Zillow just can’t seem to get a break these days.
The mega real estate portal has become the target of another class-action lawsuit, this time over alleged illegal kickbacks to brokers in the form of client leads in exchange for sending customers to the company’s financing arm for mortgages.
The complaint was filed in Washington District Court on Nov. 7, 2025, and alleges that Zillow has violated the Real Estate Settlement Procedures Act (RESPA), the Washington Consumer Protection Act, and aided and abetted the breach of fiduciary duty by real estate agents through its policies.
The primary target of the lawsuit is Zillow’s Premier Agent program and its connection to Zillow Home Loans. Participating agents who pay or earn access to consumer leads through Premier Agent around 2022 also began to be assessed by Zillow by metrics related to its home loans program, the lawsuit alleges, “requiring Participating Agents to meet specific ZHL [Zillow Home Loans] pre-approval quotas as a condition for maintaining access to these high-value leads.”
“Agents who meet ZHL pre-approval quotas receive better leads and placement, while those who fail to do so face reduced volume or removal from the program — a textbook quid pro quo that turns Zillow’s referral network into a mortgage funnel in which Zillow controls the flow of valuable buyer leads,” the complaint continues.
“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.”
Zillow did not immediately respond to Inman’s request for comment.
The lawsuit also alleges that Zillow’s user interface, which includes a pre-checked checkbox for “interest in Zillow Home Loans,” paired with the company’s undisclosed incentives for Premier Agents unwittingly funnels buyers and borrowers into the Zillow Home Loan system.
A homebuyer named Araba Armstrong from Anchorage, Alaska, is serving as the lawsuit’s lead plaintiff.
Armstrong was connected with a Premier Agent in 2024 through the Zillow platform, and under that agent’s guidance, the complaint alleges, was pre-approved and ultimately secured a mortgage loan from Zillow Home Loans. Armstrong, who was a first-time homebuyer, allegedly believed that she was obligated to use Zillow for her mortgage.
The complaint further alleges that Zillow is “wielding its monopoly power to exert enormous pressure on real estate agents, who are supposed to be acting as fiduciaries towards their clients. By doing so, Zillow is fundamentally cheating a carefully regulated system in order to win more of the mortgage financing market, and the result is that homebuyers do not get objective, clear-eyed advice from their trusted real estate agents. Instead, and without their knowledge, buyers are being steered towards ZHL mortgages, not because they are a better product, but because the agents are required to do so by Zillow in order to get the leads needed for their business.”
Lawyers who filed the lawsuit also tied Zillow’s alleged steering to its quest to build a “super app” for real estate that “capture[s] every stage of the home-buying journey on a single platform,” citing investor materials from February 2025.
In September, Zillow was also slapped with a class-action suit over allegedly deceptive Flex agent tactics. That suit claims that Zillow inflated costs to homebuyers through the Zillow Flex referral program, which imposes up to a 40 percent charge to agents who successfully close a transaction after a lead generated through the platform.
That complaint also states that the bright blue button on Zillow listings that says “Contact Agent” deceptively directs buyers to a Flex agent, not the listing agent as consumers would expect.
News of the lawsuit was first reported by Real Estate News.
Zillow is also currently facing lawsuits from CoStar Group over alleged copyright violation, Compass over its new listing access standards and the Federal Trade Commission over its rental syndication agreement with Redfin.
Read Araba Armstrong’s full complaint against Zillow below:
