I think you are right on all accounts, however there may be an additional factor that only substantiates and supports your theories and that is consumer confidence. Let me explain. Its my thought that the online mortgage lead generation vertical is nearing or entering its second generation of inquiries. Meaning, consumers have already once before gone through the process of searching online for mortgage help and have possibly experienced the typical lead gen process, which is fill out a form, have your information sent to 3-5 brokers, and possibly many more over time, received 10's of calls and quite likely left the process happy they received a refinance, but unhappy about what they just went through.

Therefore, consumers are looking for big brands, big banks and possibly avoiding the “Can you qualify for a 3.99% loan? Find Out Now” forms that go to an unbranded page. So this all leads to your Brand Value point.

You are exactly right about the Google effect. No doubt people are will to spend x amount of dollars more for their “own” marketing. Does it always pay off? Not usually.

I think one point that may have been overlooked was the actually decline in market value for mortgage leads. Over the last few years the average mortgage lead value as gone from $45 to $15 or even less. Now lead generation companies, working in the mortgage vertical, are being forced to drastically reduce payouts and we have watched that happen over the last few years. Frankly, I think that is the main reason. You didn't mention whether or not the lead form was converting less or not, but my guess the contextual ads are simply out performing the lead forms payouts and the form itself hasn't experienced a degradation in conversions, just a thought.

-Mike