There’s always something to howl about.

Category: Zillow.com (page 4 of 13)

Zillow Mortgage Bourse: How To Acquire Long-Term Clients

I might have been hasty in my original assessment of the Zillow Mortgage Bourse. I sometimes suffer from TB; true believer disease. I’m one of the few guys in the mortgage business that actually wants to see the cost of loan acquisition, for the consumer, dramatically reduced. I have never seen my role as a middle-man. I see myself as part financial adviser and part trader.

Permit me a digression:

I have always considered yield spread premium to be the borrower’s money. I have aggressively used it in serial no-cost refinances, throughout the late 90’s and early part of this decade. Critics, don’t bring up the issue of churning. I assure you that every transaction I funded has a tangible net benefit to the borrower.

When a borrower gets “into my web”, by closing a loan transaction, I conduct periodic mortgage reviews. Jillayne Schlicke once commented that the periodic review is just an excuse to “sell a refinance”. My response is a bawld one: “Well, Duh!“. We should ALWAYS be looking for an excuse to refinance the borrower’s loan…IF…there is a tangible net benefit to the borrower AND I get paid. Call that the way of the trader. Traders look for opportunities to profit off market fluctuations.

I digressed but I wanted to give you some background. My initial concerns about The Zillow Mortgage Bourse were two-fold:

1- Customers don’t know what they don’t know. I pontificated that the customers would be EXTREMELY difficult, focusing on price rather than suitability. I found the data byte, on the loan request form that distinguishes the client’s intent. This is the real Web 2.0 offering of the Zillow Mortgage Bourse.

2- I felt that consumers could game the system, waste originators’ time, and damage our reputations if they didn’t get exactly what they wanted when they wanted it. I also thought they would “steal” the advice we offer, and engage in a perpetual RFP process until they found the lowest price. That happened often in securities brokerage Read more

Zillow Mortgage: I’m Still Looking for the Yellow Brick Road

There sure have been a lot of posts recently regarding Zillow Mortgage Marketplace.  Greg Swann gave us a pre-opening preview here, the advertising aspect here, and the capitalist and cookie aspects here and here.  Brian Brady takes a “the last shall be first” attitude here and presents Zillow Mortgage as online dating here (this is the Great and Powerful Oz so, trust me, he ties it together).  I have been following this closely and am, in fact, one of the “approved” lenders on Zillow (I still pay many of the bills originating).  But, in my search for the Emerald City of Transparency, I am still looking for the yellow brick road.

Before commenting on transparency and the great Zillow experiment, let’s quickly dispense with the true purpose of Zillow Mortgage; it was made clear two days ago by Greg Swann when he wrote:

What this means is that Zillow will be able to deliver highly-targeted advertising to its users, zeroing in on products and services that would be most appealing to that user’s sex, age, income and other demographic characteristics. This by itself will make Zillow extremely profitable to advertisers, who seek assurance that their promotional efforts are aimed at the right prospects.

Despite the conclusion one reaches when we “follow the money”, there is still an important tool being implemented here and I hoped it would be a step down the yellow brick road, but it is instead only a blueprint.   I am talking about the consumer’s ability to rank the originator.  The most common comparison made is to Ebay, but here is the problem with that comparison.  Ebay works because both parties have a horse in the race.  They are both interested in performing some transaction and can be judged for their behavior.  Not so with Zillow Mortgage.  The originator has an interest, she, in fact, has a couple of interests: creating business, protecting reputation, creating a raving fan for future referrals and even, possibly, the noble interest of helping others.  How much of that can be said for the potential borrower?  If these leads are anything like the standard internet lead, you are Read more

Zillow Mortgage Marketplace: One Way Transparency Like A Bad Online Dating Site

Zillow Mortgage MarketPlace rang the opening bell and loan requests came flying in the door. I was pleasantly flabbergasted! It’s no secret that I’m a Zillow-phile; I believe they are leading the way to transparent loan and real estate transactions.

