The owner of NRT, America’s largest real estate brokerage, plans to launch a high-tech mortgage business, believing the new firm will give a leg up to NRT agents.
Realogy Holdings Corp. has formed an agreement to launch a joint venture with mortgage company Guaranteed Rate Inc.
The new company will be called Guaranteed Rate Affinity, and will replace a previous joint venture between Realogy and PHH Mortgage. Guaranteed Rate Affinity is expected to open its doors in June of this year.
The joint venture will “elevate” the overall “real estate agent value proposition” of agents who work at NRT, Realogy’s company-owned brokerage arm, NRT CEO Bruce Zipf said in a statement.
Nearly 50,000 agents work at NRT, which owns and operates many Coldwell Banker Real Estate and Sotheby’s International Realty offices. NRT also operates The Corcoran Group, Citi Habitats and ZipRealty.
Guaranteed Rate Affinity “will originate and market its mortgage lending services” to NRT and Cartus, Realogy’s relocation subsidiary, as well as to other brokerage and real estate companies and a broad consumer audience –“while leveraging its end-to-end online platform to drive growth in those markets,” Realogy said in a press release.
Guaranteed Rate Affinity would replace a previous joint venture between Realogy and PHH Mortgage called PHH Home Loans LLC. The deal provides for Guaranteed Rate Affinity to largely absorb PHH Home Loans LLC.
It’s subject to the closing of a purchase agreement under which Guaranteed Rate Affinity would acquire certain assets of the mortgage operations of PHH Home Loans LLC, including PHH Home Loans LLC’s regional mortgage-origination offices, relocation division and employees.
PHH Corporation, the owner of PHH Mortgage, said in a press release that its decision to sell those assets was “a result of our review of strategic alternatives.”
Word of the deal comes after Realogy and PHH Mortgage Corp. won a protracted court battle with the Consumer Financial Protection Bureau (CFPB) in October 2016 over allegations that the two used their joint venture to channel kickbacks to settlement services providers.
Realogy appears to have selected Guaranteed Rate as a partner for the new venture, in part, due to the mortgage company’s technology.
“As we evaluated potential new options for our mortgage origination venture, Guaranteed Rate was clearly the right strategic partner to help our company-owned brokerage business and its affiliated sales associates offer an innovative and streamlined mortgage process built on best-in-class technology,” said Realogy CEO Richard Smith in a statement.
Bruce Zipf, NRT’S CEO, called the new venture “a positive development that helps to elevate NRT’s overall agent value proposition.”
He said that Guaranteed Rate has used top-notch technology and customer service to build a trusted brand.
“We look forward to working with them and allowing our independent sales associates to offer their clients access to an innovative online experience,” Zipf said.
