Tuesday, April 10, 2007

Realespace.com prepares to upset the mortgage lead generation model

Forget the mysterious landing page you encounter at www.realespace.com, or the lofty goals. The most interesting thing about this new Web 2.0 real estate play is that it addresses the mortgage space in a way that others have not attempted to.

In a recent blog post JeffX, the "X Broker" and founder of Realespace.com argues that his proposed solution will return anonymity to the user and give the user access to a wholesale pricing engine. From his blog profile, he intends to build a

"wholesale lender automated Pre-Qualification engine crawler/bot for consumer direct access. Think of Expedia.com, but for correspondent pricing mortgage rate sheets and feeds."


I think he's got half the equation right. Today's internet more than ever is all about the consumer, and is - as David Armano or Joseph Jaffe put it - moreover a conversation with the consumer. The existing model of lead generation needs to evolve, the consumer needs to be given more control and a voice. Allowing for customer anonymous retrieval of consumer pricing information is the right direction.

However, giving consumers access to wholesale pricing information is not the solution.

This will confuse and frustrate the consumer at least, as any such system is inherently tied to the willingness of many commercially interested lenders and brokers to cooperate, introduces a new layer of pricing variables, and does not deliver lockable pricing.

Yet going down the path of lockable pricing online is a path even more perilous that has been lost by greater aspirants (FreddieMac, Microsoft Homeadvisor anyone?).

XBroker is correct in principle, and I believe incorrect in execution. A correct execution is perhaps one that comes directly from the shared wisdom of the consumer, and built off a system that presumes wholesale lenders will co-operate and lenders will understand, and brokers will honor.

3 comments:

sanj said...

Paul-

interesting note on realespace. seems like there a lot of services that aggregate and price wholesale rates. what do you think the right execution play would be? what about a play where a broker website provides wholesale data in summary form and then agrees to a flat rate cost for closing a loan.

Paul said...

Sanj, I'd love to see consumers sharing and communicating real time information about financial products and services better.

Also, why would any substantial wholesale lender ever agree to allow their data to displayed directly to the consumer like this?

leadcritic said...

Paul,
I came across this post as well and agree with you completely. This would be confusing at the least for the consumer and would not be a good move in my opinion.
I agree the consumer needs to have more control over their process and this is being offered to them more and more. There are number of automated pricing engines that are integrated into websites and that will also mash up credit pulling services, AVM's, etc.

I am some what surprised that xbroker doesn't realize this. However it is possible that we do not know the complete picture of what he is trying to do.