This post is not about the new Zillow Mortgage Bourse
... because it's been thoroughly discussed across the real estate blogosphere. As always, the gang at The BloodhoundBlog covered Zillow's new mortgage bourse. Check out the Odysseus Medal competition with links to well written articles including my personal favorite by Brian Brady who nabbed the People's Choice Award. Or click here to find all articles categorized under Zillow at BHB.
OK, the basic premise with the Zillow mortgage bourse is that a consumer can anonymously get rate quotes from different lenders who are participating. Anonymity has its advantages online and thus the reason for my post (or non post) as it were.
A few weeks ago, I saw this ad on Yahoo! I've seen it before. But I clicked away before saving the picture and then spent at least an hour going to and from Yahoo! to get it to pop up again so that I could save it and write about it. Of course, when you want to see an ad, it just won't be there. But thankfully, Larry Cragun at RealEstateUndressed snagged it and wrote about it as he (and I) have on previous occasions.
There are several things that are terribly wrong with this ad. First of all, it is designed to look like news. That in and of itself isn't so bad except that the news is twisted. Because the Fed cut interest rates, it isn't necessarily likely that mortgage rates will go down. And then there is the unrealistic payment of only $699 for a $180,000 mortgage.
This is exactly the kind of stuff that got too many borrowers in trouble and has fueled the current credit crunch and mortgage problems that many people are facing today.
What happens next if you click on the ad is that you will be required to provide your name and contact information and then that information is sold to a lender. You have become a lead.
I suggest you know who you are providing your contact information to when shopping online for a mortgage, a home or whatever. If you are looking for mortgage information, the best thing to do is to ask a real estate agent you trust to recommend a good lender.
Don't be misled by Internet ads and don't become a lead. At least on Zillow, you're not a lead. But please check out the lender, it's not just about a rate quote or saving a few dollars, it's really about obtaining a loan that you completely understand and terms you are totally comfortable with.
UPDATE: Jillayne Schlicke at Rain City Guide just posted on the subject of deceptive mortgage advertising practices including how to report mortgage advertising abuses. Click here for more.