I’m tenuous, however, about spending too much time there. My comments at BusinessWeek:

Brian Brady, managing director at San Diego’s World Wide Credit, a national lender and broker, said he signed up for the Zillow mortgage marketplace a few weeks ago and has mixed feelings about it.

Advice Needed?

He said it has the potential to be a great tool for both consumers and lenders. But he’s concerned that borrowers will be seeking quotes without first getting advice from mortgage professionals about the loan that best fits their needs.

He’s also concerned about the kinds of leads the site might generate.

“Zillow is going in the right direction, in that the consumer gets to rate us as [loan] originators,” Brady said. “I certainly wish it were a mutual rating system because customers need to be rated, too.”

Take a second look at my final comment. Consumers should be rated, too. The challenge for quality originators, today, is time. With so many loan applications that are unable to be funded, we have to be judicious about where we spend our time. My concern is that I’m shooting craps with loaded dice when I engage in anonymous quoting; I have little upside. If I deliver a great quote, I am rewarded with an opportunity to “sell” a new customer. If the customer is disingenuous about her information, I am accused of delivering a “phony quote” and am rated poorly, within the community.

Wade Young expands upon my concern on Lenderama:

When I pull the actual credit, I’m not going to be able to make good on what the Zillow consumer will most definitely consider to be a “promise” made by me via my rate quote. The lady gives me one star (undeservedly, of course), and I move on to other things.

Wade is more concerned about the Read more

Black Pearl Marketing Minute: Want to learn how Zillow.com bakes a sweeter, tastier browser cookie? Scratch the FUD from your recipe

I wanted to expand on my post from last night on Zillow.com’s use of web browser cookies with its new Mortgage Marketplace free loan quotes software.

So you know going in, I have a huge contempt for people who try to sow FUD — fear, uncertainty and doubt — about new technology. In the podcast linked below, I’ll give you the grand tour of the browser cookie bakery:

  • What cookies really are
  • Their implications for privacy and secrecy
  • How Zillow is implementing browser cookies
  • And, most importantly, how you can deploy browser cookies in your own marketing

If you insist upon living in a demon-haunted world, you’re probably not going to get much out of this. But if you understand that, as a side-effect, Zillow is teaching you a great deal about hi-tech marketing, then put on your thinking cap and think.

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Heard on Broad Street: “Zillow.com may in fact be reinventing — and perfecting — Capitalism”

Back in the 19th century, when the stodgy New York Stock Exchange was already ensconced in the lap of luxury, the traders who would one day form the American Stock Exchange were stuck out in the rain.

Literally. Stock brokerages that couldn’t afford a seat on the NYSE instead rented offices on either side of Broad Street near Exchange Place. Clerks hanging out of windows would communicate bid and ask prices by hand signals to the traders working outside on Broad Street. Rain, sleet or snow, the traders effected their exchanges.

Last Summer I poked fun at Zillow.com’s CEO Rich Barton for a vision he had of a 19th century marketplace. This is Barton’s quote:

“I see an old-style marketplace formed, a city market like Pike Place Market. I actually dug up an old photo — Pike Place Market at the turn of the last century. People were gesticulating. People were buying things. People were gossiping. Negotiations were happening. Big billboards were advertising things above the marketplace. That’s the picture I have in my head.”

Give the man his due. I’m thinking Zillow’s Mortgage Marketplace is more like Broad Street than the Pike Place Market, but it definitely is a true bourse — the maximum flow of information between buyers and sellers with the minimum of friction — or even overhead!

I wrote last month that Zillow.com is leading us toward the realization of Capitalism’s promise. Everything we claim as a defect of Capitalism is in fact the confluence of two other systemic defects:

First, a small few people want to behave badly, which fact permits other sleazy people to malign honest traders who are themselves innocent of all wrong-doing.

And second, physical impediments to the flow of information prevent the overwhelming majority of overwhelmingly honest people from distinguishing the innocents from the crooks.

Software systems like Ebay and Zillow’s Mortgage Marketplace mitigate the second defect, leaving the bad actors fewer and fewer places to hide.

