The Washington Post reports:
According to Zillow, the Consumer Financial Protection Bureau has concluded a two-year investigation into the company’s “co-marketing” arrangements that allow mortgage lenders to pay for portions of realty agents’ monthly advertising costs on Zillow websites. In exchange for the money, lenders are presented in agents’ ads to site visitors as sources of financing, which ultimately generates leads and new mortgage business. Consumers probably are in the dark about the lender’s financial relationship with the realty agent unless they know to click on a question-mark icon after the promotional words “ask these lenders about financing.”
Although the CFPB declined to comment for this column, Zillow confirmed that the bureau has threatened it with legal action if it does not agree to a settlement. The CFPB has not publicly detailed its specific reasons for pursuing Zillow, but the company says the allegations involve the Real Estate Settlement Procedures Act (RESPA) — which prohibits kickbacks in exchange for business referrals — and a section of the Consumer Financial Protection Act that prohibits “unfair, deceptive or abusive” practices.
The full article is here.
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