Mortgage Leads: The Business of Screwing Business

In a little over a year, I have developed an extreme contempt for ANYONE involved in the business of gathering or selling “information” related to connecting people who are interested in refinancing with the investors or brokers that can provide them the money they are looking for. These “lead companies” make their money in a Ponzi scheme fueled only by the existence of email, the internet, and the uninformed.

Here is how I think it operates; and I dare someone prove me wrong:

Enter Level 1 – Bob wants to make money but has absolutely NO marketable skills. Somehow, he gets partnered up with this guy, Adam, that has the secret to unlimited wealth. For only $5, Bob purchases a list of people from Adam – lets say there are 10,000 names – that has information about their home, property value, when it was last sold, and email address. All Bob has to do is simply send an email to each of the names on his list. He doesn’t even have to read English or compose a sentence since the body of the email is contained on a CD containing sample email templates. Imagine sitting at the computer and, between sessions of playing Everquest, copy, paste and send email. Life couldn’t be easier! Adam has received $5 and moves on to locate other “Bobs”.

No doubt you have seen the spam and junk mail that flows freely into your email inbox, right? Ever wonder how someone could possibly know that YOU have been prequalified for a $500,000 home loan at 3.5% regardless of your credit history or bankruptcy? Reality check, people! They aren’t talking to you. They are playing the odds that someone out there will think it was targeted for them, and respond willingly. [My question to you: Are these people really interested in refinancing? I say, “no”.]

Now for the payoff. For EVERY person that receives the email, clicks on the requisite link, completes and then submits a “so you want to refinance” form, Bob receives $1 dollar! Do the math: Bob recovers his “investment” when only 5 people respond. Hell, that’s only .05 %. Everything after that is gravy! Bob envisions himself vacationing in the Bahamas and running his business from his Blackberry.

Enter Level 2 – All of completed forms from “interested borrowers” are routed to a central database run by SlimeBall Leads Inc. that pays Bob and the thousands of others like him that Adam conned out of their $5 bills. Now, SlimeBall has a product that they can market to interested consumers – in this case, mortgage companies, banks, lenders, investors. That is, the people with the money! (You see where this is going?). Slimeball’s marketing team begins a telemarketing program to hook interested purchasers of these leads.

Lets suppose Mr. Mortgage needs to buy leads. After being contacted by SlimeBall, and listening to their pitch of why THESE leads are better (i.e. confirmed, checked, validated, pre-screened, etc) they agree to purchase 20 leads per day at $20 each. SlimeBall promises that they will not be sold to any more than 4 other lenders. Money changes hands and SlimeBall Leads ends up with $2,000 each week. Now, because there is no honor among thieves, they sell this same “package” to 10 other lenders (who’s counting, right?) That’s $20,000 a week to SlimeBall for its hard work. Actually, since they had to pay all of the Bob’s for the leads, they only end up with a profit of $19,900. (Do you think they report this as income on their taxes?)

Enter Level 3 – After SlimeBall Leads has sold all of its $20 lead packages to its “A-List” companies, and a week or so has gone by, they now sell these packages at $2 per lead to secondary lead resellers, such as BabySlime Co. So, another $200 into SlimeBall’s coffers per reseller.

Enter Level 4 – BabySlime Leads markets its “special discounted” leads for only $5 per lead to brokers, lenders, mortgage companies in a similar fashion as SlimeBall. But because the price per lead is much less, the unsuspecting purchasers are willing to “give it a shot”. For every package they sell, BabySlime Leads make $300, for 150% profit. Multiply that times the number of BabySlime companies out there and you can picture this dysfunctional, fractal universe.

So just what part of the mortgage business is this anyway? You end up with all this money changing hands and very little business of refinancing homeowners taking place.

So today, I come across this “innovative” offering, which makes me ask myself “who’s zooming who?” Wonder how they make their money? I have changed nothing from the way it was posted on the net, and you can see it is a pretty lame attempt at trying to legitimize itself. What a crock of shit!!!

Enter Level 5

About is going to bring Big Brother to the lead buying and selling business. will monitor both the lead companies and the mortgage brokers in the system and remove anyone who can not the follow the rules. Lead companies and mortgage brokers will have to agree upon a standard set of guidelines for lead returns and lead quality. will handle the lead return process to ensure that it is not abused by either side of the transaction. Mortgage brokers must prepay for mortgage leads and lead companies will not be paid for leads that are returned. will publish real time statistics for lead returns so it will become very evident very quickly which lead companies are selling bad leads and which brokers are returning too high a percentage of leads. This will self regulate all parties because if return percentages grow to high for a lead company, nobody will buy from them and if mortgage brokers return too high of a percentage, no lead company will sell to them. For security reasons and to keep parties from trying to circumvent the system, the lead company names and mortgage broker names will be held anonymous and will just be given ID’s by (who will know who everyone is obviously). fills a void that has needed filling for some time now. A safe place for mortgage brokers to buy leads and a safe place for lead companies to sell leads.

Interested? Contact us at and we will put you on the mailing list for when the site will launch.

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