Zillow Takes its Mortgage Marketplace Mobile

One added capability the mobile devices bring to the mortgage process is the capability, in theory anyway, of combining automated mortgage tools with the actual shopping experience — allowing borrowers to access automated lending data while they are looking at a new house instead of sitting in front of a computer at their old home.

Zillow's new iPhone app aims to combine a long-standing automated mortgage shopping staple — rate aggregation — with budgeting calculators and other personal financial tools that can be accessed directly while shopping for homes.

This week, the Seattle-based Zillow expanded its four-month old iPhone app, which is currently being used by consumers to access rate information and quotes on about 2.5 million homes per day, to include the Zillow Mortgage Marketplace. The expansion is designed to give Zillow iPhone app users access to research, shop and compare mortgages — and get some information how a mortgage will impact their personal budgets — without leaving the original shopping app.

"We're seeing that our users are shifting their shopping behavior from online to mobile," says Erin Lantz, a director for the Zillow Mortgage Marketplace, who says about 20 percent of all Zillow traffic is on mobile devices, a percentage that increases to 30 percent on weekends. "Home financing is part of the shopping process. We want to make sure users have access to their financial information when they need it."

Added services include a payment calculator that helps consumers estimate what their monthly payment will look like for a particular home based on income and credit level; an affordability calculator that allows users to determine and narrow their search to a specific price range; and a function to receive personalized loan quotes, lender reviews and single-click contact to lenders to start a preapproval process. "Customers can figure out how much it will cost to buy a new home and can figure out a range of homes that they can afford," Lantz says. "They can also compare the expense of a new mortgage with their current mortgage."

The firm built the app internally, integrating the calculators to the back end system it uses to generate quotes for participating lenders. It's a native app, but it does include some web pages that allow Zillow flexibility to edit and update information on actual lenders quickly. Zillow's network includes several hundred mortgage lenders, which pay as advertisers to be included.

The new Zillow iPhone app expansion is a bit different than the web-based personal financial management tools that banks have been adopting over the past few years — it calculates the hypothetical impact of a prospective mortgage on a consumer's budget as accrued from rate quotes and other basic borrower data, rather than collecting information on personal expenditures and bills over a set period of time. But analysts say there is a natural fit for quickly accessed digitally delivered personalized budgeting tools as part of mortgage financing.

"For most Americans, buying a home is the biggest and most important financial decision of their lives," says Mark Schwanhausser, a senior research analyst for Javelin Research. "It will shape their lifestyle, and their ability to buy and save and invest for other goals."

Schwanhausser says the Zillow app is similar to a USAA app for buying a home or a car. "What I like about it from a bankers' perspective is that these mobile apps can put the FI into the financing discussion," he says,

But Schwanhausser also says PFM tools for home buying, like all PFM tools, need to be carefully tailored to the device, which perhaps would result in a tablet being the best home for rate quotes tied to affordability and other budget calculators. 

"Geolocation, maps, taking pictures of homes, sizing up which houses to tour…those are ideal for a smartphone," he says. "But I suspect more homebuyers would prefer to use the payment and affordability calculators on a tablet or PC. I'm skeptical about the usage of these calculators in an iPhone app. The iPad, that's a different matter."

Intuit's Mint.com has a similar feature to Zillow's new app, called "Way to Save," that compares home loan options to a person's income, debt ratio and credit. Mint.com works with CreditSesame.com on the product, which provides bank-level analytics produce loan options for consumers. The Credit Sesame analytics engine creates a financial profile—including current debts, loans, assets and available credit. It evaluates that profile against thousands of products from lenders and brokers, producing a customized list of loan options.

"We want show people home loan options that they will qualify for. And we'll also look for loans based on information such as how long people want to stay at their next home," says Ksenia Kouchnirenko, Mint.com's director of business development and strategy, adding the service is not available for mobile users, saying that Mint is focusing its mobile activities on other personal financial information, such as account balances, as well as other mortgage-related info such as data on how a certain type of mortgage finance may produce savings on monthly payments.

Mint.com and Zillow are also partners on a product that helps consumers determine their homes' value as part of their overall financial portfolio. The home valuation uses Zillow's "Zestimate" algorithm for real estate analysis that helps produce the home values.