double POSITIVE Marketing Group, Inc.

Today we re-launched our corporate website, www.doublepositive.com. The site is chock-full of new content and features. Most exciting among the new features is a video demonstration of the LIVE Hot Transfers process, which is going to be tremendously helpful as we expand DoublePositive into verticals including insurance leads, debt leads, real estate leads, automotive leads, and education leads.

Why are lead buyers buying less leads in the mortgage vertical? The volume of consumers calling and filling out online forms is as high now, if not higher, then it ever has been. Well, quite simply, loan officers aren’t closing loans, companies are being forced to close up shop, and that results in less money in the marketing pool. The reasons for the numerous lay-offs and businesses that have shut down are obvious – the sub-prime meltdown and the implosion of mortgage-backed securities. I’m curious what phase we’re in now though, recovery? Everyone is wondering if we’ve hit the bottom yet, and watching to see who emerges from the wreckage. The question is, are we helping ourselves get over the hump? The continued advertising on radio, television and the Internet – for the same mortgage programs that got us in this mess in the first place – can’t be helping. What are your thoughts, do we need to move past the ads promising monthly payments too good to be true? If so, what is the evolution of the marketing message that will benefit consumers, provide customers with quality leads and – not kill volume? Can everyone have their cake and eat it too? I would love to hear your thoughts?

On a side note, I did find some subtle humor in the articles I was reading:

The article:

“We have to stop them plain and simple. We have to stop the ads and we have to stop the mortgage brokers from their deceptive practices in general.”

Now view the screenshot of the article

The article:

“There is little debate that mortgage industry practices have created ill effects for lenders, consumers, and the economy as a whole,” Eva Weber, the Aite analyst who authored the report, said in a statement. “The question now is when the fallout from these practices will dissipate. The unfortunate answer is that things may still get worse before they get better.”

Now view the screenshot of the article

Don’t you just love dynamic ad content?

I’m sure you’ve seen the headlines, and the question:

Was the Fed action on Aug. 17 effectively a Countrywide bailout, saving a company many saw as too big to fail?

Fed watchers and banking experts say far more is at work here. The Fed wasn’t reacting to Countrywide’s plight as much as the conditions that put the lender in such deep trouble.

I’d love to get your thoughts. Was the fed reacting to conditions or to Countrywide, the last giant standing?

Everyone sees these headlines every day about what’s going on in the mortgage industry, and it seems that each day another mortgage company is closing its doors, being acquired, or laying-off employees.

We all know the industry is facing monumental changes right now. And if you still need a reminder of how dramatic these events are, just take a look of this long, long list of companies that have recently closed, merged or had to do massive layoffs.

