LendingTree Personal Loans: Pros and Cons
As a lender marketplace, LendingTree is a great option if you want to compare rates from different lenders without having to submit a bunch of individual applications. However, you’ll have to navigate the individual fees and requirements of each recommended lender in order to find the best one for you.
LendingTree has partnered with some of the leading lenders across the country, allowing it the flexibility to offer a variety of options when it comes to personal loans. One of the biggest advantages is that you’ll still be able to find a lender even if your credit score is not the best, as LendingTree will work with lenders who can accept credit scores as low as 600.
If you do need help with your credit or any other aspect of qualifying for and obtaining a personal loan, there are plenty of resources on LendingTree’s website that can help you. From a credit/debt analyzer to credit repair options, you’ll find plenty of educational tools that will make it easier for you to reduce your debt or improve your financial position. Download the app and you’ll have access to a number of personal finance tools, including free access to your credit score.
While being able to receive multiple quotes for a personal loan within minutes is definitely a plus, there are drawbacks. Each lender will have their own costs, such as origination fees and prepayment penalties, so you still have to do some homework before choosing the right lender. Additionally, the quotes you’ll be offered aren’t guaranteed. Once you’ve filled out the application you’ll be dealing directly with the lender and not LendingTree.
Another drawback, and one of the biggest complaints, about LendingTree is that once you have submitted your information, it’s possible you’ll start receiving unsolicited communications from different lenders, even some you may not have been paired up with to begin with.
Finally, while LendingTree itself only does soft credit checks which don’t affect your credit score, it is crucial to point out that some of their partner lenders will do hard credit checks, which will affect your score. And unlike mortgage and auto loans, multiple credit checks for personal loans are all individually reported to the main three credit bureaus regardless of how close together they are. Multiple applications with different personal loan lenders can have an impact on your FICO score regardless of whether you are approved or not.
LendingTree Personal Loans Key Facts
|Some lending partners will accept credit scores as low as 600|
|Loan amounts vary between $1,000 and $50,000|
|Employment history and proof of income|
|Debt-to-income ratio of 36%|
|Home buying (not a mortgage)|
|Car financing (not an auto loan)|
LendingTree Company Information
LendingTree was originally established as Lewsburg Ventures in 1996, being renamed CreditSource USA shortly after. Renamed LendingTree, the company made its online debut in 1998 as one of the first online marketplaces to give consumers access to multiple lenders with a single application.
By 2006, LendingTree had processed 20 million loan requests and closed over $152 billion in loan transactions. By 2012, it had helped 30 million customers find loans.
Throughout the years LendingTree has been acquiring other companies to help expand its marketplace concept to not only other areas of lending but also help people with their credit. Among the companies acquired by LendingTree are SimpleTuition, CompareCards, MagnifyMoney, Ovation, and ValuePenguin.
LendingTree is currently headquartered in Charlotte, North Carolina with a second office located in Burlingame, California, and has approximately 1,000 employees.
LendingTree Personal Loan Products
Applying for a personal loan with LendingTree is easy, and you can do it online, by phone, or with the app. Simply answer a few questions, provide some basic personal and income information, including your social security number, and wait for the results.
At this point, LendingTree will perform a soft credit check and send your information to its lending partners. Within minutes you’ll get offers from 5 different lenders. Once you’ve received these offers, you’ll have to study them to determine which lender is the best option for you.
Once you evaluate the different offers and choose the lender that best suits your needs, you’ll need to finish the application directly with them. According to LendingTree, once you’re approved you could get the funds of the loan disbursed in anywhere from a few days to a few weeks.
Keep in mind that personal loans are unsecured loans, meaning that you don’t need collateral. The lender will make an offer depending on your credit score plus other financial information. But because there is no collateral involved, interest rates can be higher than usual, especially if you don’t have good credit.
LendingTree’s Educational Tools and Resources
While you may go to LendingTree’s website looking for a loan, once on the site you’ll also be able to take advantage of its substantial educational tools, calculators, and articles that can help you make a better-informed choice when it comes to the best lender fit. You can also download the LendingTree app to access your account, apply for a loan, or access all their educational resources.
These resources vary from articles that explain what unsecured loans are, when it makes sense to apply for one, and the benefits of taking out a personal loan. You can use LendingTree’s personal loan calculator, input your credit score and the amount of money you need to borrow, and get an estimate of your monthly payment before even applying for the loan.
