New Techniques - Generate Leads in Tough Times

By Brad Finkelstein, Origination News, February 2009


Among the hottest ways for mortgage originators to connect with potential clients is Zillow Mortgage Marketplace. Spencer Rascoff, its chief operating officer, said the system allows consumers to get an unlimited number of quotes back from the originator.

At the same time, the consumer remains anonymous to the quote provider until the consumer elects to make contact. There are some 4,000 originators who participate in the Zillow Mortgage Marketplace.

When the service first started, for the first six months, mortgage originators had to provide those quotes to consumers by making their calculations by hand.

While there are now several automated interfaces originators can use, among the first arrangements was one created with LoanSifter, a pricing and pre-approval engine operating out of Little Chute, Wis. The service has information from both correspondent lenders and wholesale lenders, covering some 120 investors.

Craig Doriot, chief technology officer of LoanSifter, said it prices the leads very accurately and it is seamless, so the customer doesn’t know the lead is auto-generated.

The consumer gets feedback immediately, LoanSifter president Bruce Backer said. “The loan officer doesn’t even see it. It just comes into LoanSifter, it gets quoted and pushed right back to Zillow and it gets presented as being from the loan officer.” The loan officer is immediately able to work on the lead, but no longer has to do the legwork to prepare the quote.

Mr. Backer said one LoanSifter client was on Zillow for several months, quoted 2,500 leads, hand-quoted them all and got seven new loans. The client was happy and would have continued using Zillow without LoanSifter, he added, because he got seven loans he wouldn’t have had.

But by using the automated service, the client is able increase productivity and can respond to more Zillow-generated requests. More importantly, they can issue quotes from all of their investors. Even just doing quotes from a small number of investors by hand can be difficult and might not even be the most competitive.

“Zillow has done a really nice job in being able to make it really consumer-friendly. They have given the loan officer a way to describe himself or herself and describe what differentiates them. It is using those types of tools that we find help the loan officer be effective with Zillow,” said Mr. Backer.

Mr. Doriot told the story of one loan officer who said his goal was to be one of the first in front of the customer (consumers are more likely to respond to the quotes they receive quickest). That LO said it is difficult to be first if calculations have to be made by hand.

Zillow added that by using the automated products, it eliminates the possibility of error in making the calculation.

Mr. Rascoff said approximately 60% of the quotes that are returned to consumers are created through engines like LoanSifter. Other partners included Mortech and Leads 360.

Zillow has done lots of consumer research around the product and he said that users love the anonymity the service provides. “Our research tells us they hate the old lead generation model where their name and contact information is offered up for sale to the highest bidder,” he said.

The company also created the system to counteract bait and switch. And there is an e-Bay style feedback system that allows consumers to comment.

Among things that can be tracked on the Zillow website are loan quotes per loan request. On the day the interview was conducted, that number was 8.5. Mr. Rascoff added that just a few months ago, the number of quotes was approximately half of that.

“We’ve completely reinvented the traditional lead generation model by empowering the consumer and the lender and turning lead generation on its head,” he declared.