1st National – Arizona-based Alt-A wholesale lender cuts 212 employees
Aegis Funding – closed, seeking bankruptcy protection
Accredited – buyout from Lone Star in jeopardy
ACC Capital Holdings – mass layoffs at parent of Ameriquest
Acoustic Home Loans – closed subprime wholesale lender
ACT Mortgage Capital – suspended all submissions/fundings until further notice
Alliance Bancorp – closed
Alterna Mortgage – closed
Alternative Financing Corp. – wholesale division closed
American Home Mortgage – closed
Ameriquest – laid off 3,800, closed 229 retail branches after $325 million settlement
Amstar Mortgage Corp. – most of staff at corp. headquarters in Houston being laid off
Argent – for sale
Aurora Loan Services – layoffs at this Lehman Brothers lender
Axix Mortgage – closed
Bank of America – Countrywide merger possibility, continued layoffs
Bear Stearns – closed two hedge funds after huge subprime losses, 240 subprime layoffs
Blackstone Group – buying PHH Mortgage
BNC Mortgage LLC – layoffs, consolidated with Aurora Loan Services
Broad Street Mortgage – sold to Wausau Mortgage Corp.
Calusa Investments – website down, thought to be closed
Capital One Mortgage – 2,000 layoffs planned nationwide
Central Pacific Mortgage – closed, TMSF cancels deal to acquire company
Charter Funding – believed to be closed by parent First Magnus Financial
Chevy Chase – cuts correspondent channel
Choice Capital Funding – rumored to be closed
CIT Group Inc. – exiting residential mortgage lending
Citadel – buying ResMAE
Citigroup – bought ABN AMRO Mortgage Group, mulling acquisition of Argent Mortgage
Clear Choice Financial – in default, Bankruptcy possible
CMXL – acquires All Fund
Columbia Home Loans – subprime lender closed
Concorde Acceptance – rumored to be closed
CoreStar Financial Group – closed
Countrywide – layoffs in subprime , may be bought out by Bank of America
Dana Capital – closed
DB Home Lending – rumors are stirring
DeepGreen Financial – closed
Decision One – closed six regional centers
Deutsche Bank Correspondent Lending Group – consolidating business to MortgageIT
Ditech – 181 layoffs
Dollar Mortgage Corp. – being acquired by Shearson Financial Network
Domestic Bank – shutting down wholesale unit
E-loan – closed sub-prime wholesale division
ECC Capital/Encore Credit – sold to Bear Stearns, 100 layoffs announced Aug. 17
Entrust Mortgage – closed
Equibanc – closed by Wachovia
Express Capital Lending – not accepting new submissions until further notice
Fannie Mae – hundreds of layoffs coming
FBR – selling subprime unit
Fieldstone Mortgage – closed Las Vegas branch
First Community Bancorp – layoffs
First Consolidated Mortgage Co. – subprime wholesaler shutting down, in dispute
First Indiana Wholesale – closed wholesale consumer lending operations
First Magnus – no longer funding or originating any mortgage loans
First NLC Financial Services LLC – 645 layoffs
First Source Funding Group – closed
First Street Financial – closed
Flexpoint Funding – reportedly closed wholesale division
Flick Mortgage – closed
FMF Capital LLC – closed
Freestand Financial – closed
Fremont General – exited secondary sub-prime market
FundingAmerica – not accepting any new business
General Electric – buying PHH Corporation
Golden Empire Mortgage (GEM Capital) – closed
Great Southwest Mortgage – believed to be closed by parent First Magnus Financial
Greenpoint Mortgage – closed, 1900 employees laid off, 31 branches closed
Guaranty Residential – layoffs
H&R Block Mortgage Corp. – layoffs
Heartwell Mortgage – closed
Heritage Plaza Mortgage – closed
HMIC – closed
Home 123 Mortgage – closed
HomeBanc Mortgage Corp. – closed
Home Capital Inc. – closes
Home Equity of America – layoffs
Homefield Financial – closed
Homeland Capital Group – subprime wholesaler closed
Home Loan Center Inc. / Lending Tree – layoffs
Homeview Lending Inc. – layoffs, now appears to be closed
HSBC Mortgage Services (Correspondent division) – closed, layoffs
Huntington Financial – to be acquired by Oxford Funding
Impac Mortgage Holdings – layoffs, halted Alt-A loan production
Indymac – bought retail arm of New York Mortgage Trust, layoffs
Innovative Mortgage Capital – closed
Investaid Corp. – suspended operations indefinitely
Ivanhoe Mortgage – closed
KBC Bank NV (Belgium) – buying Vertical Lend
KKR Financial Holdings –no longer intends to invest in residential real estate
Lancaster Mortgage Bankers – closed
Lender’s Direct Capital Corporation – closed wholesale lending operations
Lending group Inc. – suspended operations
LendingTree – 20% of workforce laid off (fresh ones on Aug. 17)
Loancity – closed 7 branches, shut down
Loans 123 – no longer taking anymore business
Lone Star – facing lawsuit over purchase of Accredited Home Lenders
LowerMyPayment.com – closed, mortgage lead company
Luminent Mortgage – two default notices, selling equity stake to Arco Capital Corp.
Mandalay Mortgage – closed
Maribella Mortgage – closed
Master Financial – layoffs, ceased wholesale production
Mercantile Mortgage – seized operations
Metrocities Mortgage – layoffs
MGIC – bought rival mortgage insurance provider Radian Group (pending)
Mortgage Investment Lending Associates (MILA) – subprime wholesale lender shuts down
Millenium Bankshares – closed mortgage division
Millenium Funding Group – closed
MLSG – halted lending operation
Monarch Bank – buying mortgage-related assets from Resource Bank
Mortgage Investment Lending Associates – closed
Mortgage Lenders Network – stopped residential loan production
Mylor Financial – closed
National Home Equity – consolidated by National City Corp., suspended originations, layoffs
Nationpoint – a subsidiary of Merill Lynch laid off 60 people on August 15, 2007
Nation One Mortgage C0. Inc. – wholesale lender stopped origination and funding of mortgages
Nationstar – acquired Champion Mortgage
Netbank Funding – closed
New Century – filed bankruptcy
No Red Tape Mortgage – parent company Metrocities closed wholesale division
Northern Rock (UK) – issued profit warning
Novastar – closed wholesale unit, facing potentially huge lawsuit, laying off 37% of workforce
Oak Street Mortgage – closed, files bankruptcy
Opteum – closed conduit and wholesale operations
Option One Mortgage Corp. – layoffs, pending sale to Cerberus Capital Management LP
Own It Mortgage – closed
Oxford Funding – acquiring Huntington Financial
Pacific American Mortgage (PAMCO) – no new submissions, halted operations
People’s Choice Financial Corp. – bankrupt
People’s Mortgage – closed
Popular Financial Holdings – exited the wholesale sub-prime mortgage market
Premier Mortgage Funding, Inc – filed for bankruptcy
Quick Loan Funding – layoffs, now reported closed
QuoteMeARate.com Inc. – closed
RAMS Home Loans (Australia) – warned of profit losses after only two weeks on stock market
Residential Capital LLC – cutting roughly 1,000 jobs (GMAC company)
ResMae – layoffs, bankrupt/for sale
Resource Bank – selling mortgage-related assets to Monarch Bank
Right Away Mortgage – closed
RFC – layoffs
Rose Mortgage Corp. – closed
Saxon – layoffs
Scottish RE – large subprime exposure drops stock into dangerzone
Sea Breeze Mortgage Services, Inc. – Irvine, CA office phone disconnected, rumors of closure
Sebring Capital Partners – closed
Secured Funding – closed
Shearson Financial Network – to acquire Dollar Mortgage Corp.
Silver State Mortgage – closed
Solutions Funding – closed
Southstar Funding – closed
Sovereign Bancorp – exited wholesale market
Spectrum Financial Group – stopped funding loans, halted operations
Starpointe Mortgage – closed
Steward Financial – closed
Stone Creek Funding – closed
SouthStar Funding – closed
Summit Mortgage – closed
The Mortgage Warehouse – closed
Thornburg Mortgage – 5 downgrades, need to sell some assets to stay afloat, denied BK
Trojan Lending – ceased wholesale production
Trump Mortgage – closing
Unlimited Loan Resources – closed
Velocity Commercial Capital, LLC – layoffs reported, still breaking
Wachovia – closed Equibanc, layoffs
Warehouse USA – closed
Washington Mutual – layoffs, exited correspondent market
Wells Fargo Alternative Lending Wholesale – closed, layoffs nationwide
Winstar Mortgage – ceased operations
WMC – GE’s subprime unit cut 460 jobs

