Only one year into the business, Google’s mortgage comparison ads convert into closed loans better than any other lead provider, says a new report from Leads360.
Despite rates being at historical lows in 2010, government regulation and the changing composition of the mortgage sales structure had a big impact on the number of leads purchased according to a new report from Leads360.
“The changing requirements and profit opportunities in the mortgage space have led to a significant decline in mortgage brokerages versus mortgage lenders,” said the report.
Using data from 560 of its mortgage clients (direct lenders, banks, brokers), the company found the number of leads purchased in 2010 declined each quarter versus the same quarter from the previous year. However, data shows that the lead volume decline slowed between Q4 2009 and Q3 2010. “This may be a signal that lead buying will increase in 2011,” said the report.
Results from a survey conducted by lead buyers and providers found a more optomistic outlook for 2011. According to the report, 55% of Leads360 clients said they expect to increase the number of leads purchased and 57% of lead providers expect more demand from buyers. Rather than rely on lead providers, 55% of lenders expect to the number of leads they generate on their own in 2011.
“Over three quarters of all clients said that they would increase or significantly increase their ‘self-generated’ lead volume,” said the report. “These leads are typically generated from the client’s own advertising, direct response programs, website, and referral programs.”
For the first time, Leads360 ranked different lead providers and found that only a year after launching their product, Google Comparison ads provided the highest conversion rate among providers. LendingTree and ReallyGreatRate tied for second, with Adchemy and Bills.com tying for third.
Interestingly enough, getting in contact and qualifying shoppers from Google is more difficult. The search engine giant didn’t even rank in the top three of highest qualification rates, said the report. GetSmart and LendingTree took home the top spot, delivering the highest percentage of leads that were contactable and interested in the product/service the lead buyer was offering.
As far as highest growth in the mortgage vertical, Zillow lead the industry in 2010, followed by LoanBright and Bills.com.
“LoanBright expanded its business among the growing number of mortgage clients looking for less expensive leads with acceptable closing rates,” said the report.