Compare Zillow Flex Program and Ribbon

For Sellers

Referred Agents
Referral Fee
Zillow Premier Broker program does not provide real estate services to home sellers. Instead, this program matches consumers with various real estate agents in exchange for a 25%-40% referral fee. Zillow Premier Broker results suffer from pay-to-play bias because the network does not match consumers with agents unwilling to pay a significant part of their commission.

For Sellers

Not Applicable
No Rates
Ribbon does not offer services to sellers.

For Buyers

Referred Agents
Referral Fee
Zillow Premier Broker program does not provide real estate services to home buyers. Instead, this program matches consumers with various real estate agents in exchange for a 25%-40% referral fee. Zillow Premier Broker results suffer from pay-to-play bias because the network does not match consumers with agents unwilling to pay a significant part of their commission.

For Buyers

Cash Offer
Service Fee
It costs 1.95% to make a Ribbon Cash Offer. Cash Offer made with Ribbon is not free to buyers since the seller will have to account for the added fee when accepting an offer. Cash Offers stand-in program is highly selective and may come with added risks in case a buyer decides to back out of the sale. Buyers should carefully review their agreement with Ribbon.
Question: What is the difference between Zillow Flex Program and Ribbon?
Answer: Zillow Flex Program is a referral fee network that enables broker-to-broker collusion with use of blanket referral agreements while Ribbon is a stand-in cash offers program for buyers
Compare Zillow Flex Program and Ribbon for home buying and selling. HomeOpenly is an impartial and an open resource focused on trending real estate services, portals and start-ups.

First published: 17 February 2019
Last updated: 25 April 2021

Buying and Selling with Zillow Flex Program

Consumer Warning

Zillow Flex Program is a broker-to-broker collusion scheme, where all real estate agents agree to pay massive kickbacks to receive your information. As a consumer, you will always overpay for broker commissions subject to hidden kickbacks and pay-to-play steering promoted in their referral scheme. United States federal antitrust laws prohibit consumer allocation and blanket referral agreements between real estate companies. Do not allow your information to be "sold as a lead" between brokers in exchange for massive commission kickbacks paid from your future home sale, or your future home purchase.

Zillow Flex Program is a real estate referral fee network that is designed to collect undisclosed referral fees from real estate agents. Within this network, Zillow Group screens and refers consumers to real estate agents with a pre-existing "blanket" referral agreements. Zillow Group refers to this referral service as a Zillow Flex Program because it allows brokers to participate without paying any upfront costs to Zillow Group.

As a consumer filling out a contact form on the Zillow-owned (Zillow, Trulia, etc.) web site, "you authorize Zillow to make Real Estate Referral and acknowledge Zillow may be paid valuable consideration for facilitating such referral." Zillow Group does not disclose to consumers how much "valuable consideration" it receives from participating brokers. "The established referral fees are specific to each market in order to account for local pricing trends," according to Zillow.

Zillow Flex Program is a form of pay-to-play consumer brokering product that relies on the use of blanket referral agreements to pay for each referral. Blanket referral agreements between brokers are a per se violation of the Sherman Act. With Zillow Flex Program consumers are effectively pre-screened by Zillow and “sold as leads” to whoever is willing to pay for this information with a share of their commission.

Zillow Flex Program Pricing

Zillow Premier Broker does not offer paid services to consumers directly, instead, the portal generates revenue with estimated 25%-40% referral fees from real estate brokers. Zillow Group declines to disclose the exact fee amount.

Listing Services

  • This Service Does Not Represent Sellers

Buyer's Agent Services

  • This Service Does Not Represent Buyers

Zillow Flex Program Editor's Review:

This review is focused on the Zillow Flex Program program only. Two separate reviews are assigned to Zillow Instant Offers and Zillow MLS aggregator programs. Since Zillow was first founded, it has idolized itself as a real estate Internet company. However, with an introduction of Zillow Flex Program in 2018, this is no longer the case.