More at TheTruthAboutMortgage.com.

I grokked a good bit about the mortgage industry in the most recent edition of PositiveWire.   As a follow-on, think to yourself about the industries that have been reported the most for their fall from grace lately.    Here’s what most would probably guess as of August 2007: 

• Mortgage
• Newspapers
• Music

I have to scratch the third item off the list since I would ramble-on forever on that one.  However, Mortgage and Newspapers have a common thread via Google and DoublePositive. DoublePositive’s mission is to become the Google of LIVE leads. Google is bullish on continued opportunity for growth in the newspapers industry.  DoublePositive is bullish on continue opportunity for growth in mortgage industry. Both Google and DoublePositive have ties to music too, but I’ll have to save that for a MUCH later post. ;-)  SPF 

The uneasiness we’ve heard for months in the voices of some of our mortgage clients has rippled around the world’s financial markets in the past week, and with analysis from the investment banks like the kind that Marc Andreessen revealed in his blog the other day, it’s no wonder. 

While the Fed’s discount rate cut this morning promises to ease the short-term credit crunch,  a welcome shard of clarity from Tyler Cowen this morning (with links to other sound commentary) speaks to the underlying issues in the mortgage arena.    I’m reading his newly published Discover Your Inner Economist: Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist right now, and may well end up at George Mason to do my Economics PhD. thanks to it and his ethnic food guide to the greater DC metro area. Viva la Marginal Revolution!

I saw this story come across my inbox today and I had to chuckle. Two of us from DoublePositive spent the last 2 days locked in a room with many of the biggest mortgage lead generators, leab buyers, and service providers that touch the mortgage leads industry. The Leads2007 Conference was a great meeting and we talked about many important issues facing the mortgage leads industry — arguably the largest and most mature online lead generation category.

We’re not an “association” per se, we’re just a bunch of companies and individuals concerned with sharing true best practices. We talked about how there have been a couple of failed attempts at organizing lead generators in the past, such as the Internet Advertising Bureau’s Lead Generation Committee and the Online Lead Generation Association. Neither of these associations seems to be creating much noise (the last OLGA blog post was over a year ago).

But today the IAB released this report on Lead Generation Data Transfer Best Practices. The report proposes a standard on the transfer and receipt of data between advertisers and lead generation service providers. Ok…. I guess we need that. Standards are good.

But while the IAB is talking about things like SSL encryption and  XML schemas, we spent the last two days talking about things that will really help the industry — things like improving the consumer experience, lead buying practices, sales approaches, and innovations in lead generation. 

Yeah… Leads2007 rocked! XML schemas… not so much.

There was an interesting Q&A article in the news this week that featured Kerry Killinger, chairman and CEO of Seattle’s Washington Mutual Inc. There were several questions, but one in particular grabbed my attention. It read:

“Q: In broad terms, could you tell us your impression of what happened in the mortgage market and how it happened? Foreclosure activity is increasing as adjustable-rate loans are reset. Who is to blame?”

I realize this question has been asked and answered ten-fold over the last few months – and you can read Kerry Killinger’s answer and the entire Q&A session at: http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2007/08/12/BU72RBP6U.DTL

But I was curious what you thought of the CEO’s response, and in general, your thoughts on where the mortgage industry is heading?

This came out of one of our sessions this morning. There was a lot… and I mean a lot… of discussion about how damaging trigger leads are to our industry. They have become the major reason why consumers are “crucified” these days, being bombarded with dozens of phone calls from an initial lead form submission.

Check out StopTriggerLeads.org.  It’s a site that helps inform consumers about what trigger leads are all about. There is some good content there that lead providers can also use to help use to educate their clients as well. 

Check out this video. What obligation do lenders have to tell their consumers what will happen when a consumer’s credit is actually pulled???