The Mortgage Marketplace is a small thing, so far, and, as with everything in the RE.net world, it looks much larger to us than it really is. But consumers — and lenders! — have Read more

Zillow.com takes advertising demographics to never-before-seen places

The other bit of news to come out of Zillow.com is this: The real estate start-up is collecting, deploying and reselling advertising demographics in unique and interesting ways.

The vast quantities of demographic information — income, property values, credit scores — that will be collected in the new Mortgage Marketplace software will be stored in browser “cookies” on the user’s own computer. In other words, Zillow will not be storing this information in its own databases, but will retain control over it by means of software that will be able to access the cookies in future sessions on Zillow.com.

What this means is that Zillow will be able to deliver highly-targeted advertising to its users, zeroing in on products and services that would be most appealing to that user’s sex, age, income and other demographic characteristics.

This by itself will make Zillow extremely profitable to advertisers, who seek assurance that their promotional efforts are aimed at the right prospects.

But Zillow is also making these cookies available to other advertising vendors, such as Google’s Adwords system. By this means, other advertisers will be able to deploy the demographic information Zillow is collecting to target their own ads.

Obviously, the reselling of this demographic information is also a profit-center for Zillow.com — reports of whose financial demise may turn out to have been premature.

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Zillow.com’s long-awaited mortgage lending service offers anonymous customized loan quotes to consumers, affording loan originators the opportunity to compete transparently for free mortgage leads

Seattle-based real estate start-up Zillow.com tonight releases its long-anticipated mortgage lending product. We’ve known for nearly a month that Zillow’s offering would include working loan originators in some fashion. What becomes clear tonight is that Zillow will basically be acting as a hands-off intermediary between mortgage-seeking clients and loan originators.

Consumers using Zillow’s new Mortgage Marketplace will be able to anonymously solicit bids for loans from participating lenders. The consumer will fill out a detailed form disclosing all pertinent financial details.

The form will be submitted anonymously to participating lenders, who will, in their turn, produce quasi-pro-forma loan quotes, submitting them, through Zillow, to the consumer. The consumer will then have the choice to make direct contact with particular lenders to decide whom to do business with.

To a very large degree, the information asymmetry between lender and borrower is done away with, since the loan quote will detail every fee associated with the loan. Moreover, Zillow will be implementing a reputation-management system whereby borrowers will be able to rate their lenders on their performance.

In return, the lenders will receive Zillow’s mortgage leads at no cost.

The new service is expected to come on-line at 9 pm PST tonight. I made screenshots in the product demo teleconference I attended today, but my expectation is that these will be obviated very shortly.

 
Elsewhere: Todd Carpenter, Rich Barton, John Cook, Drew Meyers, TechCrunch, Rhonda Porter, Spencer Rascoff, Joel Burslem, Kevin Boer, Jay Thompson, Rhonda Porter (again), Pat Kitano, Morgan Brown, Trace Richardson.

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NAR Will Channel Data

I’m thirsty, but not drinking the Kool-aid just yet 

The NAR project formally known as the Gateway, a mash-up of all real estate data in the country, has now been relabeled The Real Estate Channel (TREC).  There has been a new “interim” report issued by the Presidential Advisory Group (PAG), but still there is very little detailed information about NAR’s plan.

The new report makes it clear that the intent of TREC is NOT to be a national MLS or have a public access point (other than REALTORS®).  These two clarifications will ease the fears of many local MLS systems and REALTORS® who were worried about the Gateway project.  For others, the idea of a national MLS is appealing and they are still thinking that eventually TREC will become a national MLS, but they are keeping quiet about the prospect for now.

Not making the data publicly accessible is a similar situation.  If you are against public access to data (read: still haven’t made the shift to reality), you will feel good about the new clarification.  If you don’t worry about your clients having access to data, you will be happy with the report because you know that eventually such a massive mash-up will become available to the public. 

