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Guaranteed Rate and Realogy Join Forces for a Winning Mortgage Experience

Editor’s Note: This is the cover story in the February issue of RISMedia’s Real Estate magazine.

GRA_Full_Cover_March18_300x420This story has it all. Rags to riches. Disruptors vs. the establishment. Partnership and growth. It has a likeable cast of stars with off-the-charts charisma, and a plot line filled with impossible-to-believe karma.

It is a story that brought Guaranteed Rate Affinity Chairman and Guaranteed Rate, Inc. President & CEO Victor Ciardelli and his team to Realogy’s headquarters in Madison, N.J., in late 2016, on the verge of another of their milestone moments in the mortgage industry.

“The story is crazy but it feels really good to be back home,” Ciardelli says with a huge smile. “It’s where I belong.”

Realogy, the Fortune 500 residential real estate leader whose company-owned brokerages and franchise networks account for approximately a 17-percent share of industry commissions, was looking for a new mortgage partner after PHH had indicated it would be exiting the business.

“We flew in from Chicago and sat down with the Realogy team,” says Guaranteed Rate Chief Revenue and Strategy Officer John Elias. “They were on one side. We were on the other. Victor sat across from (then Realogy CEO) Richard Smith. Before we started our pitch, Victor had something to say. He thanked Richard for giving him his start. We were in sync immediately.”

Guaranteed Rate Affinity: The Origin Story

It has been almost a year since Realogy announced its agreement with Guaranteed Rate to create a mortgage joint venture. The new entity, Guaranteed Rate Affinity, now directly serves the more than 50,000 NRT agents and their clients, along with providing home loan options for transferring employees of Cartus clients, Realogy’s relocation subsidiary. Looking ahead, the joint venture ultimately intends to expand and develop relationships with the thousands of independently owned and operated real estate brokerage firms affiliated with Realogy’s franchise brands: Better Homes and Gardens® Real Estate, CENTURY 21®, Coldwell Banker®, ERA® and Sotheby’s International Realty®.

Ciardelli takes immense pride in how his early career, which had deep Coldwell Banker roots, eventually turned into a 20-person, hyper-local Chicago firm. From those humble origins, Guaranteed Rate has since grown into the eighth-largest mortgage origination firm in the nation, funding nearly $23 billion in home loans last year alone, according to Inside Mortgage Finance.

His upbeat, gregarious personality is contagious. His constant quest to put agents first and do things “the right way” has manifested itself in a highly attractive company culture that has brought him full circle on an irony-filled road that began more than 25 years ago.

Victor_Ciardelli_Quote_1Ciardelli, now 51, started his first mortgage firm, Guaranteed Financial Mortgage, in 1992 and built a working relationship with Sergio Martinucci and his Coldwell Banker Stanmeyer managers in Chicago. The young mortgage guy hustled, worked hard and eventually earned an exclusive deal to service all 10 of the franchised company’s offices.

“It was my own small company, and I didn’t have the best platform for the agents,” he says. “But I learned about how agents thought, how they did things, their stress points and what they needed to improve their businesses. I had good ideas, but my value proposition wasn’t better than my competitors. It seemed like my foundation had been built on mud. I just never felt I had traction.”

While successful, Ciardelli’s uphill climb came to an abrupt end in 1999 when Martinucci called him into his office.

“Sergio told me that he had just sold his company to Coldwell Banker’s corporate parent, and that Cendant Mortgage would now have the exclusive mortgage rights in his offices. I was out.

“Looking back, it is incredible,” he continues. “I started doing business with Coldwell Banker, which grew to be a huge part of my business, then had to exit because of their company-owned operations, which is now NRT. Now I’m back and integrated with both Realogy and NRT. The weird thing is that I always had this law of attraction thing in my head. I always had this idea that this group would eventually be my home again. I always believed it.”

Always Put the Customer First

A lot happened during the 18 years between breakup and reuniting, including Ciardelli’s frustration with the wildly inconsistent mortgage sales industry that allowed different rates and fees for different customers.

“Back then, loan officers and mortgage companies were playing games with customers,” says Ciardelli. “If they got the sense that the client was not sophisticated, the client got a higher rate. Savvier clients got lower rates. It was wrong, and because I had learned so much from the agents, I felt that if we could start a mortgage company devoted to the agent, be more transparent to them and their clients, and go out with lower margins and one fixed fee in place, we would succeed.”

