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Step 1: Evaluating Lending Tree's Services and Offers
On LendingTree's website, you are prompted to select what type of loan you are looking for (Refinance, Home Purchase, Equity, etc.) as well as what type of home you have (single family, townhome, condo, etc). You are then asked to provide several details such as your estimated value of your home and balance on any existing mortgages.
Once you finish filling out the relatively short form, your loan request is sent out to various mortgage brokers. The reason that Lending Tree sends you out to multiple companies is because in theory, competition creates lower prices. If a mortgage broker knows you are talking to other mortgage brokers as well, they will likely try harder to accomodate you and "win" your business.
LendingTree's service does not cost you anything, because the company makes its money by selling your request to these brokers. Since the mortgage industry is quite a lucrative one, many mortgage brokers and loan officers will pay top dollar for even the chance at servicing your loan.
Lending Tree Home Page
Step 2: Finding Customer Feedback and Reviews of the Lending Tree Service
In theory, Lending Tree sounds like it should get you a good rate on your mortgage. Their plan to create competition is a good one, but not every customer is satisfied. To be fair to LendingTree, many of these unsatisifed customers that we found had a poor understanding of how the service works. For example, one gentleman was complaining about the interest rates that LendingTree had offered him, but LendingTree is not actually responsible for the offers you get. Their job is to simply generate offers; it is your job to decide if they are right for your situation or not.
To that end, we have attemtped to only include useful reviews from LendingTree users who actually seemed to understand how the service works. The comments below are sorted into three distinct categories. Postiive comments are enclosed in a green box, neutral comments are inside a yellow box, and negative comments or complaints are within a red box.
Please note that this is only supplemental feedback; for a more complete profile of this company, you may wish to do your own research by checking with the Better Business Bureau (BBB).
First, let's start with the positive comments on Lending Tree:
" I used [LendingTree] a few years ago when my credit wasn't as good. The third (and final) broker I connected with was AMAZING. She was an absolute crusader who got me funded at a decent rate when no one else was interested. "
User review found on http://answers.yahoo.com/question/index?qid=20070205175702AAwVKpf
" I used LendingTree to start the same process last year and was satisfied with the experience. I didn't end up going with any of the offers, but they were as good as anything else I was able to find. I'd recommend it as an educational exercise, at least. They are a reputable company and your data should remain secure. "
User feedback found on http://ask.metafilter.com/30106/Lending-Tree-Bad-idea
" I found the very best rate by far through using them on the house I live in now, plus 2 investment properties I purchased. However, I still shop around. You always should."
User feedback found on http://ask.metafilter.com/30106/Lending-Tree-Bad-idea
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Now, neutral comments or reviews found about Lending Tree (these can be taken as either positive or negative, depending on your perspective):
Finally, negative comments, feedback, or complaints found on LendingTree.com:
" They should be called Spamming Tree. The email account for which I used to solicit responses has been bombarded by spam since I applied...and worst of all the lenders it sent my way were small, no-name types that could disappear overnight."
Review found at http://www.city-data.com/forum/mortgages/236167-lending-tree-good-bad-loan-credit.html#ixzz1Sg7qvwRw
" I used LendingTree when I bought my house several months ago. I'd rate their service as poor. The mortgage company I found through them "lost" my application and all my information, despite having sent me a loan approval letter. LendingTree was absolutely no help when I called to complain about this. I ended up finding a mortgage on my own through a local branch of a well-known mortgage lender. I did find my realtor through LT, but LendingTree did not come through with the "cash / gift card reward" they promise at closing. (They gave me the run-around about this over the phone.) "
Opinion found on http://ask.metafilter.com/30106/Lending-Tree-Bad-idea
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Finding feedback for LendingTree was not hard -- they are a somewhat popular service that has been around for a long time and used by many mortgage brokers (including one I once worked for).
However, there are many people who do not understand that LendingTree is simply a lead generation company, and cannot be held responsible for the offers you receive.
That does not get LendingTree off the hook for its customer service complaints, though -- which it has received in some number. There are also accusations that occasionally LendingTree will not send your information to the 4 brokers it promises, or perhaps sometimes more than 4 brokers. Whether or not there is any truth to these accusations I cannot say.
Another common complaint with LendingTree is the amount of "spam" one receives to their e-mail inbox from the mortgage brokers. From what I have seen, I would tend to say that this is a valid complaint, and I have a suggestion for you.
If you plan on using LendingTree, make sure to make a NEW email address that you will use ONLY for your mortgage application. That way, once you are done, you won't have to worry about your email being flooded with interest rate spam.
For those who actually ended up closing a loan after using LendingTree, the reviews tend to be much more positive than those who never actually completed the process. While I didn't bother to list every snippet of relevant feedback I found in this review, if you have any experience with Lending Tree that you would like to share on this page, please send it straight away.
Step 3: Background Information
Despite LendingTree being around for a good while, it is still nice to know the background information and history of a company that you're going to be dealing with.
According to Wikipedia, LendingTree was launched in 1998 in Charlotte, North Carolina. Besides their home page LendingTree.com, they are also affiliated with or own GetSmart.com and HomeLoanCenter.com
In 2010, BanxCorp begain anti trust legal proceedings against LendingTree (among other companies). The outcome of this suit is still pending.
Fun fact: LendingTree is actually one word, although the company is often mistakenly spelled out with two words (Lending Tree)
The Verdict on Lending Tree - Does Lending Tree Work?
When it comes to getting a mortgage, it can be difficult to figure out where to turn. LendingTree promises to make this process easy by doing the "shopping around" part for you.
In theory, this works great. You get quick access to multiple mortgage brokers, and you have much more negotiation power for getting good terms on a loan.
Mortgage brokers are notorious for spam complaints. Before using this service, please follow my advice of opening up a new email address to use for the purposes of your application that you won't ever have to use again once the process is complete.
Other than that, there isn't a whole lot LendingTree can do wrong. They provide a simple service that has ended up being wildly profitable for them, and hopefully as equally beneficial for the borrowers they aim to serve.
-Robert Goldstein
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