Update: Somewhat surprisingly, Google Compare is shutting down by March 23rd, 2016.
We’ve heard rumblings of a mortgage comparison tool from Google, but today it finally became official.
The mega search (and everything else) company announced the availability of “Google Compare for Mortgages” this morning in a blog post on their AdWords site.
Google noted that nearly one out of two borrowers don’t shop around when taking out a mortgage, which appears to be the impetus for its launch.
Starting today, you can comparison shop for a mortgage using Google Compare for Mortgages, well, as long as you reside in California. The company plans to roll it out to other states soon.
How Google Compare for Mortgages Works
The new tool works like existing mortgage comparison tools in that you answer questions related to your prospective loan and receive tailored quotes.
Google refers to it as a “seamless, intuitive experience that connects lenders with borrowers online.”
It goes a step further than other comparison sites by asking how long you plan to stay in the home and what you can reasonably afford.
I played around with it this morning and was actually pleasantly surprised.
When you get to the compare page, you have the option of viewing all rates or using their “Guided Search.”
If you opt for the latter you’ll be asked a series of questions starting with mortgage purpose and your zip code.
As noted, it’s only available for California residents, so if you live outside California but want to play around with it, enter a California zip code for now.
Once you enter in that basic info, it will ask for the estimated property value, current mortgage balance, and credit score.
Additionally, they note that a higher credit score will result in a lower interest rate and better financing options.
You’ll then be asked how long you plan on owning the property. In a blog post on this site, I brought up the question of how long you plan to keep your mortgage.
This is important because you shouldn’t overpay for a long-term fixed mortgage if you plan to sell in the next three or four years.
But if you do plan to hunker down, a fixed mortgage might be a wise decision to avoid any interest rate resets.
Then they list the recommendations based on all your answers into separate groups of quotes.
Notice I entered 30 years of ownership. I also indicated that I could afford a very large monthly payment so they recommended a 15-year fixed.
If I had put four years of ownership and entered a smaller affordable monthly payment it might recommend a short-term ARM instead.
On the results page you’ll see something like “cheapest over 30-year period” and another list of quotes if you want “to pay down quickly.”
I like this feature of the tool because it goes beyond lowest rate and actually explains why you’d choose one loan option over another based on your own unique situation.
Once you get to the final page you’re also able to expand the loan criteria to change the occupancy type, include VA loan eligibility, or mention any past credit slipups.
If you want to get to that page faster, simply click on one of the “view all” buttons at the bottom of the start page and you can enter all criteria on a single page to update the results.
Going forward, you may see the new tool when conducting searches for a mortgage-related term on Google. You can also visit the comparison tool directly here.
If you’re an advertiser, you can get your company listed in Google Compare for Mortgages on a flexible cost-per-lead (CPL) model.
Both LendingTree and Zillow have already separately announced partnerships with Google on the new venture.
Read more: How lenders come up with your mortgage rate.