So, what the current report says is that NAR will set aside the controversial aspects of the project for now.  This seems like a good compromise to keep things moving forward although is does not feel particularly honest.  So I find myself struggling between integrity and progress – between trust and fear – between belief and skepticism.  Someone referred to the issue in terms of the Wizard of Oz – is there really anything behind the curtain?

The difficulty with this issue is that NAR does not have the details/answers to the questions because this is still a work in progress.  This lack of answers causes fear because it is human nature to fill in information voids with negative beliefs.  There is so much still unknown about TREC, that there is a lot of negative stuff being made up or inserted into the general thinking on Read more

Jerry Rubin Died A Stockbroker

The point of my title might not be obvious, and it’s not meant to discount youthful exuberance — God knows we need youthful exuberance. However, Peter Pan and Michael Jackson aside, we all grow up. What does that mean — grow up? I take its meaning as maturation, becoming wiser, thinking long term, becoming responsible to self and others.

Organizations, even countries, like individuals, seem to go through the growing up process — from infancy, to childhood to adolescence to young adulthood to middle age to the twilight years. If companies and countries can continuously reinvent themselves between young adulthood and middle age that’s a good thing. The analogy with individuals breaks down here, for the most part, because individuals can only “remodel” so much before the realities of age take over completely. However, individuals can stay fresh in mind and spirit for quite a long time through constant learning, reflection and openness. This freshness of mind and spirit coupled with maturity and wisdom is an attractive combination in individuals — these are the people I gravitate towards.

RE internet companies seem to be in their mid twenties. There is an emphasis, a feel, a persona, if you will, of “youth” with companies like Redfin, Zillow, Trulia and the rest. What is their phiolosphy? It’s like most 20 somethings; it’s a mixture of style, doing good, distrust of tradition, worship of change, but very little mature, rational long term vision. Unlike Realtor.com, they play their music loud, dress in t shirts and jeans, talk funny and love to give stuff away to their buds.

They are the RE version of Google starting out, just doing stuff with no business model, having fun, being different with an attitude and declaring like grandiose young mini-gods they will “Do No Evil“. Oh, I’m sure there are grown ups developing plans and thinking about making money, but this is the sense, the feel, I get from these companies.

Do they have to “grow up”? Can they survive in the business world by hanging out with their friends, creating stuff and giving it away? They will make more and more friends, that’s for sure, but Read more

Destination: Vertical. Zillow houses “hot or not” for homes

Dig this. Dumb but fun. A sticky way to see a lot of ads — but fun anyway.

Serious reflection #1: Another way for Zillow to be a sticky, top-of-mind vertical search portal. Get ’em there. Keep ’em there. Satisfy all of their real estate needs.

Serious reflection #2: The design sense in this new feature is far more sophisticated than anything we’ve seen from Zillow so far. I’m talking about a much higher standard of graphic elegance. Not jaw-dropping, but much better.

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Zillow.com makes its first MLS-wide feed agreement and, in the process, disintermediates its first IDX cartel

Here’s the PR, which the vendor cheerleaders will have reported:*

Leading real estate Web site Zillow.com and MLS Property Information Network today announced a partnership to feed listings from the New England area MLS to Zillow.com on a daily basis. This partnership initiates the first participation at the MLS level in Zillow’s Listings Feed program, which launched in November 2007. To date, the Zillow Listings Feed program has attracted several top brokerages for participation, and now allows all customers of MLS PIN to automatically gain free marketing exposure for their listings on one of the most-visited real estate sites in the country, while providing Zillow’s users with a more robust search experience.

That is, rather than having made yet another feed agreement from a brokerage or a franchise of brokerages, Zillow will be taking a feed of every listing from MLS PIN — a fairly big MLS system.

Okayfine. Now here’s the actual news:

Each listing will include a description of the property with multiple photos and contact information for the listing agent, including links back to the listing brokerage’s Web site where they can find more information and connect with a sales associate to guide them through the home buying and selling experience.