Today, Zillow acts as a "paper" real estate broker. This fact allows Zillow to receive referral fees from real estate agents across the United States.

Zillow operates under the following real estate brokerage license in the following States:

Arizona CO580407000
California 01522444
California 01980367
Colorado 100080923
Florida CQ1058944
Georgia 76885
Minnesota 40638657
Nevada B.1002277.CORP
North Carolina C30388
Texas 549646
Washington 21212
Wisconsin 835987-91

Real estate agents are allowed to pay one another referral fees with a narrow RESPA provision that is needed to allow individual agents to refer business to other individual agents outside their service area. Despite being registered as a broker, Zillow does not perform real estate services, it simply sends leads to specific agents within its network and uses a real estate license to collect a back-loaded referral fee in the process.

Referral fee revenue is 32x that of a regular advertisement revenue because it results in an economic process called reverse competition, where consumers suffer from elevated costs and lower service as a result. A referral network is anything but free.

The following are some telling quotes from Zillow itself and a Premier Broker program participants. These words speak for themselves.

  • "We receive listing and buyer referrals directly from Zillow's Premier Broker concierge services. These leads have been scrubbed and vetted before they are directly handed off to you." Source: Sonoma County RE/MAX Marketplace, Zillow Flex Program participant.
  • "We will validate all leads first, then send agent-ready buyers to you." Source: Zillow website.
  • "What happens if you miss a call? Don't worry. You won't lose your place in the queue and we will call you with the next connection we validate." Source: Zillow website.

Zillow Group does not disclose the exact amount in referral fees it collects from Premier Brokers, aside from stating that it is an "industry standard." Similar referral fee networks typically receive 25%-40% of the agent's total commission. This is a good reference for the amount in commissions consumers can expect to overpay for their real estate services with a Premier Broker. Zillow Flex Program is a pay-to-play process that harms the industry as a whole and makes buying and selling homes more expensive.

Why does the Zillow allow for such poor UX? There are thousands and sometimes tens of thousands in fees collected from each transaction effectively hidden in consumer’s commission.

Consumers in the United States have been systematically conditioned to a 6% "standard" commission structure, a non-negotiable fact that needs no justification. Unfortunately, this inefficiency alone breeds uncompetitive behavior where real estate agents can easily pay tens of thousands in fees because they are recoverable with a high commission.

Consumers are truly forgotten in this model as an afterthought. When these exigent commissions are amortized over the first five years of homeownership, these fees are the highest single expense line-item - more than the insurance, more than the interest, more than utilities. Clearly, real estate agents only sign-up with Premier Broker because the price of the referral fee can be easily incorporated into their client's agreement with excessive commissions.

RESPA allows for an exception for real estate agents if and only if “all parties are acting in a real estate brokerage capacity" so that individual agents can refer each other when they are out of the local area. This exception has now been turned up-side-down where a referral network does not act in the capacity of a real estate broker. Zillow Group simply uses a license to collect fees without any tangible services done as defined by said license.

Consumers looking to work with a legitimate real estate agent on fair terms should absolutely avoid Zillow Flex Program and never release their full name, email and a phone number to Zillow Group.

The issue of having all US residential real estate markets heavily subjected to these schemes results in noncompetitive behavior, higher costs to consumers and lower quality of service. Having agents "commonly" pay networks 25%-45% of their commission is the true reason why real estate is broken.

Zillow Group matches consumers with "great, amazing, top-producing, perfect agents" based on who first picks up the phone and who is willing to kick in a chunk of their commission, this is the main basis for this process.

What happens when this flawed revenue model is no longer sustainable due to competitive commissions entering the market? The next stage of real estate innovation will have to account for this reality. In play are now competitive open rates, flat fees and buyer’s refunds from highly qualified real estate agents.

Transparent commission rates will eventually bring and end to a pay-to-play phenomenon in the real estate process where programs like Premier Broker simply cannot exist.

