Rocket Homes Real Estate, a real estate affiliate of Rocket Companies, is being investigated by the Consumer Financial Protection Bureau (CFPB) for possibly violating the Real Estate Settlement Procedures Act (RESPA) when it charged fees for referring Quicken’s mortgage clients to real estate agents, according to officials.
Syndicated columnist Lew Sichelman reported Sunday that Dmitry Shkipin of HomeOpenly.com alleged that Rocket Homes was receiving what amounted to illegal kickbacks while violating consumer protection laws, market allocation practices, and antitrust laws.
Shkipin filed a complaint with the Federal Trade Commission, citing RESPA’s bylaw that it is illegal for industry companies to collect money without providing “meaningful” services.
In the lawsuit, Shkipin alleged that a number of lenders operate “paper brokerages” to squeeze fees from real estate agents, which are passed onto the consumer, who pays for poor service.
“Any agent who chooses not to participate in such schemes risks losing ‘free’ business, and such an environment is highly poisonous to a healthy real estate representation market,” Shkipin said, according to Sichelman’s column.
Shkipin claims that under RESPA, referral payments are only permitted when all parties are acting on behalf of brokerages. Shkipin maintains that instead of representing customers and helping them buy and sell homes, Rocket “actively disengages” from those activities so that partner agents won’t compete for the clients.
A response emailed to HousingWire from Rocket Homes claimed the allegations are “egregiously misstated,” and said Shkipin was merely trying to “gain industry relevance.”
“A simple search of his name reveals a history of Shkipin imploring the government to consider legal action against large companies including Amazon, Uber, Lyft, Redfin, Opendoor and others to the benefit of his fledgling startup,” read the statement.
“We have and will continue to cooperate with the CFPB, and are confident they will confirm we are fully complying with applicable law.”
Rocket Homes officials claimed its standard business practices include matching clients with “experienced, vetted, top-performing agents” near them who have demonstrated their ability to provide a positive client experience. Rocket Homes then acts as the concierge for the client, assisting and checking in throughout the home buying process.
“If the assigned agent isn’t a good fit, we will assign a new agent that better meets the client’s needs,” read the statement. “In all respects, Rocket Homes is a fully operational real estate brokerage performing various levels of brokerage services for its many clients.”