Compass Relaunches Concierge Loan Program
Compass is relaunching two loan programs – with new limits to minimize risk.
The residential brokerage announced it would restore Concierge, which gives money back to homeowners for home repairs, to second home markets on June 15. Compass plans to restart part of its bridging loan service, which advances money to borrowers, on July 15.
Over the past two years, both programs have generated Compass agent listings as the SoftBank-backed company increases its market share nationwide.
In March, Compass scaled down programs at the request of lending partners, which responded to the economic uncertainty around Covid-19.
In the case of Concierge, Compass limited spending to $30,000 for homes under $3 million and suspended the program in some second home markets. He stopped moving bridging loan Payments. Compass’s bridge loan program advances payments through Notable, an independent lender.
A Compass spokesperson said Concierge will resume in phases. Phase I includes the Hamptons, Santa Barbara, Montecito, Carmel by the Sea, Napa, Naples and Cape Cod.
It also adds safeguards to Concierge to limit its exposure. Previously, rivals had slammed the program, saying it was risky if the listing didn’t sell.
Going forward, agents will be suspended from using the program if they have two or more clients who have used Concierge and have not listed or refunded funds in a timely manner.
With these measures in place, Compass aims to revive a program that has helped agents earn listings. In 2019, the company said 5,000 agents used Concierge across 11,000 listings valued at $8.5 billion. This represents 17.5% of Compass ads.
On average, Compass said agents using Concierge increased their ad count by 47% in 90 days. This allowed Compass to more than double its enrollment volume year over year. In 2019, Compass sold $88 billion in real estate, up from $45.5 billion in 2018.
Since 2012, Compass has raised $1.5 billion from investors at a valuation of $6.4 billion. At the end of 2019, it had 15,500 agents nationwide.
Like other businesses, Compass has been hit hard by the pandemic, which has shut down in-person screenings and other brokerage services. End of March, Compass fired 15% of its staff, or approximately 375 people, after modeling 50% drop in revenue over a period of six months.
Last month, CEO Robert Reffkin expressed his optimism about the market. During an appearance on CNBC, he said Compass’s year-to-date revenue has grown 47% and the company “is seeing an accelerated transition from traditional businesses to technology-driven businesses. “.