What Is Lending Tree and Can It Hurt Your Credit?

Andrew Reyes
bank credit cards

Getting to a place where your credit score qualifies you for low-interest rates, a mortgage, or a higher credit limit on your credit card can be tough, but it is possible. It’s a lot easier to ruin your credit than protect it, and those who haven’t prioritized their financial health may find themselves in this position.

Some lenders will work with those who have no credit or poor credit. But, some scammers may take advantage of these individuals. Lending Tree is an online service that helps consumers compare loan options and lenders while avoiding scams.

Table of Contents

What Lending Tree Will Do

credit score graphics background with lending tree logo

As an online loan marketplace, Lending Tree connects users with several lenders around the country. With both an online presence and a downloadable app, consumers can follow their credit score, access information on how to improve their score, and compare lenders and rates for several different loan options.

Lending Tree is a financial resource for those of all credit types, providing resources on calculating a payment, understanding mortgage rates, or sorting through credit card options.

While there are resources that offer financial help, the site is a connectivity tool, rather than a direct provider of assistance. Lending Tree uses the information consumers provide to connect them with lenders that meet their specific needs. This includes the type of loan they are looking for, based on their credit level.

Not every lender is willing to work with individuals who have unfavorable credit scores. But, Lending Tree does the hard work of narrowing down the best options for a particular situation or consumer.

It’s possible that Lending Tree may not be able to match a consumer with a lender. Though there is a wide network of lenders across the nation in place, it’s possible that your credit history doesn’t meet the requirements of network lenders, or that there wasn’t enough information provided to narrow down lending options. There are several lenders in the network that accept credit scores as low as 600.

Personal Finance Help

The Lending Tree app is a great resource when it comes to personal finance tools. You can connect your bank accounts and your credit card accounts to the Lending Tree platform, and use it to track your cash flow, spending habits, and overall budget. It can also monitor your debt load and offer insight into the best paths forward for improving your financial health.

It is not a financial advisor, but rather has the tools needed to educate yourself on your options.

Credit Score Tracking

Your credit score is the most important part of your financial health, as your ability to apply for a mortgage, open up a credit card, or apply for phone service depends heavily on your credit report. Your score is a snapshot of the bigger picture of your financial responsibility. By continually monitoring where your score is, you can work on improving it.

Many factors go into a credit score, and the resources and insight from Lending Tree explore these on a personal level.

Loan Connections

By inputting some basic information into the program, Lending Tree can return multiple quotes from various lenders for your loan requests. Using the system isn’t an agreement that you will do business with the possible lender. But, is rather a way to see what options are available without having to input your personal information on several different lender-specific applications.

While the lenders may be a part of the Lending Tree network, these will each have their own costs and processes if you decide to move forward with a specific lender. Your actual rates and terms may also vary once you complete the lender’s application.

Interest Rate Comparisons

By accessing several lender quotes at one time, you could potentially save yourself thousands of dollars throughout the life of a loan. Shopping around can be time-consuming, particularly when you need to input your personal information across dozens of sites.

This service will do the comparison for you, bringing you information on interest rates and terms. It can also do more than just compare rates across lenders. It can help you compare rates across savings accounts, CDs, and IRAs.

What Lending Tree Will Not Do

Many programs will connect consumers to lenders for a fee, or they will require funds to guarantee a loan. This is not what Lending Tree advertises. There is no fee for the service that matches a borrower to a potential lender. They also only work with legitimate lenders, and none of the loan servicers you wouldn’t want.

Harm Your Credit

Lending Tree, as a company, does not directly impact your credit. It does request your Social Security number to provide potential lenders with access to your credit report. Lenders require both the information you provide and the information included on your credit report to extend loan quotes. Giving your Social Security number can make you vulnerable to identity theft. But Lending Tree does not use this information to steal your identity.

In its security policy, Lending Tree states the measures it has in place to protect any information provided online through encryption, secure web pages, and firewalls; however, it cannot guarantee complete security.

