A consultant’s suggestion that listing alerts powered by data multiple listing services provide to Realtors Property Resource could help lenders take business away from real estate brokerages’ own mortgage operations has sparked an ongoing debate over the use of MLS data.
Last month, real estate information and technology firm Lender Processing Services Inc. (LPS) announced a new service, which provides loan servicers with a notification when a property in their loan portfolio is listed in an MLS. The "It’s Listed!" alerts rely on MLS data from RPR, a National Association of Realtors subsidiary.
In a blog post Friday titled "WTF RPR?" Brian Boero, a principal of real estate marketing, design and strategy firm 1000watt, said the deal means the brokers who own those MLS listings may "get hosed."
"What can happen here, in consequence if not intent, is that broker listings are enabling lenders to capture mortgage business ‘upstream’ from brokers’ own mortgage operations," Boero said.
"And if you know anything about real estate brokerage these days, you know that mortgage origination is a vital profit center for many companies."
Many large brokerages have mortgage lending arms or an ownership stake in a mortgage company through an affiliated business arrangement (AfBA).
In a response to the 1000watt blog post, RPR CEO Dale Ross said Boero’s post had "misconstrued" a press release about the deal.
"The author of the blog appears to have assumed that the intent of the product is really to market new loans to homeowners, and thereby undercut a business that many brokerage firms have a vested interest in," Ross said.
"Any reading of this press release does not support the conclusions of the blogger. Nevertheless, we are aware that the post has garnered some discussion, particularly among brokerage firm owners. We believe it is important to invite a comparison of the two articles in order to make sure the facts are clear."
Ross noted that marketing to homeowners is prohibited by RPR’s MLS license agreements and is inconsistent with RPR’s mission to support the business of Realtors and their firms.
Boero responded to Ross’ post Wednesday.
"If ‘misconstrued’ means I pointed out a potential consequence of this deal, and offered my opinion on that, then I need to restate the obvious: I am not on the RPR (public relations) team," Boero said.
He noted that LPS’ press release on the deal stated, "The solution can also help servicers retain their customers by giving their lending departments a heads-up when current borrowers have listed their properties."
Both Boero’s and Ross’s original posts have garnered positive and negative comments, though some may not be as genuine as others. In the comment thread for Boero’s ‘WTF RPR?’ post, Jeff Bernheisel, market project manager at 1000watt, said he discovered one commenter defending RPR, "Katie," was actually Pamela Bouterse, who provides tech support for RPR.
In a statement to Inman News, Mike DelGaudio, RPR’s head of support, said: "I want to go on record and say that this action was in no way condoned or authorized by anyone at RPR. The poor judgment of this help desk representative has been addressed."
Russ Bergeron, CEO of Lisle, Ill.-based MLS Midwest Real Estate Data LLC (MRED), pointed out in a comment on Ross’ blog post that the product LPS is offering lenders is RPR’s "Match and Append," in which brokers’ listings are matched against lenders’ portfolios. Match and Append is one of two analytics products offered by RPR; the other is an automated property valuation called a Realtor Valuation Model (RVM).
"If a broker with a lending arm wants to buy this service, they could. But they could just use their MLS data to do the same thing," Bergeron said in a comment verified by Inman News.
Last month, residential real estate consulting firm WAV Group Inc. released a white paper concluding that larger real estate brokerages are missing opportunities to provide their clients with ancillary services such as mortgage and title insurance due to incomplete or disorganized client databases and lack of communication between different departments.
Brokerages that employ predictive analytics should be able to anticipate when the time is ripe to contact past clients, because they may be ready to trade up or refinance their mortgage, said Victor Lund, WAV Group’s founding partner.