The biggest Internet lead generator in the home lending industry says it’s enhancing the quality of its leads by tapping into credit scores generated by its parent company, Experian.

LowerMyBills.com says its “premier quality” leads enable lenders to target borrowers with lower credit scores and sell them more profitable, higher-cost loans. 

The biggest Internet lead generator in the home lending industry says it’s enhancing the quality of its leads by tapping into credit scores generated by its parent company, Experian.

LowerMyBills.com says its “premier quality” leads enable lenders to target borrowers with lower credit scores and sell them more profitable, higher-cost loans. 

Acquired by Experian in May 2005, LowerMyBills.com has experienced slower growth in the first half of 2006, in part because of contraction at a major client, Ameriquest Mortgage Co., according to an interim financial report released Tuesday.

But earnings “grew strongly … as LowerMyBills.com focused on more profitable marketing spend and used Experian data and analytics to improve the quality of leads it generates for lenders,” the report said.

Experian reported $965 million in sales in North America during the first six months of the year, a 19 percent increase from the same period the year before (those numbers also include revenue generated by the company’s credit reporting services, and earnings by PriceGrabber and other online subsidiaries).

In an interview before the report was released, LowerMyBills.com president and founder Matt Coffin told Inman News how the company is benefiting from its relationship with Experian.

With an “overabundance” of leads for purchase loans over the last few years, the quality of leads has become a core focus at LowerMyBills.com, Coffin said.

LowerMyBills.com now requires a Social Security number with all requests for home purchase loans, Coffin said. Under the site’s terms of use, users agree that by submitting a request for a quote, they authorize LowerMyBills.com and its clients to use their Social Security number to obtain credit reports and credit scores.

Along with Equifax Inc. and TransUnion LLC, Experian is one of the three major U.S. credit bureaus. Experian has enormous stores of data on consumers’ credit histories, and the experience to analyze it, Coffin said.

“We have now started down the path of leveraging a lot of these core assets at Experian … to provide a better quality lead,” Coffin said. LowerMyBills.com’s “premier quality lead,” he said, allows lenders to select particular “credit bands” they would like to receive as leads.

Visitors are willing to provide their Social Security numbers in part because Experian’s acquisition of LowerMyBills.com gives the site added credibility, Coffin said — a benefit that’s passed along to lenders.

“When consumers find out about a lender through LowerMyBills.com and Experian, we think they see lenders in a better light,” he said. “We don’t have data (to back that claim up), but we think it’s evolving that way.”

Although LowerMyBills.com and LendingTree.com began selling their leads five times instead of four this spring, Coffin portrayed the change as a win-win for lenders and borrowers.

“What we were seeing is that as there was no detrimental impact on conversion rates by selling leads five times,” Coffin said. At the same time, the more loan offers a consumer is matched with, the higher their satisfaction, Coffin said.

Lenders who buy leads from LowerMyBills.com include Aegis Lending Corp., Ameriquest Mortgage Co., Champion Mortgage, Countrywide Financial Corp., HFC Corp., IndyMac Bank F.S.B., New Century Financial Corp., NovaStar Financial, Quicken Loans, and Wells Fargo Bank.

The slowdown in the housing market has many lenders originating fewer purchase loans and more refinance and home equity loans. But LowerMyBills.com continues to generate plenty of leads in all categories, and demand is steady as lenders compete for a smaller pie.

“I think that’s one of the key insights of what is happening, which is that as the mortgage industry may have various contractions, the Internet industry continues to grow very rapidly,” Coffin said. “What we see happening is the percentage of ad dollars spent by mortgage lenders or bankers (on the Internet) increasing.”

Coffin estimated the Internet captures about 17 percent to 18 percent of lenders’ advertising budgets, up from around 10 percent two years ago.

“What’s driving that is the Internet, with the lead generation side, is a pay-for-performance model, and consequently there is a lot less risk than direct mail or TV or radio advertising,” Coffin said.

LowerMyBills.com’s animated Flash ads are seemingly everywhere on the Internet, and the company has gone to court twice in recent months to win judgments protecting its advertisements against copyright infringements. Coffin said that as video grows in popularity it’s likely LowerMyBills.com’s Flash ads will start showing up on sites like YouTube. 

When Coffin spoke to Inman News in the first week of November, the company had 18 job openings on Monster.com. That number has since grown to 21 postings.

“We’re continuing to grow, ” he said. “We are super committed to getting big.”

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