Prompted by stagnant traffic and an overall tightening of the mortgage refinance market, lead aggregators are looking to grab onto anything that will improve their margins, or at least keep them from eroding.

Theoretically, the total value of a realtime mortgage lead should be the same no matter how many times it is sold. Let’s say a bank is willing to budget $3,000 to acquire a $300,000 refinance loan. If a lead has a 1 in 10 chance of closing, that each lead is then worth $300. Since a consumer can only close a maximum of one refi loan at a time on the same house, increasing the number of lead buyers, logically, should proportionately lower the price each of those buyers pays for the lead. So you’d expect that that same lead, sold four times instead of once, would now fetch $75 per buyer.

But that’s theory. In practice, other factors come into play. Having two offers instead of one increases the chances of the consumer converting, since there is a greater likelihood that one will interest them. But having, say, ten would be overwhelming, and likely turn the consumer off entirely and drive down to zero the chance of any of the lead buyers converting.

The balancing act is finding the optimum number of times a lead can be sold in order to maximize their revenue without ticking off the consumers or lead buyers too much. Is 5 too much, or just right? By moving to 1:5, lead aggregators are betting on the latter.

Are they right? Time will tell. In a future post I’ll discuss why this may all be irrelevant, plus what the implications are for affiliate marketers who target the financial services sector.