While these sites may cover hundreds of lenders, the price information provided is generic, which makes comparison-shopping difficult to impossible. Consumers relinquish control over their personal financial information when they deal with these sites. Both referral sites and lead-generation sites have their uses, which will be discussed in a future column. The third type of multi-lender site is the shopping site, which is the only type that allows consumers to shop multiple competing lenders effectively. In addition, shopping sites offer most or all of the functions performed by a mortgage broker, including qualifying the borrower and taking an application.
Shopping sites allow the consumer to avoid dealing with a commission-incented loan officer.
When you look for a loan through other channels, odds are that the loan officer with whom you deal is compensated mainly or entirely by commissions paid on the loans initiated by that loan officer. In such case, the loan officer has an incentive to induce you to pay as high a price as possible. The shopping sites on the web operate in the tradition of fixed-price merchandising. There are no overages. They thus provide assurance to the consumer that they will not be taken advantage of because they are poorly informed, or are not aggressive negotiators.