If you’re unsure of what your credit score is, you can use LendingTree’s My Credit Score tool, which allows you to access your score for free and without any negative impact. There are also resources available dealing with credit repair and debt relief options, as well as information on how to build your credit.
LendingTree also has a credit/debt analyzer to help you evaluate your financial health and not only identify areas that need improvement but also provide information on how to make any needed adjustments.
LendingTree Application Process
|When requesting quotes from LendingTree, be prepared to:|
|Create an account before requesting loan quotes|
|Specify the purpose of the loan|
|Specify the amount you’d like to borrow, and how soon you need disbursement|
|Provide personal information including address, date of birth, social security number and income|
|Provide contact information|
|Provide proof of income and other financial info once you have chosen from the lender options provided|
LendingTree Personal Loans Fees
As a lender marketplace, LendingTree doesn’t charge any fees for processing your application and sending it to its lending partners.
However, each lender that you’re matched with will have its own fees, costs, and terms. You need to understand these fees and terms before choosing your loan provider. The most common fee associated with a personal loan is an origination fee.
An origination fee is a fee that is designed to cover the lender’s expenses related to processing and funding your loan. These fees can range from 1% to 8% of the loan amount and are usually charged upfront. For example, if you take out a $20,000 loan with a 1% origination fee, you’ll be paying $200 in fees.
In this case, the fee would be deducted from the total loan amount, and you would receive $19,800 in disbursements. Always consider the origination fee when determining the amount of loan you want to apply for or need, and adjust that amount accordingly.
An easy way of calculating how much you should apply for is to subtract the origination fee percentage from 100, then multiply your loan amount by the remaining percentage. In the above example, multiply $20,000 by 99%. The result, $20,202, is the amount you would need to apply for in order to get a $20,000 loan disbursement.
Some lenders may charge a fixed origination fee, while others may set the fee according to the borrower’s personal information. Factors that can affect what fee you’re charged include your credit score (the higher, the better), the loan amount you’re applying for, the loan repayment term, your income, the purpose of the loan, and whether you are using a co-signer or not (and that cosigner’s personal information).
In some cases, you’ll find a lender that doesn’t charge an origination fee. If you have competing offers from different lenders, some of which charge the fee and others that don’t, compare interest rates, terms, and any other features of the offered loan. In some cases, lenders won’t charge the origination fee but will increase the interest rate offered, so you may actually save money over the term of the loan if the lender charging the fee is offering a lower interest rate.
The other cost you’ll have to pay is the interest rate on your loan, which will vary depending on the lender and your financial information. At the moment, LendingTree says its partners are offering interest rates as low as 3.49% for those with excellent credit. However, interest rates can also be as high as 35.76%.
While LendingTree doesn’t charge any prepayment penalties, some of its lender partners do. Make sure you understand what penalties, if any, apply if you decide to pay your loan off early.
Does LendingTree offer Personal Loans?
Yes, they do. LendingTree will offer unsecured personal loans that can be used for just about any purpose. The minimum loan amount is $1,000, while the maximum loan amount is $50,000.
Is LendingTree a direct lender?
No. LendingTree is a loan marketplace designed to provide multiple loan offers from its lending partners, allowing you to compare offers from different lenders by submitting one single application.
How can I get a personal loan from LendingTree?
Applying for a personal loan from LendingTree can be done one of three ways: by phone, by completing an online application, or by downloading the LendingTree app and submitting an application.
What credit score do I need to get a personal loan from LendingTree?
LendingTree says it partners with lenders who will work with credit scores as low as 600. However, the minimum credit score requirement will depend on which lender you’re matched with.
Is there a penalty if I pay my LendingTree personal loan off early?
It will depend on the lender you chose to do business with. As an online marketplace, LendingTree does not charge a prepayment penalty, but some of its lending partners do. Before signing any loan agreement, verify if there is a prepayment penalty, and what the amount would be.
LendingTree Personal Loans: Summary and Key Takeaways
- LendingTree is a loan marketplace partnering with some of the largest lenders in the country.
- Provides free access to your credit score through the My Credit Score feature
- Easy application process that can be done by phone, online or via the LendingTree app
- Numerous educational articles and blogs about personal loans, when it makes sense to apply for one, and how to identify potential scams
- Works with lenders that accept low credit scores
- Provides links to debt relief options