SEATTLE–A new lawsuit has been filed against Zillow alleging the company tied access to its Premier Agent and Flex leads to referrals for Zillow Home Loans, in violation of state and federal laws.
Zillow is facing a class-action lawsuit that claims the company used its powerful lead generation programs to steer homebuyers toward its own mortgage business — and rewarded agents who went along, Reuters reported.
The complaint, filed Nov. 7 in federal court in Seattle, alleges that Zillow violated federal and state consumer protection laws by creating a system of “kickbacks” and incentives for agents, linking Zillow Home Loans referrals to leads.
“Specifically, the lawsuit claims Zillow’s actions violate the Real Estate Settlement Procedures Act (RESPA), the Washington Consumer Protection Act, as well as aiding and abetting breaches of fiduciary duty by real estate agents,” the report states.
Pressure Alleged
The lawsuit alleges Zillow pressured agents in its Premier Agent and Flex programs to steer buyers to Zillow Home Loans for pre-approval. Agents who sent more clients to Zillow’s mortgage arm were rewarded with extra or higher-quality leads, while those who didn’t could lose access to the lucrative Flex program, the filing claims.
Buyers, meanwhile, were allegedly steered toward Zillow Home Loans without realizing their agent’s business depended on it. The complaint states that “Zillow’s system harms consumers, who are robbed of the disinterested advice of their fiduciary real estate agent, and instead are unknowingly steered towards ZHL’s limited and often uncompetitive mortgage products.”
Allegedly Part of Broader Strategy
The filing connects the alleged conduct to Zillow’s broader growth strategy, citing its February 2025 investor materials that describe a “housing super app” designed to “capture every stage of the home-buying journey on a single platform,” according to Reuters.
The plaintiff is Araba Armstrong, a first-time buyer from Anchorage, Alaska, says she was connected with an agent through Zillow’s platform and, “at that agent’s direction, obtained mortgage pre-approval and subsequently a mortgage loan from Zillow Home Loans.” The complaint alleges that she “was not informed of Zillow’s quotas, incentives, or requirements linking the agent’s access to Zillow leads to referrals or pre-approvals with ZHL.”
The suit is seeking class action status.
