
The Consumer Financial Protection Bureau (CFPB) has leveled accusations against Rocket Homes, claiming the company engaged in a kickback scheme aimed at funneling business to its affiliated firms, Rocket Mortgage and Amrock.
The Jason Mitchell Group has also been implicated in these alleged violations of the Real Estate Settlement Procedures Act (RESPA).
Incentives and Allegations
According to the CFPB, from 2019 to 2024, Rocket Homes created incentives for real estate agents by offering rewards for referring clients to Rocket Mortgage and Amrock.
One striking example noted in the lawsuit is the distribution of “Dog Bone” gift cards valued at $250, which were granted to agents who brought in the most referrals for these preferred partners.
The claims extend beyond mere incentives.
The CFPB alleges that Rocket Homes restricted brokers from discussing competing lenders and trained agents to imply that clients’ transactions might be at risk if they entertained other mortgage options.
In response to these serious allegations, Rocket Homes has firmly denied any misconduct, maintaining that its goal is to assist homebuyers in making informed choices.
Challenges and Responses
Jason Mitchell, founder of the Jason Mitchell Group, has rejected a proposed settlement of $200,000 from the CFPB, stating his intent to challenge the allegations, as he feels they present a false narrative.
Moreover, the legal complaint details how Rocket Homes operated a referral network that nudged real estate agencies to steer clients away from competitor services.
This practice, according to the CFPB, inflated costs for consumers who used the network.
It is asserted that the company pressured brokerages to ensure that at least 80% of referred clients secured their mortgages through Rocket Mortgage, introducing penalties for those who fell short of this threshold.
Consumer Protection Focus
Rohit Chopra, the head of the CFPB, highlighted the importance of consumer access to competitive financial options, especially as housing costs continue to soar.
He emphasized that consumers should not face barriers when seeking the best financial deals available to them.
Source: Housingwire