Posted: Marcus Varner | September 28, 2015


Watch Out For These 7 LendingTree Problems


"When banks compete, you win."

lending tree problems

It's a tagline that any consumer looking for a loan could get behind, and LendingTree has put it at the forefront of its ads since its launch in 1998, promising to get multiple lenders to "compete" for each customer and get them the best rates in the process. It brings to mind an almost Bachelorette-esque scenario, with multiple suitors tripping over each other to win a customer's business.

Too bad what actually transpires is more like a stampede-and the customer is the one left trampled to death.

lending tree problems

Notwithstanding LendingTree's almost two decades of advertisements and an A+ rating with the Better Business Bureau (BBB), the company leaves many of its customers on the losing end of their business model.

Lead selling. Bad customer experiences. Unchecked scams. One online complaint after another hits on these themes with alarming frequency. Meanwhile, LendingTree seems to make only lukewarm efforts to rectify these issues, probably because these problems are directly tied to the company's revenue stream.

Therefore, if you're thinking of using LendingTree to find a loan, you should be wary of the most common problems customers experience with the company. Here are the seven most common complaints (and reasons you might want to avoid LendingTree):

lendingtree problems

1. LendingTree actually does very little to help their customers compare offers

In its own mission statement, LendingTree makes this noble promise:

"We serve as an ally to consumers who are looking to comparison-shop and make informed purchase decisions for loans and other important transactions. We do so by providing consumers with a broad array of information and tools free of charge, conveniently located on our various websites."

It's amazing-and a little sickening-that so much of LendingTree's marketing emphasizes the ability to compare offers from lenders when the actual customer experience falls so short in the comparison department.

One disgruntled customer, in their complaint filed with the BBB, gives a glimpse into the reality of LendingTree's comparison features:

"The commercial leads you to believe (using images of a person typing on a computer and seeing graphs with various rates) that you will get a side-by-side comparison of rates from different lenders. This is not what happens. Instead, they are sharing your personal information with hundreds of third parties resulting in day and night non-stop phone calls."

To be fair, Lending Tree does provide places on their websites where different loan options are placed side by side, including interest rates, such as their Loan Explorer page. As might be expected, these interest rates are usually unbelievably low-low enough to persuade any customer to give their personal information to LendingTree.

Unfortunately, numerous complaints make it clear that the actual interest rates that lenders offer to customers rival those of the worst credit cards, many of them up in the 30-percent range. (More about this below...)

And the whole thing about customers being able to see all those offers side by side? When the offers do come, they're not neatly organized on a well-designed web page. Instead, inboxes fill with waves of messages from various lenders. Phones ring off the hook. Offers come in one phone call or email at a time. Unless you have your own spreadsheet handy, it gets really hard to keep track and compare each offer that comes in.

On this topic, the LendingTree FAQ imparts this advice, with a "no-duh" helpfulness that borders on mocking:

"It's important that you evaluate all of the terms of each offer before you choose the one that's best for you. Compare the interest rate, APR, points, loan amount, loan term and other details of the loan offer. Please use our online calculators to help you make your decision."

lending tree problems

2. LendingTree doesn't measure up to its promise of low rates

The LendingTree promise of lenders competing for customers is really about delivering lower interest rates than customers could get by just walking into their local bank. The banner currently splashed across their home page even promises, "5/1 ARM Rates as low as 2.63% (2.97% APR)."

Sadly, it seems LendingTree does little to make sure the lenders in their network actually deliver on this promise. Even customers with the best credit history are served offers with interest rates far above those advertised on the site.

"Supposedly, my score is good at 759," said Cyndi of Morristown, Arizona, on, "but none of the loans could give me... a good rate. Not one of the loan offers was below 14% interest."

Mariam of Annandale, Virginia had a similar experience when she received an offer for three times the amount requested, at three times the interest quoted by her local bank.

LendingTree really has two choices here. Either:

  • Stop telling their customers that they can get them lower interest rates, when they really have no control over what the lenders in their network do; or...
  • Work with their lenders to secure better rates for their customers.

So far, LendingTree has shown an inability-or unwillingness-to do either of these things.

3. LendingTree lacks transparency in extra fees and costs

The costs of finding loans through LendingTree don't end with higher interest rates. Again because of the lack of control LendingTree seems to have over the lenders in their network, they're also unable to make sure that customers get all the facts on the extra fees they will be paying before they assume loans.

Sadly, customers often discover these extra fees only after they've signed on the dotted line.

"I did not discover the loan fee, $720, until I received my deposit of the loan into my account," one LendingTree customer complained on the BBB website:

"Immediately I called to inquire about the disclosure of the loan. The representative even had trouble guiding me to the location of the costs in the documents. She even acknowledged that the information may have moved or the documents may have changed. I borrowed $18,000. The loan origination cost was $720. So my loan was actually $17,280."

Another customer complaint submitted on tells of lenders quoted amounts not matching up with reality.

"After looking at all the offers and then sitting down and doing the real math, every single offer I received would have cost far more in the end than what they said," the customer says. "When I confronted them with this, all I got were excuses."

