6:56 am Reply
    • I think Zillow is just providing a web service, the agents keep the referral fees. Not sure how that would work but otherwise they are violating State laws everywhere. Why agents pay these people is beyond me. I get some leads in off of Zillow and they are the worst leads as far as quality. I used to tell my buyers I am doing an intervention if they look at Zillow because their info was not refreshed and often outdated. Now my buyers are telling ME Zillow is a poorly run site. So, Zillow has shot itself in the foot as far as credibility of their information.

      Diane Balsara May 18, 2016 5:20 am Reply
  • Hi Frank & Brian … A really BIG thank you for your video ! I really like your approach and very interesting comments ! Could you please take it one step further now ? Please contact the National Association of Realtors for their feedback/opinion and let everyone know. Thank you very much in advance for your help !

    Douglas Ashley May 17, 2016 7:07 am Reply
  • Douglas Good idea, how about taking it one step further and asking the CFPB what they think?

    James May 17, 2016 2:57 pm Reply
  • I suspect as soon as the CFPB targets Zillow this will be a moot point. My Compliance Officer can’t even see how it’s not a violation for lender referrals. This is just going to paint a bigger target on Zillow.

    Michele May 18, 2016 7:34 am Reply
  • You had it right. Nothing is deceptive anymore. Just look at Wall St, our elections, or Representatives. The Criminal Corporate Oligarchs and Criminal Government Oligarchs get to compete to see who can consolidate all the debt paper and human capital wages slaves. The joys of neofeudalism/neofascism.

    Wake up you gotta make money.

    Turnip Head May 18, 2016 9:18 am Reply
  • Wow, lots of going back and fourth here.
    I for one don’t like Zillow, I used their services for 6 months and the only leads I reveived were mobilhomes leads or leads on my own listings. After $6k in advertising not one real lead, a joke if you ask me. With that being said, they are not violating any laws. Since they are not collecting any fees, no violations. I truly hope the RE agents/brokers on here posting that this is a violation does not make the same mistakes with their clients and contracts. For the agents / brokers posting on here, you should clearly know this one, if not you need to take another 45 hour brush up. If your a owner of a company then I’m sure your using a referral company for your agents to send and receive out of start referrals. Remember when their fees jumped to 50+% of the referral? Again any time we can find dirt on Zillow and try to get them out of our business I’m in, this one is not one of them. For the two guys doing the show? You guys need a 101 in Real Estate to better understand how our business really works.

    James May 18, 2016 10:00 am Reply
  • Wow! Okay, let’s get one thing straight. RESPA never regulated broker to broker referral fees between real estate brokers for their referral of a client to another broker. What RESPA did and does do is regulate the UNETHICAL practice of REAL ESTATE Brokers and their REAL ESTATE Agents demanding lenders pay them, the real estate broker or agent, a referral fee to do the loan for the buyer. OR for these same unethical real estate agents demanding referral fees from the Title Companies, Escrow Companies, Appraisers, etc. After 30 years as a lender I still get these same demands from real estate agents!

    Now for the flip side. YES there were and are just as many Lenders, Title Companies, etc., offering to pay these fees for the purpose of locking out their competition from the real estate office. EVERY major bank and many mortgage bankers have been guilty of this practice at one time or another. The so called “marketing agreements” between banks and real estate brokers are a good example of how this is still going on. Unethical?…ABSOLUTELY!; Illegal?…DEFINITLY should be!

    Michael May 18, 2016 11:53 am Reply
  • Is it a RESPA violation. Potentially yes. Sure agent to agent referral fees paid thru the brokers have been a long standing practice and don’t violate RESPA. However, in this case the thing to think about is that Zillow say it gets nothing — but it does, because it is premier agent to premier agent and Zillow charges those agents a fee. Just like the crack down on Mortgage offices alledged vioaltion for Rental fees paid to the broker sometimes at other than fair value. Isn’t that what we have here and to the exculsion of other agents who are not premier agents.

    Dean May 18, 2016 1:26 pm Reply

Leave a Comment

Your email address will not be published. Required fields are marked *


Menu Title