Today, consumers should be careful and only negotiate with agents that have no referral fee agreements signed, this is the only way to negotiate for full service at a market rate.

Where does Zillow Flex Program operate?

Zillow Flex Program currently operates in select areas across Fort Collins, CO, Pueblo, CO, New Haven, CT, Norwich, CT, Phoenix, AZ and Atlanta, GA..

Buying with Ribbon

Ribbon is a multi-state stand-in cash-backed offer program that aims to help buyers when purchasing a home, it is not a real estate agent, nor is it an iBuyer.

Ribbon is a cash program for buyers that may help the buyer to make a competitive offer. Ribbon program also comes with added risks and sizable fees.

Despite the fact that the program costs an additional 1.95% service fee when used properly, Ribbon Cash Offer may be beneficial to the buyer in cases when a seller is highly motivated by a faster sale. If you are a buyer looking into this program, we recommend that you read the entire Editor’s Review for unbiased tips on how to navigate this process.

Ribbon Pricing

Ribbon also offers buyers Cash Offers stand-in program, where the company either backs buyer’s offer or buys a home and resells it back to the buyer for an added fee (1.95% service fee)

Listing Services

  • This Service Does Not Represent Sellers

Buyer's Agent Services

  • This Service Does Not Represent Buyers

Ribbon Editor's Review:

Ribbon is a consumer-focused cash-backed value-added proposition for home buyers in select areas where it operates. Ribbon claims that buyers are able to make offers to sellers that are less than the asking price due to the added security of each offer. In this review, we focus primarily on this claim when placed against the fact that the program costs an additional 1.95% in fees. Placing additional fees into real estate process almost never leads to savings, however, making secure offers does offer certain benefits. Using Ribbon Offers does not preclude the buyer from negotiating a buyer’s commission refund with their real estate agent.

Guaranteed Cash Offers
Ribbon offers buyers a Cash Offers stand-in program where Ribbon purchases a home outright from the seller on a buyer’s behalf, and sells it back at the same price to the buyer on an agreed upon closing date. Ribbon guarantees the seller that the home will close, and if it doesn’t, Ribbon will then buy the home for the same terms. Cash Offers stand-in program is not free, it is also highly selective.

Ribbon extensively qualifies clients with a complete financial background check prior to doing business. Cash Offers program also comes with added risks in the event the buyer decides to back out of the sale. Buyers should carefully review their agreement with Ribbon before participating in the Cash Offers stand-in program so to fully understand the fees and potential penalties for backing out of the Cash Offer once it is made.

In order to maximize their options, Buyers should utilize Ribbon Cash Offer alongside a traditional non-Ribbon Offer that does not include the added 1.95% Ribbon Fee. Ribbon allows this as an option and buyers should always place two offers on the table before the seller so that the seller can pick whichever option suits them the best. Unless a buyer places Ribbon Offer and non-Ribbon Offer before the seller, another buyer who makes non-Ribbon Offer may be at an advantage because it comes without the Ribbon fee.

If the seller chooses non-Ribbon Offer, they will not pay the Ribbon fee, but they still have an option to go with Ribbon Offer if they want.

If hustle and risk of placing a Ribbon Offers genuinely comes with added savings, buyers should theoretically be able to place a winning Ribbon Offer at 95% value of their traditional non-Ribbon Offer. This becomes the ultimate test - if the seller decides to accept a lower Ribbon Offer due to added security, buyer genuinely saves 5% in this type of transaction. If the Seller accepts a traditional non-Ribbon Offer, then this program didn’t help the buyer, but it didn’t cost anything either.

If the buyer only places a single Ribbon Offer on the table before the seller, there is nothing to compare savings against and, instead, all parties may have just wasted 1.95% on fees without any reason to do so. Before placing this review, we had asked Ribbon team for details about the program:

Question 1: Ribbon states that if the Buyer backs out from the purchase after making the Ribbon Offer they would lose the Due Diligence Deposit (if applicable) and Earnest Money Deposit. How much are these penalties, and how are these calculated? When are these applicable? Does this penalty remain in place if the appraisal comes in below the Ribbon Offer? Are there any other penalties for backing out of the Ribbon Offer?

