Consumer group coalition recommends probes into Zillow, Compass 

This week in Washington, D.C., a coalition of consumer groups is calling for an investigation into two real estate industry giants while new legislation aimed at boosting funding for affordable housing is gaining support among some consumer advocates.

At HUD, the president this week appointed one person to serve as both assistant secretary and commissioner of the Federal Housing Agency. And at the Federal Housing Finance Agency (FHFA), Director Bill Pulte paved the way for Fannie Mae and Freddie Mac to accept VantageScore 4.0 credit scores and outlined a path for qualifying borrowers to drop "extra" mortgage insurance coverage.

Consumer groups urge investigations into Zillow, Compass

Nineteen consumer advocacy groups signed onto a letter asking state attorneys general to investigate two of the biggest players in residential real estate as part of a larger effort to "improve" housing market conditions across the country.

In a Sept. 16 letter, the coalition — which includes the Consumer Federation of America (CFA), the American Economic Liberties Project, the Open Markets Institute and many others — called upon the National Association of Attorneys General (NAAG) to "take up housing market integrity as a coordinated enforcement policy."

In addition to recommending an investigation into mortgage "kickbacks" and the establishment of a multistate group to coordinate on evidence gathering and enforcement activity, the letter specifically pushed for probes into Zillow and Compass.

Referencing an August settlement in the FTC lawsuit over Zillow's rental syndication agreement with Redfin, the coalition recommended that the NAAG look into Zillow's compliance with the deal and said the group should also "launch consumer protection investigations into dominant listing platforms for the full range of anticompetitive and deceptive practices that have made housing less affordable and less accessible." 

The letter suggested that Zillow's settlement with the FTC was an admission that the syndication agreement was "harmful" to consumers, an inference Zillow rejected. In a statement, the company said the letter "gets us wrong."

"Syndicating rental listings to Redfin got more properties in front of more renters, so they can search where they prefer," a spokesperson said. "If state attorneys general want to investigate listing access, inventory gatekeeping and practices that wall off consumers from the full market," the spokesperson added, "that investigation should start with the brokerages funneling listings into private networks, not the platforms fighting to keep listings open."

On the matter of private networks, the coalition also targeted Compass, recommending that the NAAG "enforce state laws requiring properties marketed privately to be listed concurrently on public platforms" and "review the Compass-Anywhere acquisition under state merger review statutes and challenge it where it reduces competition."

Compass declined to comment on the letter.

New bill pitches more affordable housing, down payment assistance funding

Earlier this month, Democratic Rep. Maxine Waters of California introduced new legislation that would increase the Federal Home Loan Banks' funding requirement for the Affordable Housing Program.

If passed, the bill would funnel about $300 million more to affordable housing development, home repair initiatives and down payment assistance, the CFA and the Coalition for Federal Home Loan Bank Reform noted in a news release.

CFA Director of Housing Sharon Cornelissen applauded the bill in a statement, calling it "an important step" while adding that Congress "should demand more given that the FHLBanks receive an estimated $7 billion in annual subsidies and tax breaks"

"Amid a dire housing affordability crisis, the public now only receives pennies on the dollar," Cornelissen said. "We look forward to working with Congress on additional reforms and initiatives that will bring this government-subsidized housing finance system back to its public mission."

Fannie, Freddie to accept VantageScore 4.0

Last week, Pulte announced that Fannie Mae and Freddie Mac will now accept mortgage credit scores via VantageScore 4.0 from all lenders. Both government-sponsored enterprises began accepting the credit scoring model in the summer of 2025.

Several industry groups commended the announcement, with the National Association of Realtors calling the decision "a major milestone for credit scoring" and the Mortgage Bankers Association dubbing it "an important step toward modernizing the credit scoring framework."

"NAR has been a steadfast proponent of the use of alternative data and credit competition for years," NAR EVP and Chief Advocacy Officer Shannon McGahn said, adding that, "in time, this important change may lead to better access and affordability for some homebuyers."

FHFA paves way for borrowers to drop 'unnecessary' insurance

On Sept. 15, Pulte announced that Fannie Mae will be adopting Freddie Mac's rule allowing mortgage companies to contact lenders if their home's value rises and makes them eligible to drop some of their mortgage insurance.

"If your Home is worth more, or you have paid the loan down far enough, you should be able to drop EXTRA Mortgage Insurance," Pulte wrote in a social media post.

Fannie Mae's prior guidance blocking borrowers from making contact about these options was "crazy," Pulte wrote. Moving forward, he added, borrowers will be able to "stop paying for coverage you do not need and keep the money."

NAR backs nominee for FHA, HUD roles

President Donald Trump this week nominated Matt Jones to serve as the new Federal Housing Agency commissioner and as assistant secretary at HUD.

Jones, who is currently the deputy assistant secretary for single-family housing at HUD, has "extensive experience in housing finance," McGahn said in a statement applauding the nomination.

"Jones has demonstrated his commitment to strengthening America's housing market through his service at HUD, the Mortgage Bankers Association and the Senate Banking Committee," McGahn added. "We look forward to working closely with Deputy Assistant Secretary Jones and the administration to continue to advance policies that increase housing supply and improve affordability for families across the country."