The online mortgage marketplace Zillow allows for instant connection between buyers and lenders. (Photo : Wikimedia Commons)
The innovative Zillow Mortgage Marketplace, which revolutionized lending with its ability to connect borrowers and lenders instantly online for loan options and real-time mortgage rates, will acquire Nebraska-based Mortech, a mortgage technology software company, PRNewswire reported.
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Zillow will pay $12 million for the acquisition in cash and 150,000 shares of restricted stock in a deal that is expected to close by the end of the year.
Seattle-based Zillow took the mortgage industry by storm when it came on the scene in 2006, with its online “Zestimates” allowing users to type in an address and instantly get an appraisal. Last week the company launched a new site that lists homes headed for foreclosure, allowing potential buyers to get a jump on the market.
According to the company’s website, there are currently more than 10 million homes listed in its database.
The Lincoln, Nebraska-based Mortech offers subscription-based software providing matches between borrowers and lenders, management platforms, and other marketing tools. It was founded in 1987 and has 39 employees, PR Newswire reported.
News of the acquisition came after Zillow announced fourth-quarter revenue expectations of $30 to $31 million, lower than analysts’ predictions of $32.5 million, as reported by Thomson Reuters. The company’s Chief Executive Spencer Rascoff said the estimate was based on the fact that fewer people buy homes in the fourth quarter, resulting in fewer advertising dollars. The forecast sent the company's shares down 25 percent.