Most high-technology companies are generally found near California cities or in a few other tech-centric outposts such as Seattle (mostly to service the Microsoft juggernaut) or Northern Virginia (generally telecommunications).
Mortech Inc., a mortgage technology company, hails from the relatively tiny technology node of Lincoln, Neb. Sure, the University of Nebraska is based in Lincoln, but one of the main reasons Mortech is located there is because Don Kracl, the company’s founder, grew up about 70 miles away. And, oh yes, he is a graduate from The Big Red.
While not well known, Mortech boasts more than 20 years in the mortgage technology business and is a leading software supplier, most of which involves the transfer and exchange of information and data on the business side of creating a mortgage product.
Basically, Mortech supplies all-in-one pricing, rate notification, rich prospect management tools, and loan product eligibility and guidelines services to lenders and loan officers.
As great as all that sounds, frankly none it is of much interest to homebuyers. It’s just techie stuff for the money sources and their outlets.
However, earlier this year, Mortech took a different turn, making a big run toward the consumer world as it teamed up with Google on a program that gives homebuyers the opportunity to go Internet shopping for a better mortgage.
Starting late last yaer, Google began testing AdWords Comparison Ads, a feature that allows consumers to shop and compare prices. It’s Mortech’s technology that allows participating lenders to list instant mortgage-rate quotes.
"The launch of Google’s new Comparison Ads feature comes at a time when potential homebuyers want more trusted information from the mortgage community," said Kracl.
"With Google’s new offering, potential borrowers can view live rate quotes from dependable mortgage professionals in an easy-to-understand and consistent manner."
The feature does not require Google visitors to enter any private information, makes the lending process more transparent, and allows for consumers to access reliable rate quotes instantly.
"As a consumer you wouldn’t know that we exist because we are really at the back end of the whole thing," explained Kracl. "Google came to us because they wanted to use our data for mortgage loan quotes."
So, for example, if you type into the Google search bar the words "Mortgage Rates California," the first entry when the search is completed is the line that reads "Compare Mortgage Rates" and a small activity box with the words "compare rates" on the inside. When folks click on that bar they end up with a list of mortgage companies, rates, terms and contact numbers.
The day I clicked the activity box, two pages of quotes were listed. The first entry read: New American Funding; 4.875 percent interest rate; 5.039 percent APR; terms (click line for lender and loan details); an infomercial line that boasted 24 hr approvals; and finally a telephone number to call (click line to send a message).
"If you happen to click on one of the lenders, then the lender would be using our technology and data," said Kracl.
The best way to understand the value of the Internet in terms of the mortgage business is to realize that 55 percent of all people who get a mortgage today do some online research, observed Philip Kneibert, president of Mortgage Lenders of America, an Overland Park, Kan.-based mortgage banker.
That’s one reason why he has been aggressively pushing his company further into the world of online lending. Out of the 100 employees at his business, he has five teams of 10 people focused on online purchase transactions and one team of 10 people focused on online resale.
For homebuyers who are interested in getting a mortgage, they just need to go to Google, fill out a few basic questions and the rate quote is there. For the mortgage banker, that’s fine because those people are just looking for rates; they don’t get any more serious about getting a mortgage and they don’t needlessly tie up brokers.
"The aspect of the lead generation program through the Google-Mortech collaboration, and what makes it unique and provides value to us, is that under a traditional lead you get a lot of people who are just tire kickers, they just want to know what interest rates are," said Kneibert. "Through the Google program, you get your rate quote before you even move forward."
Google’s AdWords Comparison Ads create a different environment. "If the homebuyers are interested in moving forward," said Kneibert, "they just click on the button about getting more information from the lender. The customers that come through are more serious."
Mortgage Lenders of America has been working with the AdWords Comparison Ads program since the end of last year and has already closed a bunch of loans.
"When we started on the Google AdWords Comparison Ads feature we didn’t know what to expect but after a few short weeks we quickly embraced the innovative concept," said Kneibert.
One of the things Google brings is a big brand name. The Zillow Mortgage Marketplace and LendingTree also offer mortgage rate comparisons.
Google gives online mortgage-rate comparison sites "more legitimacy and viability," said Kneibert.
Mortech likes the consumer side of the business so much that it’s beginning to partner with leading websites that provide real estate listings so as provide real-time mortgage-rate offers.
"Not long ago, it used to be difficult for a consumer to compare and find someone who had different rates and different terms in different states," Kracl said. "Now, it’s getting pretty easy."
That’s a good thing because it’s important for the homebuyer to be informed. At minimum, they’ll know what a realistic mortgage rate should look like.
"Homebuyers can now be armed with as much mortgage information as readily is available," Kracl concludes. "That’s really the goal of this whole process, to give consumers the knowledge they need to make the best decisions."
Steve Bergsman is a freelance writer in Arizona and author of several books, including "After the Fall: Opportunities and Strategies for Real Estate Investing in the Coming Decade."