That is to say, whatever form the IDX agreement takes at MLS PIN, it is being cast aside for the Zillowfied listings. The IDX-like policy of concealing the listing broker’s and agent’s contact information will not be the policy for Zillow’s echo of the MLS PIN feed. (I find this so amazing that I’m avidly listening for some back-peddaling.)

There’s more. If a listing agent creates a profile on Zillow.com, that will be linked through from that agent’s listings. The MLS PIN feed will provide information for Zillow’s Virtual Sold Sign program, which is another way of promoting individual listing agents. This is all of a piece with Zillow’s general policy of promoting individuals rather than organizations.

But the important fact is that Zillow’s agreement with MLS PIN splits up the clubby conspiracy against the consumer that is the MLS philosophy. If buyer’s agents are squealing in Massachusetts today, the proper target of their Read more

The Odysseus Medal competition — Voting for the People’s Choice Award is open

My take is that the most important news this week was Zillow.com’s announcement that it will be doing background checks on the loan originators it will be referring to consumers as a part of its forthcoming mortgage product. In consequence, this week’s short list is all about Zillow’s announcement and its implications.

So: We have just eight entries on the short list this week, out of a long long list of 115 posts. You can vote for the People’s Choice Award here. You can use the voting interface to see each nominated post, so comparison is easy.

Ahem: Please don’t spam all your friends to come and vote for you. First, what we’re interested in is what is popular among people who would have been voting anyway. And second, I’ll eliminate you for cheating. Don’t say you weren’t warned.

Voting runs through to 12 Noon MST Monday. I’ll announce the winners of this week’s awards soon thereafter.

Here is this week’s short-list of Odysseus Medal nominees:

< ?PHP $AltEntries = array ( "Brian Brady -- Mortgage Complaint? Mortgage Complaint? Welcome to The World Of Consumer-Policing at Zillow Mortgage”,
“Brian Brady — Zoriginators Delight
Zillow Mortgage: Zoriginators’ Delight or Bane?“,
“Michael Wurzer — Who Holds The Bigger Gun, NAR or Zillow? Who Holds The Bigger Gun, NAR or Zillow? How About Tomorrow?“,
“Mike Farmer — Zillow Nation? Zillow Nation?“,
“Morgan Brown — Zillow Launches Mortgage Lender Sign Ups Zillow Launches Mortgage Lender Sign Ups – Points to a New Way of Consumer Control of Mortgage Process“,
“Teri Lussier — Zillow creates the end of the world Zillow creates the end of the world as we know it, and I feel fine“,
“Todd Carpenter — Zillow Mortgages Zillow Mortgages to give loan originators \”absolutely free and unlimited access to consumers looking for a mortgage\”“,
“Sean Purcell — Success in Disbrokeration? How Do You Find Real Estate Success in Disbrokeration?“,
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    Deadline for next week’s competition is Sunday at 12 Noon MST. You can nominate your own weblog entry or any post you admire here.

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  • Zillow creates the end of the world as we know it, and I feel fine

    Perhaps it’s cabin fever; Dayton is dealing with a late winter blizzard. The city is shut down giving me plenty of time to put on my own little version of a big-thinking cap and ponder away the what-ifs. Call me foolish but today, with a fresh cup of coffee at my side, I’m taking on the subject of repealing real estate licensing laws. Oh my. First things first: I’ve never read Ayn Rand and I don’t study the finer points of Capitalism. I truly love freedom, but I don’t philosophize about it. Now that we have that out of the way…

    Let’s do a little time traveling. Step into the Way Back Machine and return to that point in time when you decided that real estate is what you wanted to do with your life. Do you remember that moment? You want to sell real estate. Forget what you know now and concentrate; remember then? You want to sell real estate. Consider what would have happened if there was no licensing. How would you have gone about breaking into the business? Don’t tell me you would have simply hung up a sign, c’mon, you know you wouldn’t get hired! Really think about this a moment- what would you have done?