At this point, Ciardelli jumps from his conference room chair and bounds out through an open door—an open-door policy in the headquarters is a constant reminder about transparency—to get John Johnson to help tell the rest of the story of Guaranteed Rate’s beginnings.

“J.J. and David Fisher were my first two loan officers and they are both still with me today,” he says. “I started with 20 employees and didn’t bring over many from my first company because I needed people who were open to doing things differently.”

Don_Walt_Quote_2Ciardelli founded Guaranteed Rate in 2000 and set up shop in the same three-story brick building (four if you count today’s incredible roof-top set up), nestled in the Ravenswood residential area five miles from downtown Chicago and just feet away from the Brown line train stop that has a Guaranteed Rate ad painted on the Irving Park Road overpass.

The company focused on the 20 percent of the Chicago real estate agents who did 80 percent of the city’s business.

“We were all about the agents from the start,” Ciardelli says. “They were tired of seeing their clients taken advantage of. They knew it reflected badly on them. The process was broken. We knew we could help the agents grow their business and help them get more signs in the ground with us as a resource. The mortgage process shouldn’t be a roadblock. It should be clean, painless and transparent.”

“Through Victor’s contacts in the city, we started by having one-on-one meetings with top real estate agents and they got it,” says Johnson. “They were excited about our approach and soon we started meeting with two or three agents at a time. There was a multiplier effect. It snowballed. They saw we weren’t greedy and we wanted them to grow with us. We had the caring part down and they believed in us; we also had to have the proper pricing to compete.”

That realization led to a secret shopper staff that called all of the city’s big banks every single day to get their daily rates, which they posted on their website.

“The big banks hated us,” says Ciardelli. “We made the industry transparent and totally destroyed the games they played. They would call us and complain and said that those rates were negotiable—which was exactly the point we were making. We beat their rates and brought margins down.”

The approach worked. Guaranteed Rate became Chicago’s top lender within three years.

“Our agent-focused model is based on low rates, transparency with no hidden fees, thoughtful mortgage products and low risk,” says Chief Investment Officer Ted Ahern.

National growth followed, complete with TV advertising starring Ty Pennington and a multi-year, multi-million dollar deal in 2016 to rename the Chicago White Sox stadium as Guaranteed Rate Field. An 80-person marketing team works closely with loan officers on an infinite number of local agent events that have helped the company establish itself as a mortgage industry leader with more loan originators on the Scotsman Guide and Mortgage Executive lists than any other firm.

Today, these loan officers are powered by a digital loan program pioneered in 2015, another industry first.

Pre-approvals are done 24/7 and usually completed in 24 hours or less. When a client is ready, Guaranteed Rate’s Digital Mortgage takes just 12 minutes to complete. And those who are prepared with the list of required documents can upload them into the secure “Transfer Safe” and move to the underwriting and loan approval stages in about 25 minutes. The company has a stated goal to get a client to closing in 10 days when appropriate.

Work With the Best of the Best

Its clear momentum and technological advances earned Guaranteed Rate an invitation to the Realogy dance, but it was the company’s focus on the agent that fueled the partnership and creation of Guaranteed Rate Affinity, which has a 50.1 percent vs. 49.9 percent ownership stake between Guaranteed Rate and Realogy, respectively.

Group_Photo_3“We were impressed right away with their understanding of what brokers, managers and agents need—along with the consumer,” says Don Casey, the CEO of Title Resource Group (TRG), the Realogy-owned leader in title and settlement services who also led Realogy’s mortgage-partner efforts. “Victor and his team are well versed in RESPA compliance and understood that Realogy highly values ethics and integrity. We loved their philosophy to market locally with a heavy emphasis on agent education and interaction. It became a very natural fit.”

Casey adds: “Our Goal with Guaranteed Rate Affinity in 2018 is to greatly improve our mortgage capture rate by offering better products and dedicated service to NRT agents, transferring employees and members of Cartus’ relocation and affinity clients and, ultimately, all agents affiliated with Realogy’s franchise brands.”

Casey, along with TRG’s Chief Strategy Officer Walt Mullen, joined forces with Ciardelli, Ahern, Elias, Guaranteed Rate’s Chief Operating Officer Nikolaos Athanasiou and Guaranteed Rate Affinity Managing Director Ralph Melbourne, to lead a team that created the entirely new Guaranteed Rate Affinity structure from scratch in several short months.

