Motto Mortgage will remain brokerage franchisor under Real

Motto Mortgage will retain its current business model of a mortgage brokerage franchisor following completion of parent company Remax Holdings purchase by Real.

The transaction will also not affect the operations of Wemlo, the mortgage processing business owned by Remax nor that of One Real Mortgage, the mortgage brokerage owned by Real.

"Additionally, through One Real Title, One Real Mortgage, Motto Mortgage and Wemlo, we will bring more integrated ancillary services under one roof," said Tamir Poleg, Real's chairman and CEO during a conference call on the transaction. "That matters because it gives agents and their clients more control over each transaction with fewer hands-off, faster closings and a better experience end-to-end." 

A change at the top for Motto and Wemlo

During the past year, Motto Mortgage and Wemlo, which are separate business lines, had a change at the top, as Ward Morrison retired and Vic Lombardo became president of mortgage services at Remax. Remax Holdings acquired Wemlo in September 2020.

However, the number of open Motto Mortgage offices fell 24% during 2025 to 171 from 225 at the end of the prior year. An operator does not have to own a Remax franchise in order to have a Motto business.

Motto's primary source of revenue is franchise fees.

Why Real did this deal

"Two distinct models, one platform, each made stronger by the other," Poleg said about the combination overall. "Put simply, the combined platform gives agents and franchisees more reasons to join and more reasons to stay."

Under the terms of the agreement, each Remax share is valued at $13.80, based on Real's April 24 closing prices. Each Remax shareholder can receive 5.15 of the Real Remax Group's common stock or $13.80 cash. Real stockholders will get one share of Real Remax Group for each share they own.

This means the ownership of the combination will be 59% Real shareholders and 41% Remax.

The deal is expected to close in the second half of the year. Remax Chairman and co-founder Dave Liniger controls 38% of Remax's voting power and will cast those in favor of the deal.

A strategic advantage in a consolidating industry

BTIG sees the deal as a competitive win as Real gains scale and relevance in a consolidating real estate industry (for example, Compass' buy of Anywhere) at the bottom of the cycle, said Jake Fuller, an analyst in a research note.

"The deal will diversify revenue, add a high-margin franchise business and expand the product offering," Fuller added. Finally, "Real is acquiring Remax at what we see as an attractive multiple and it should be able to work down the leverage quickly even without an underlying housing rebound." 

How the combination will make money

On a pro forma basis, mortgage and title would have made up 2% of the combination's gross profit. By itself, Real's 2025 gross profit was 95% commission and 5% mortgages.

For Remax, 52% continuing franchise fees, 14% annual dues, 24% commissions and 10% franchise sales and other.

Besides the contribution from mortgage and title, the remaining gross profit composition on a pro forma basis was 55% commission, 29% continuing franchise fees, 8% annual dues, plus 6% franchise sales and other.

"We also believe there is a compelling revenue growth opportunity from leveraging the combined platform, not just from stronger agent and franchisee growth, but across our higher-margin mortgage, title and Real Wallet businesses," said Ravi Jani, Real's chief financial officer.

In the presentation, Jani pointed to the slide with potential revenue opportunities from the combined companies.

Under "mortgage expansion," it said the deal provides Remax clients access to in-house financing options, which will deepen the consumer relationship. Plus, it captures mortgage economics which flows to third parties.

Offering in-house settlement and title services to Remax's franchisee network will convert an outsourced process into a captive, high-margin revenue stream, Real continued.