Flongle is a new crowdsourcing website that assists customers in finding the best home loan by making banks and mortgage brokers bid against each other. Billed as the world’s first “mortgage contest”, the site allows home buyers to post their ideal mortgage anonymously. You can then sit back and watch as banks, non-bank lenders and brokers compete to “win” the loan.
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Flongle was founded by mortgage broker and author Michael Lee, who has been pushing for improved home loan transparency for the better part of a decade. (His previous business ventures included the mortgage broking businesses bSmart and Mates Rates which both refunded a percentage of all commissions to the borrower.)
Flongle attempts to deliver the best home loan to borrowers without them having to shop around. Once a proposed mortgage has been posted, customers can compare the various deals that pop up and choose the one that best meets their needs at the lowest price. The site does not receive commissions from lenders, which means there’s no incentive to rip off the borrower.
“The reality is, a broker’s bias can end up costing you thousands if earning their commission comes ahead of genuinely finding the best deal for you.” Lee explained in a statement. “After all, anything from the loan amount, term and the features you choose can all mean more money for them.”
There is a significant catch to Flongle however: customers are required to pay a one-off fee of $399 to post their proposed mortgage. This leaps up to $799 if you require one of the site’s “mortgage experts” to guide you through the process from start to finish. On the plus side, Flongle provides a money-back guarantee that it will find a loan that best fits your needs at the best available price.
Each mortgage “contest” runs for up to seven days during which the customer’s loan proposal can attract hundreds of bids. There are currently more than 50 verified lenders and mortgage brokers registered to the service.
Incoming bids are automatically filtered and ranked according to cost and how well they match the borrower’s requirements and overall cost. The dollar-based comparisons also include any “hidden” fees in the total. According to Flongle, the whole process usually takes less than two hours; from creating and launching the contest, through to reviewing bids and choosing the winning bidder.
As well as sourcing new home loans, the service can be used to refinance existing mortgages or to simply get a “health check” of market conditions. For more information on how the service works, head to Flongle’s website and take the guided tour.