Some lead generators, in order to boost their business, may initially provide free leads to mortgage companies. They would require the mortgage company to get contracted with them later. Sometimes some companies provide free leads in the beginning of a stipulated contract - the mortgage company may have to pay for future leads.

Free mortgage loan lead generating companies mostly work online. They generally contact mortgage companies through illegal spam, providing many incentives besides the free mortgage lead. Even buyers of mortgages are targeted and they are provided incentives like lower rates of interests. People seeking mortgages are invited to fill online application forms, which are then sorted according to various demographics. Important demographics considered are credit status of the person, monthly income, geographical location, purpose of the mortgage, etc. This list of leads along with the demographics is provided to the company. These demographics help the mortgage company to decide their strategy of contacting the leads and also shed some light on the genuineness of the lead.

Actually, some free mortgage loan leads may not be free in the real sense of the term. There may be a very nominal payment to be made by the mortgage company for acquiring leads, which will be much lesser than recruited loan generators. There could also be registration charges for the website itself. Free lead generators also begin asking for their commissions once their goodwill in the market is set up. Till that time, they would attempt to scout for genuine leads. Hence, in a way, it is safer to rely on free loan generator companies.

On the other hand, there are critics who contend that free loan generators are all a big sham. Their basic question is, why would any site sell genuine leads for free? Such critics are usually sites that take commissions for providing leads to companies. Yet, the genuineness of free mortgage lead generators remains a hazy issue.