Ribbon Answer: The buyer contributes their standard DD / EMD fees that are typically 1% of the purchase price. These are funds that are preserved and credited back to the buyer when they repurchase from Ribbon. Ribbon buys and reserves the home for the consumer buyer. If the buyer chooses not to purchase the home, these funds would be credited back if Ribbon resells the home back into the open market above the original purchase price. Less than 3% of buyers choose not to purchase the home after we step in to buy on their behalf so this is an uncommon outcome. Additionally, consumers requested that when we buy, to provide consumers with a 1-year lease so they have the peace of mind of the home they are living in. We introduced this feature and buyers carry standard responsible for a 1-yr lease that would terminate immediately upon their purchase of the home from Ribbon.

Question 2: Ribbon states that Ribbon Offer typically commands a 5% discount relative to competing bids which have financing contingencies. Do Ribbon terms allow Buyers to make two concurrent bids to the Seller - one set at 100% of the home price with typical financing contingencies as a non-Ribbon Offer and another as the Ribbon Offer made at 95% of the same offer amount? If the Buyer were to propose this option to Ribbon, what would the reply be?

Ribbon Answer: Yes, a buyer can make a Ribbon and Non-Ribbon offer. We believe consumers should have a choice in how they buy and we enable this for them. We have enabled this for other buyers and this is one of several ways in which we calculate the true cash discount rate.

Question 3: Ribbon states that Ribbon Offer typically commands a discount of 5% or more of the home price, when compared to the 1.95% Ribbon fee. Can Ribbon show proof of this statement? Is there a possibility that the Seller considers Ribbon fee a deterrent in light of a competing offer without the fee?

Ribbon Answer: We establish a cash discount based on the following methodology: where did the Ribbon offer clear relative to other offers received by the seller. We often receive this input from the listing agent. If not, we calculate cash discounts based on the predicted and actual appraisal value of the home.

Question 4: When Ribbon purchases the home, instead of the Buyer, Ribbon pays Buyer's Agent Commission under its own agreement with the Agent. In this scenario, Buyer's Agent does not take any risk nor has any added expense in case the Buyer backs out of the deal. This gives the Buyer's Agent, effectively, two clients instead of one. Why should the Buyer believe that this Agent is not looking out for her own interest since both Ribbon and the Buyer are represented by the same Agent and are subject to the same commission structure? How can the same Agent fairly represent two distinctly different Buyers in the same transaction?

Ribbon Answer: Ribbon stands in as the backup buyer to the original buyer represented by the realtor. If, and only if, the original buyer is unable to close on time, Ribbon stands in to purchase the home on their behalf at the exact same terms as the original offer. As such, we have zero conflict of interests as the original buyer sets the price and terms with their realtor. Ribbon provides, upfront, the max terms that we will back the home for (this includes, max purchase price, minimum DD/EMD fee, minimum DD time period and minimum time to close). The realtor represents the original buyer up until the point where the contract is assigned to Ribbon prior to close.

Ribbon clearly offers the buyer an interesting value-added alternative, despite the added 1.95% fee. Buyers should place two side-by-side Ribbon and non-Ribbon Offers to capture savings. These offers may be equal, or 5% less of each other, depending on how far the buyer wants to test the savings claimed by the program. Buyers should also fully understand all risks for backing out of a Ribbon offer before using the program. If the buyer makes only the Ribbon Offer without the non-Ribbon alternative, the added fee may simply backfire because the seller may accept another equal or lower traditional offer from another buyer.

Where does Ribbon operate?

Ribbon currently operates in select areas across New York City, Charlotte, Raleigh, Nashville, Atlanta, San Antonio.