4. LendingTree mercilessly spams its customers

Nearly all online reviews of LendingTree come with warnings about giving the company your name and number. These are accompanied by horror stories of customers barely finishing hitting 'submit' when their phones and inboxes are inundated with an endless barrage of offers from lenders.

This where the aforementioned stampede comes in.

Consider this horror story from Dean of Alexandria, Virginia:

"Opened an account several weeks ago to simply look at what mortgage lenders and rates were. I have now been inundated and harassed with multiple calls and emails daily for several weeks. I have received multiple phone calls from the same mortgage company but different lenders ... Furthermore, my information has probably been sold multiple times to various lists for further harassment by less-than-scrupulous lenders."

Unfortunately, Dean's story is far too common, with the vast majority of LendingTree complaints with the BBB, PissedConsumer, and ConsumerAffairs echoing this same story. They lament the flood of calls and emails that befell them the moment they signed up with LendingTree and didn't let up for months. One of the worst tells of the customer receiving four robocalls before he'd even completed the online form; in three days, he received a total of 30 calls from eight different lenders.

In all fairness to LendingTree, customers can stop the barrage of communications from LendingTree and its partners. This page lets customers discontinue emails from LendingTree. This page is not easy to find, however.

For those wishing to stop phone calls and emails from lenders, there is a toll-free number and a website for the Consumer Credit Reporting Industry Opt-in and Opt-out. Again, LendingTree does not make this information widely known. Why would they?

lendingtree problems

5. LendingTree partners can kill your credit score

While endless calls and emails can be annoying and a nuisance, imagine what happens when a dozen lenders pull your credit score at the same time.

As any experienced consumer knows, every time a potential lender checks your credit score, it brings it down a notch. According to customer horror stories, LendingTree gives their partner lenders authorization to pull customers' credit scores, often without customers' permission.

Stacey of Kansas City, Missouri recounts on ConsumerAffairs:

"EVERY SINGLE company that called me (around 20) had pulled my credit report, even though I declined to accept that section and never actually submitted my application! So now a few months later, I'm in a better place to actually buy a house and my credit is shot because it looks like I had 20 people looking into my credit!"

And just how big of an impact can this have on a customer's credit score?

"My credit report got hit by who knows how many lenders," said Michael of Wilde Rose, Wisconsin. "In 60 days, my credit score went from 722 to 593."

6. LendingTree partners can also forget you completely

There seems to be a real sense of polarity among LendingTree partners. Some of them will not leave you alone. But some will, even after you've filled out an application with them, completely forget you.

Relates one customer, Paula of Rockville, Virginia:

"I applied on 6/12/15 and heard nothing Friday-Monday. I called them and they told me the person assigned to my account was out to lunch and would call me back. Heard nothing, so called again on Tuesday. The gentleman that answered the phone said my loan was not completed. I asked him, 'How would I know that if no one called me back.' He said, 'Recomplete the application.' However, when I went back into LendingTree for that company, it was not there."

This story and others like it highlight the fact that LendingTree has a real quality control problem. They can put all the promises they want on their website, but they really can't control how the lenders treat their customers. It's also obvious that many of the lenders are not the most competent/organized people on the planet.

As so many customers complain about this, what's most shocking is how often LendingTree seems to coast by with the excuse of "Well, that's the lender, not us. We aren't responsible for how they act."

But is that really true? As part of LendingTree being an "ally" to consumers, shouldn't they be constantly working on making this process better for customers?

Instead, LendingTree's actions (or inaction?) make the company's real priorities crystal clear: they care about selling as many leads to lenders as possible. What happens to customers after that is none of their concern.

7. LendingTree is a breeding ground for advanced fee scams

It's not surprising that scammers have found a way to exploit LendingTree's system. Heck, they find a way to exploit every other service out there. What is shocking is the hands-off attitude LendingTree takes to these scams.

Take, for instance, the advanced fee scams that have begun to spring up on LendingTree. These fake lenders reach out to LendingTree customers via email and get their hopes up with better-than-expected terms and rates. To qualify, they just need to pay some money up front, as their name implies.

The rest of the story goes something like this:

"After I paid $400 for an appraisal, I didn't hear back from them until I called them in the middle of December and then I was told that I wasn't going to get my loan. The loan officer told me that he wanted to close the loan by Dec. 1, and I would also need a septic tank inspection ($325) and a well test ($45.00) so I ended up losing a total of $770.00."

To be fair, these stories aren't unique to LendingTree. All of the major online lending marketplaces are being exploited in this way. On its FAQ page, LendingTree makes it clear that they will never charge customers up front for loans or loan processing. They also state that customers should check LendingTree's list of partners before applying with a lender. Um, thanks.

Although this information is nice, there is no indication that LendingTree is trying to directly combat the problem or protect customers from the threat.

lending tree problems

Is LendingTree the best lending marketplace for you?

All of the problems above lead to this question. For certain, no business is perfect, but the trend of recent complaints against LendingTree should make any customer wary of their services. Do they really offer a system where customers get the best rates, better than what they would find at their local bank? Customer complaints cast doubt on this.

Fortunately, there are some really great lending alternatives online where customers can avoid some of the issues that come with LendingTree.

To see personal lending sites that outscore LendingTree, visit our Personal Lending page today.


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Written by Marcus Varner

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