Compare Rocket Homes and Opendoor Brokerage
For Sellers
For Sellers
For Buyers
For Buyers
Answer: Both Rocket Homes and Opendoor Brokerage function as a referral fee network that enables broker-to-broker collusion with use of blanket referral agreements.
Buying and Selling with Rocket Homes
WARNING: Unlawful Kickbacks, Broker-to-Broker Collusion, False Marketing, Wire Fraud, Price Fixing.
Rocket Homes) is a broker-to-broker collusion scheme, where "partner agents" unlawfully agree to pay massive kickbacks to receive your information and engage in market allocation, consumer allocation, false advertising, unlawful kickbacks, wire fraud, and price-fixing practices in violation of, inter alia, 18 U.S.C. § 1346, 18 U.S.C. § 1343, 15 U.S.C. § 1, 15 U.S.C. § 45, 12 U.S.C. § 2607, 12 C.F.R. § 1024.14. As a consumer, you will always significantly overpay for Realtor commissions subject to hidden kickbacks and pay-to-play steering promoted in this scheme.
United States federal antitrust laws prohibit consumer allocation and blanket referral agreements between real estate companies.
Be smart; do not allow your information to be "sold as a lead" to a double-dealing Realtor in exchange for massive commission kickbacks paid from your future home sale, or your future home purchase.
Rocket Homes is a referral fee network designed to collect fees by matching consumers with local real estate agents willing to participate.
Rocket Homes operates as a licensed Michigan real estate brokerage Rocket Homes Real Estate LLC License 6505-346028, but it does not produce any services that are typically offered by real estate agents and does not represent consumers when buying or selling real estate in any State.
When consumers submit information to Rocket Homes, this information is simply sold to real estate agents who are willing to pay for it with 25%-40% share of their commission.
Rocket Homes Pricing
Rocket Homes revenue comes from referral fees and sale of user data.
Listing Services
- This Service Does Not Represent Sellers
Buyer's Agent Services
- This Service Does Not Represent Buyers
Rocket Homes Editor's Review:
Rocket Homes is a Michigan real estate broker that collects an undisclosed referral fee (estimated at 25%-40% of agent’s commission) from all real estate agents that participate. This fee makes it hardly a free service for anyone since referral fees are inevitably passed down to consumers.
More importantly, Rocket Homes is a real estate agent that “does not engage in actual real estate broker services.” Rocket Homes systematically applies pay-to-play bias towards all matching results, meaning, only real estate agents that have agreed to pay a referral fee are matched with consumers.
Rocket Homes audits all transactions because it needs to find out how much money real estate agents receive in commissions, inevitably collecting private details of consumer’s agreement for home purchase or sale.
Rocket Homes further claims to match consumers with “top-rated professionals,” but there is absolutely no third-party evidence for this. Rocket Homes Terms of Service directly states that “it does not guarantee or warrant the products or services of other product or service providers to whom it may refer you, including, but not limited to, real estate brokers/agents, lenders and escrow/settlement companies.”
The main qualification for real estate agents who participate with Rocket Homes is their willingness to pay a referral fee. Rocket Homes is an affiliated brokerage of Quicken Loans. Quicken Loans is unable to collect referral fees from real estate agents directly due to rigid RESPA regulations. Instead, Quicken Loans is using Rocket Homes’s license as a loophole to bypass RESPA provisions that were designed to protect consumers from illegal kickbacks between real estate agents and mortgage companies.
Rocket Homes suffers from an incredibly poor Privacy Policy. Company states: “we will share your personal information (such as your name, address, telephone number and e-mail) to allow third parties to contact you (even if you are previously listed on any state, federal or corporate do-not-call list) regarding their products or services that include mortgage, moving companies, telephone service providers, internet service providers, cable and satellite television service providers, and real estate agents.”
Rocket Homes plays hidden referral fees down to consumers, but it rigidly locks every participating real estate agent to the back-end of every contract. As a licensed real estate agent that doesn’t perform any real estate services or takes any responsibility for the transaction, it is not entirely clear how Rocket Homes works under the Business and Professions Code and RESPA.
Clearly, real estate agents only sign-up with Rocket Homes because the price of the referral fee can be easily incorporated into their client’s agreement with excessive commissions.
Rocket Homes receives the lowest score because it simply sells user information to third parties without any clear benefit to anyone other than itself. There are exactly zero benefits to consumers when using this referral fee network - the only effects consumers gain with Rocket Homes are hidden fees, privacy concerns and blind matches with agents willing to part with 25%-40% of their commission. This model incorporates in itself everything real estate process shouldn’t be. Rocket Homes must be well aware of these issues but continues to operate on pay-to-play methodology in order to collect fees that needlessly make home buying and selling more expensive.
Where does Rocket Homes operate?
Buying and Selling with Opendoor Brokerage
WARNING: Unlawful Kickbacks, Broker-to-Broker Collusion, False Marketing, Wire Fraud, Price Fixing.
Opendoor Brokerage) is a broker-to-broker collusion scheme, where "partner agents" unlawfully agree to pay massive kickbacks to receive your information and engage in market allocation, consumer allocation, false advertising, unlawful kickbacks, wire fraud, and price-fixing practices in violation of, inter alia, 18 U.S.C. § 1346, 18 U.S.C. § 1343, 15 U.S.C. § 1, 15 U.S.C. § 45, 12 U.S.C. § 2607, 12 C.F.R. § 1024.14. As a consumer, you will always significantly overpay for Realtor commissions subject to hidden kickbacks and pay-to-play steering promoted in this scheme.
