Editor’s note: This story has been updated to include additional companies participating in Google AdWords Comparison Ads. 

A new advertising service from Google allows consumers to compare multiple offers from mortgage lenders that are generated automatically when prospective borrowers enter information about the loan they are seeking along with their credit rating.

Unlike some similar services, Google’s AdWords Comparison Ads for mortgage allows consumers to refine their criteria and request loan quotes anonymously.

Google launched Comparison Ads for mortgage in Beta test mode in October. Google’s moves to make for-sale listings more available to the search engine’s users — and rumors that it is interested in acquiring real estate search service Trulia — have generated considerable interest in recent months (see story).

Google moved Comparison Ads for mortgage out of the Beta test phase today, allowing vendors to announce their roles in the project.

Four companies are providing pricing engines that allow lenders to provide loan quotes automatically: Mortech, OpenClose, Optimal Blue and PriceMyLoan.

Mortech and OpenClose are also providing lead management systems for lenders, along with three other companies: Kaleidico, LeadMailbox, and Leads360.

Loan pricing engines plug information submitted by prospective borrowers into individual lenders’ underwriting criteria and pricing.

Mortech’s pricing engine, for example, is one of several approved for use on Zillow’s Mortgage Marketplace and LendingTree.com.

Mortech President Don Kracl said one way Google’s Comparison Ads differ from Zillow’s Mortgage Marketplace is that consumers using Zillow’s service get "a dozen, two dozen, or 100 quotes" from lenders.

Google’s Comparison Ads, he said, allow potential borrowers to submit their loan criteria and credit rating in order to see rates and fees offered by lenders that are "pretty accurate — (but) not exactly accurate."

Users can then click on a particular lender or lenders they are interested in obtaining more information from and request an actual loan quote anonymously, he said.

Kracl said 15 to 20 lenders in 15 states are currently participating in Google Comparison Ads for mortgage, with additional lenders being added as Google is convinced they will manage leads and work well with consumers.

"I’ve been told there are 30 licenses pending, and that they should be in excess of 40 states in the next month or so," Kracl said. …CONTINUED

Zillow’s Mortgage Marketplace claims 5,597 participating lenders, who the company says have provided 11.3 million loan quotes and received 660,000 mortgage requests.

When users call a number listed for a lender on Google Comparison Ads for mortgage, they are actually calling Google, which forwards calls to lenders so that the consumer’s phone number remains confidential.

Google plays the same intermediary role if lenders want to phone consumers, and says it will not reveal the consumer’s e-mail and street address.

For lenders, Google’s AdWords Comparison Ads combine AdWords’ ability to deliver targeted ads based on a user’s search criteria, serving up customized rate and pricing information in side-by-side comparisons.

"Google Comparison Ads for mortgage is what every mortgage lead generator should have built but didn’t," Jay Weintraub blogged at Leadconfidential.com when the service launched last fall. "And, it is because they didn’t build it that Google did."

Weintraub, who organizes an annual conference on lead generation, LeadsCon, thinks the Comparison Ads platform will work "amazingly well" for mortgages and other financial products that can be compared, like credit cards and insurance.

But Weintraub said Comparison Ads require standardized data — such as the information delivered by loan pricing engines — and therefore won’t put companies that generate leads for other industries out of business.

Comparison Ads, he said, are "a game-changer but not a category-killer."

Nick Hedges, a senior vice president at Leads360, called Google’s platform "the slickest, most user-friendly consumer mortgage-quoting product on the market by a considerable margin," when it launched in Beta.

"Mortgage brokers are going to struggle in a world where consumers can get instantaneous mortgage quotes online," Hedges wrote on his blog. "Assuming that all of the lenders jump on this bandwagon, which I think they will need to, then I believe consumers will gravitate to this way of finding a lender versus going through a broker."

In an e-mail, Hedges told Inman News that he thinks companies that offer lead management services, like Leads360, stand to benefit more from partnering with Google than pricing engines, because "in the long run large banks will want to supply rates to Google directly." …CONTINUED

Leads360 claims 2,800 mortgage companies use its software to receive, contact and convert leads, with a platform that’s integrated into 1,200 Internet lead sources including LendingTree, Quinstreet, Zillow and LowerMyBills.

Mortech’s Kracl disagreed with Hedges’ claim that Comparison Ads "will put a nail in Mortech’s coffin." Mortech is providing both a pricing engine and lead management integrated into a single product, Marksman, Kracl said.

Google’s Comparison Ads for mortgage "provide another outlet for our lenders to participate and get additional leads integrated into their system" — the main source of revenue for Mortech in its collaboration with Google, Kracl said.

LendingTree sued Mortech in August, alleging that making its pricing engine available to Google would breach a confidentiality agreement between the two companies (see story). The lawsuit was settled on confidential terms in September.

Kracl said that although LendingTree is switching to LoanXEngine as the company’s "preferred" pricing engine, Mortech "still has a significant presence at LendingTree, and we expect we will continue to do so."

LendingTree’s more extensive consumer questionnaires set its business model apart from Google and Zillow, Kracl said.

"They get quality leads because the questions they ask people add a lot to the qualification process," Kracl said. "Anybody will tell you LendingTree leads are superior to others."

LendingTree did not respond to a request for comment.

Kracl said Mortech is also working with several newspapers and MLSs to provide a mortgage pricing "widget," and is planning to launch a Web site, TheMorty.com.

According to a company newsletter, TheMorty.com will encompass "all things real estate and mortgage related," including a "for sale by owner" (FSBO) listing service, real-time rate look-ups, and a "Find a Service Provider" tool.

"It keeps growing in concept," Kracl said. "It will be a few weeks before we’ll have something solid."


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