    Is it reasonable to think that you would have spoken to someone who was already in the business? Would you have picked just anyone in the business, or would you have carefully considered the reputations, the business models, the success rates of different brokerages? I know we wouldn’t have brokerages the way they exist today, but for our purposes, we’ll stick with that terminology. So. Would you have looked- really looked- at the other agents working at that brokerage? Would you have sought out past clients to get their opinions and comments?

    Use your imagination and stay with me here. This is how you are going to feed your family. What are you going to do to make sure that you can put ramen noodles on the table? What if you want an occasional steak? You are working where you live, or in close Read more

    The NAR Has Caused Hell To Freeze Over

    I don’t know if Hell has actually frozen over. Even though I’ve been told to go to hell many times over the years, I’ve not actually gone there (in the literal sense). So I can’t say I’ve seen it frozen over. But if a year ago someone had told me that I would gladly and joyfully be sharing a stage with Glenn Kelman – and that I would have previously publicly stated that Glenn is not only brilliant but also a really nice guy – I would have said, “you’re nuts.” He won’t want to get on the same stage with me and neither do I. I would have been wrong. Glenn and I will be sharing the stage for our debate at BHB Unchained on May 20th. (None of this it to even imply that I won’t point out why Redfin, the company, is doomed to failure – but Glenn, himself, is destined for greatness.)

    A year and a half ago, BHB was famous for bashing Zillow. Pointing out what was wrong with Zillow (and getting huge traffic, as a result). Zillow is now the main sponsor of BHBU. And David Gibbons, from Zillow, has practically become an icon in the area of how to win people over and get them to like you and your company.

    But those two items above are just the introduction to what prompted this post. Jay Thompson has a blog called NAR Wisdom. When it was first started it didn’t seem Jay even wanted his name on it. But before long his name was on it and the blog consisted primarily of posts critical of and (rightfully so) mocking NAR. But check this out. I wrote there that I am impressed. I am impressed. And delighted.

    East meets West.

    Some things may take time but as far as I’m concerned this is the best news about the future of our industry I’ve ever seen. Now if we can emulate David Gibbons’ style (WWDGD?) we can get David Gibbons’ results too.

    Hell Freezes Over

    I’m all in.

    Do you want some earth-shaking news? In showing us a first tentative glimpse of its new mortgage lending product, Zillow.com may in fact be reinventing — and perfecting — Capitalism

    I’m going to get the newspaper news out of the way first:

    Starting now, if you are a loan originator, you can register with Zillow.com to receive mortgage and refinancing referrals from that Seattle-based internet start-up, once it ramps up its full — but still Top Secret — mortgage lending product. From Zillow’s PR team, presumably in the form of a Zillow Blog post:

    To participate in this new product offering, lenders must have their professional status confirmed prior to connecting with borrowers, so we want to give lenders a head start on the process:

    1. Register with Zillow, if you haven’t already.
    2. Then apply as a lender, and answer a few questions about yourself.
    3. While access to borrowers is free, a one-time application fee of $25 is necessary to cover the costs of having an independent third party confirm your professional and employment status to Zillow. This is the only charge to participate; there are no other fees.

    Why register early? The confirmation process can take up to several days. By registering early, lenders ensure they will be among the first to be notified when the product launches and ready to service borrowers on Day 1. We’ll also send out an e-mail to all pre-confirmed lenders giving them notice immediately after launch.

    I don’t know what form Zillow’s lender referrals will take, but the important point — to which we will return — is that only duly-registered loan originators will be receiving them.

    Zillow takes some pains to take away your fear of future pain:

    While we’re not sharing more details right now, we can say that we’ve built our product around Zillow’s model of openness and transparency that is increasingly important in today’s home lending environment. And, consistent with our information-based model, we have no intention of being part of the transaction.

    There’s a sweet little teaser at the end:

    And if you happen to be in the market for a home loan, stayed tuned to this space as we announce an entirely new kind of mortgage offering built just for you.

    Brian Brady believes that what Zillow will offer as its sticky mortgage product is a sort of interest-rates Zestimator. In Read more