United States federal antitrust laws prohibit consumer allocation and blanket referral agreements between real estate companies.
Be smart; do not allow your information to be "sold as a lead" to a double-dealing Realtor in exchange for massive commission kickbacks paid from your future home sale, or your future home purchase.
Opendoor is a multi-state VC-backed real estate investor that operates across highly specific locations. Where available, Opendoor offers cash to sellers for homogeneous homes built after 1960 with a value between $125,000 and $500,000. Opendoor is the parent company of several real estate brokerages, including Opendoor Brokerage Inc., Opendoor Brokerage LLC, and Opendoor Texas Brokerage LLC (the “Opendoor Brokerages”).
Opendoor Brokerage is a referral fee network designed to collect fees by matching consumers with local real estate agents willing to pay it. Opendoor Brokerage operates as a licensed real estate brokerage in California under BRE License 02061130, and Texas under TREC License 9008105, but neither broker produce any services that are typically offered by real estate agents and does not represent consumers when buying or selling real estate in any State.
When consumers submit information to Opendoor Brokerage, this information is simply sold in exchange for an undisclosed fee with real estate agents in a process known as a “blind match.”
Opendoor Brokerage Pricing
Opendoor Brokerage revenue comes from undisclosed referral fees. Referral fees set by such networks range anywhere between 30%-40% of the entire agent’s commission. According to the company, "Opendoor Agent Partners only pay a referral fee to our brokerage if they close on a transaction with a referred seller or buyer. The fee is a percentage of the agent's commission, and averages 1% of property sale price unless otherwise noted in agent partner agreement."
Listing Services
- This Service Does Not Represent Sellers
Buyer's Agent Services
- This Service Does Not Represent Buyers
Opendoor Brokerage Editor's Review:
Using its website, Opendoor Brokerage engages in a process known as price fixing because it sets rebates for independent real estate professionals using the network.
Opendoor Brokerage refers consumers to third-party agents that can represent them in home purchase or sale (“Opendoor Partner Agent”) and requires buyer’s agents to offer certain discounts or promotions contingent upon working with the referred consumers.
Opendoor Brokerage receives a referral fee, around 1% of the home price, likely 30%-40% of Partner Agent's entire commission when referring consumers to list or buy a home with an Opendoor Partner Agent. Opendoor Brokerage requires Opendoor Partner Agents to offer 1% of the purchase price to buyers at closing in the form of a commission rebate. The amount is subject to a minimum buyer’s agent commission to Opendoor Partner Agents of $3,000, which means it is calculated as the lesser of either 1% of the price of the property consumer buys, or Opendoor Partner Agent’s commission minus $3,000. According to Opendoor Brokerage, this amount may be prohibited or reduced on the basis of the purchase type (e.g., short sale), lender requirements, loan type (e.g. FHA, VA), or the law.
For purposes of the present discussion, brokerage fees are always negotiable and no broker should set rates and rebates for other brokers. Each firm should establish its own policy as to its fee structure and charges, amount of commissions, and rebates.
"Agent Partners only pay a referral fee to our brokerage if they close on a transaction with a referred seller or buyer. The fee is a percentage of the agent’s commission, and averages 1% of property sale price unless otherwise noted in agent partner agreement. Opendoor Agent Partners are eligible to receive both buyer and seller referrals. Actual volume by referral type may vary over time. The Opendoor Agent Partner program is a broker-to-broker client referral partnership and is supplemental to your existing brokerage affiliation." Source: Opendoor Brokerage website.
By setting buyer's rebates for other brokers across many regions in the United States, Opendoor Brokerage operates with a sole purpose to collect referral fees, where such service effectively results in lower quality of service, pay-to-play bias, and a "blind match" with agents willing to participate.
With Opendoor Brokerage consumers have zero control over what agents the company shares their information with. Opendoor Brokerage simply subjects a real estate transaction with an additional referral fee that is equal to 1% of the home price. This fee is paid directly by the Opendoor Agent Partner to Opendoor Brokerage for failing to deliver a seamless consumer selling experience. Remember, Opendoor claims to offer consumers to buy homes directly as a revolutionary approach to home selling, instead, it systematically sells inquiries that it is unable to meet to random Opendoor Agent Partners for a fee.
Consumers can expect to significantly overpay for the transaction in the form of a higher commission with Opendoor Agent Partners. Even after consumers take into account a price-fixed amount in commission rebate, Opendoor Agent Partner is still required to pay a sizable referral fee, which means that same agent is able to offer a much better rate when approached directly.
For sellers, Opendoor Brokerage does not currently price fix listing rates, so consumers are likely to be referred to an agent who charges the highest commission possible - a "standard" 6% listing rate. There is little incentive for Opendoor Brokerage to connect consumers with the best and most competitive listing agents. Instead, Opendoor Brokerage aims to receive the highest referral fee possible by steering consumers toward a very limited set of agents who have a signed Referral Fee Agreement with Opendoor Brokerage.
Instead of being "sold as leads" consumers looking for a competitive and fair representation can consider negotiating directly with real estate agents, or with help from unbiased consumer-focused online services that do not collect referral fees.