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Zillow Mortgage Marketplace – The future of mortgage leads?

Wednesday, April 9th, 2008 | Link | Spread The Word!

For those who missed it, the outrageously well-funded online real-estate “start-up” Zillow opened the doors on its Mortgage Marketplace this week.

It’s a very interesting model and one that has the potential to cause a mini-revolution in the mortgage lead industry. Why? Primarily because they are handing out free leads to almost anyone who wants them. This is how it works:

For the lender:

  • The lender signs up and pays a $25 sign-on fee
  • Zillow verifies that the lender is bonafide
  • The lender is ready to start receiving “free” leads


For the buyer:

  • Complete an online form
  • Start receiving quotes from lenders by email


So why is this revolutionary, apart from being free? First off, the consumer is anonymous. This means the lender is quoting purely based on the accuracy of the information the buyer submits which for many brokers is going to be a fruitless exercise – how many times does a consumer inaccurately quote their credit score? Anonymity does have the advantage that the buyer cannot be inundated with calls. Conveniently for Zillow, the only way for a broker to contact them is through, uh… Zillow. Secondly, the lead is available to a huge number of lenders (over 1,000) which will inevitably drive high levels of competition. Finally, just like with eBay, the consumer gets to rate the buyer and every other potential customer can then see that broker’s rating.

So will Zillow Mortgage Marketplace be successful? I think moderately so. After all, after just 3 days, Zillow already has over 1,000 brokers registered and has generated 7,894 leads. However, I definitely do not think that the model will replace the current online lead generation model. Zillow will be good for consumers; it will drive super-low quotes. Unfortunately, this model probably favors a broker without much of a real-world reputation. Someone who is prepared to bait and switch an aggressive quote for a realistic quote and that can take a hit on their reputation if the scorned consumer gives them a bad rating. But we shall see. This type of innovation has transformed the travel and hotel industries among many others. No doubt a segment of the market will also be attracted to this model in the mortgage space.

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What They're Thinkin'

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  1. I’ve put in over 1200 quotes on Zillow and have 3 in process since the beginning of April. However, the site is a great way to recruit Loan Officers. I got two of them. So I guess 3 loans and two LO’s not too bad.

  2. Mortgage Online Quote Uk…

    Where can I find more sites like this?…

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    There has been change brewing at the first online lead exchange and it has little to do with their website. Rumors have it that there are a couple of key team members leaving the company.
    Steve Horton, VP and General Manager  has been rumored to have …

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