The initial article of this series examined why the first generation of third-party multilender websites failed, despite rosy expectations and heavy investments by deep-pocketed firms. This article and those that follow will discuss the features that are central to the success of the next generation of sites that will appear in 2011. Perhaps the major feature, discussed in this article, is provision of competitive loan pricing.
Competitive price quotes vs. competitive price locks
A core function of the third-party network is to collect, store and display price quotes from multiple participating lenders. While this generates competitive price quotes, it does not necessarily generate competitive lock prices that lenders are obliged to honor. A failure to recognize the difference was a critical mistake of the first generation of multilender sites.