OneStop Advantage: Bundling Its Way Out of the Downturn

A company combines wholly owned affiliates with the aim of lowering the cost of transactions.

August 1, 2008

When Richard (Dick) Sinapi launched OneStop Advantage in Cranston, R.I., last May, he was betting he could get consumers off the homebuying fence if he offered them the convenience of brokerage, mortgage, and title services under one roof and made the services available at a discount.

Now, after a year of operations, he thinks his assumptions are proving correct. By June 2008, his brokerage had almost $5 million in homes listed (at a $245,000 median price) and had sold $2 million in the first five months of the year. He was finalizing paperwork to expand operations to neighboring Massachusetts and Connecticut.

What’s more, his company had grown from one to eight sales associates and from one to six loan originators.

“Agents and originators are leaving the real estate and mortgage finance industries here,” says Sinapi, a real estate attorney who started in the industry as a builder. “We’re attracting some of them because our model is attracting business.”

The company’s pricing plan is based on volume discounting. Consumers who list their house with the brokerage and use its mortgage affiliate to purchase their move-up residence are offered a commission that’s below the company’s typical rate. Those customers also get a break on their financing through a reduced origination fee and a more favorable interest rate. The interest-rate discount is between 0.5 and 1 percentage point off of the going market interest rate.

OneStop offers an additional price break if the client uses its in-house settlement company to handle the closing. In all, consumers taking the entire package — listing, selling, financing, and closing — save between $6,000 and $8,000 on average, the company claims.

About 80 percent of its listing clients opt for the complete package, Sinapi says.

“It’s the odd one that comes in that already has a lender he works with,” he says.

To attract buyers, the company offers a $1,000 rebate from its portion of the selling commission.

In its main point of differentiation from other small brokerages offering bundled services, the company’s three affiliates are wholly owned entities of a single parent company, OneStop Advantage. More typical is the joint venture model, Sinapi says, in which the brokerage enters into partnerships with a mortgage broker and a title company to offer all the services under one roof.

The problem with that arrangement, Sinapi believes, is the revenue model. To make the partnerships profitable, he says, brokers try to maximize revenue at each of the service levels, resulting in lower capture rates for each because the pricing isn’t as competitive.

In Sinapi’s wholly owned model, he discounts his pricing on each of the services to get to that 80 percent capture rate.

“We maximize gross revenue from the transaction by keeping all of the core services within the affiliation,” he says.

By this time next year, Sinapi plans to add a wholly owned insurance company to the mix to offer casualty, disability, homeowners, mortgage, and property coverage.

The company is careful to disclose the affiliation of its service providers up front, as required under the federal Real Estate Settlement Procedures Act, and encourages consumers to shop around with other service providers before deciding whether to go with the package deal. “We just ask that we be given the chance to meet or beat the competition on pricing,” he says.

His sales associates are compensated on a traditional commission split basis and are offered no incentives for recommending the packaged services, other than the convenience it offers their clients. There’s also less chance the transaction will fall apart prior to closing because of the ability of the different services to work together, he says.

“We compete by saying we provide quality, professional services at a significant discount in a highly efficient fashion,” he says. “To an informed consumer, this is an easy choice.”

For more on OneStop Advantage, visit

Robert Freedman

Robert Freedman is the former director of multimedia communications at NAR.