Inside the White House with D.C.'s most wired reporter. Sign up for Mike Allen's Axios AM.

Stories

Zillow gets into mortgage lending

Tablets and phones that show the Zillow app.
Photo: Zillow

Zillow has agreed to buy Mortgage Lenders of America, a national mortgage lender based in Overland Park, Kansas.

Why it matters: Zillow CEO Spencer Rascoff tells Axios that MLA isn't large enough "to satisfy our long-term ambitions." In other words, expect Zillow to buy up other home mortgage lenders.

Market reaction: Not good. Zillow stock was down 17% at the open, although Rascoff believes investor angst is more about missed guidance than the acquisition.

The bottom line: Home mortgages are a lower-growth business than what many investors are used to from a tech company, but Zillow believes its relatively new (and expanding) home-buying/selling efforts must be full-service — much like how many home-builders have in-house mortgage lending groups.