The effort included contracting with credit, fraud protection and hundreds of other vendors, learning about office set-ups and leases in NRT locations, licensing and processing staff in all 50 states and getting investment agreements with the likes of Freddie Mac, Fannie Mae, HUD and the VA.

Guaranteed Rate Affinity also went on a recruiting and retention tear since its founding in February 2017, on-boarding over 900 former PHH Home Loans employees, including 365 loan officers who were already established in many NRT offices.

“We essentially took over the PHH Home Loans operation and had to provide everyone with an entirely new structure and system,” Casey explains. “There were differences in the marketing, policy, procedures and process. It was an exhaustive effort, yet we retained 90 percent of the previous staff. This continuity was important because of the existing office relationships with sales agents.”

These loan officers, now VPs, saw immediate benefits because of the mortgage products they could provide.

“Guaranteed Rate Affinity has the best value proposition in the industry, hands down,” says Melbourne. “I just got off the phone with one of our VPs who told me that he already had great relationships with the agents in his office, but with the products, pricing and process at Guaranteed Rate Affinity, he now gets a shot at almost every deal. He’s in an urban center where condos can create complex loan challenges, but that’s not a problem anymore. Regardless of the situation, we have a product to fit just about every need—jumbo, conventional, ARMs, 3 percent down, non-warrantable condo, government, builder, disaster relief, doctor loans—you name it and we probably have it.”

Guaranteed Rate Affinity intends to significantly grow its VP ranks in 2018 to increase its service capacity for NRT’s national office footprint in more than 50 of the nation’s 100 largest metropolitan markets.

“We are looking at best-in-class loan officers who have the desire to work closely with a team that is transparent to the agent and customer,” says Elias. “Our brand presence and process is tremendous. They will be co-located in some of the most successful real estate offices in the nation. And, most importantly, we are freeing them up to work more closely with agents than ever before.”

Since opening its first operations in Midwest locations in August, Guaranteed Rate Affinity is already funding $15 to $20 million in mortgages per day, about equal to where Guaranteed Rate was in 2009.

“We have yet to see the full power of Guaranteed Rate Affinity, simply because we spent the second half of 2017 ramping up with them,” says Ryan Gorman, president and CEO, NRT. “Our agents are going to see that they are the real deal and the best mortgage partners in the business. We know in our bones how good they are. They will be able to provide great value to the agents and their clients.

“The agents should take comfort in the fact that our entire company is behind this partnership. If problems arise, the loan officer will be right there and, if needed, we have direct access to the right people, including Victor who is personally invested in our success. He knows this is a long-game play and from the absolute beginning we saw his uncompromising approach to serving the agents best.”

TRG’s Mullen, who noted that Realogy and its former parent company have been in or partnered with the mortgage business for approximately 20 years, sees a viable tech-driven future.

“Serving agents is at the heart of what we do, and through Guaranteed Rate Affinity we will be able to augment the agents’ efforts and also meet consumer demand for an ease-of-use mortgage experience throughout the home-buying process,” he explains. “We are clearly headed toward becoming the first national company with an online platform that allows consumers to search for homes, get a mortgage and close everything online. It’s exciting.”

Realogy, with its “We Serve Agents” mantra, has clearly found a strategic mortgage partner who believes fully in that same approach.

“It’s amazing how our agent-first philosophy continues to resonate so loudly today,” says Elias. “We stress the importance of never underestimating the role of the agent in the process. They are the link to the customer for mortgage, inspectors, title, attorneys and for so much else. I’ve heard other lenders badmouth agents. Not with us. Their job is much, much harder than ours.”

Just then Ciardelli caught Elias’ eye and went all smiles again. “All of this is all because of our dedication to the agent. And it is just so amazing that we got here. We’re definitely back home again.”

Guaranteed Rate Affinity’s Value Proposition for Agents

  • Dedicated to providing the best mortgage experience possible
  • Agent-focused model with fantastic customer service
  • Incredibly low rates for customers
  • Transparency with no hidden fees
  • Wide selection of mortgage products
  • Fast, simple process with world’s first Digital Mortgage
  • Great communication at every step in the process

For more information, please visit

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