Hard Inquiry

Issuing your Social Security number for use in credit checks could lead to hard inquiries from the lenders who receive your loan application. This is where the trouble can arise concerning your credit. Many of the complaints registered against Lending Tree claim that the lenders who received an application made a hard inquiry on their credit report.

Potential lenders will use a consumer’s FICO score to assess financial responsibility and creditworthiness. But every time a check is made, it can bring down the score a few points.

The top complaint is that consumers using Lending Tree didn’t authorize a hard inquiry on their credit report. And yet several lenders conducted one. Since the program may issue your personal information to dozens of lenders, this could have a terrible impact on your credit score. According to an article posted on the Lending Tree website, it is illegal for your credit to be pulled without your consent.

It is also mentioned that Lending Tree conducts a soft inquiry on your report. But the company does not control when a potential lender may conduct a hard inquiry.

Repair Your Credit

Becoming a part of the Lending Tree program will not repair your credit. If you are drowning in debt, have missed payments, or need to establish positive credit history, this isn’t a direct-help service. Lending Tree can connect you to agencies or resources that can help you with credit repair. But the company itself can’t help your credit report.

Having access to your credit information is one way to take steps toward repairing your credit. But you must still investigate the different options available for potential credit harm.

Guarantee Lending

Even though it advertises itself as a lending marketplace, Lending Tree cannot guarantee your loan eligibility and approval. The basic information you may provide to the site could return several quotes from respectable lenders. But the loan process is done through the lender and not Lending Tree.

The quote you receive may not be what you are given when you fully apply to the lender. Many reviews indicate that the rates quoted were not the same as what was extended when finalizing the loan.

There are also complaints about the fees charged by the lenders. Origination fees and prepayment penalties could increase the amount of money you will be paying for your loan. If your finances get overextended, being late on a payment, or missing the payment altogether, will damage your credit.

Getting the loan finalized at terms that you find favorable isn’t guaranteed through Lending Tree match-ups. But the resources can give you an idea of where to look for a loan.

What Lending Tree Requires

Lending Tree is an online platform, though it has released a mobile app for users. Loan requests are done through the online service, and fax, mail, or email requests are not allowed. This would reduce both the efficiency and security of the process, as well as increase operating costs for the company.

Lending Tree does accept requests over the phone, and this process relies on the same information taken through online submission.

It is very important to carefully enter your information when making a request to avoid security concerns, inaccurate quotes, or delays in the process. A mistyped email address could lead to another individual receiving communication concerning your loan request.

Entering the wrong Social Security number could result in the wrong credit being checked. This could keep lenders from extending a quote.

What Lending Tree Does Not Require

You are not required to accept any of the loans offers presented to you, and there is no fee for refusing offers. However, when you accept an offer, you may be subject to the fees of the lender. If you are not interested in pursuing a loan request further, Lending Tree requires users to work directly with a lender to cancel the request. This is an important area to take note of when working with Lending Tree.

What Lending Tree Does With Your Information

Many consumers have left reviews criticizing the use of their personal information and the substantial number of emails and phone calls received from third-party affiliates of Lending Tree. Though the company directs consumers to deal with a lender directly when canceling a loan request, the privacy policy published by the company indicates that personal information is shared with LendingTree affiliates, network partners, financial companies, and other business partners.

When using a Lending Tree service or submitting an inquiry, you consent to have your information shared.

The company claims to use your personal information for the following:

  • Improve their website
  • Deliver on your request for services or products
  • Create a more personalized user experience
  • Improve elements of customer service
  • Manage the overall business
  • Communicate new products and services that could be of potential interest to a user

However, the company posts a disclaimer as to how third-party agencies handle the information received from Lending Tree. Consumers are to take an active approach in safeguarding their information by checking directly with third parties, and by periodically reviewing the privacy policy to understand or be made aware of any modifications to it.

What You Can Do About Loan Options

Even if you have bad credit, there may be a lender willing to extend a loan for a new car, home, or credit account. While Lending Tree can make it easy to find several offers in one place. It doesn’t guarantee you the best rate or terms for the financing you need.

There are several things you can do if you want to avoid handing over your personally-identifying information to a company that will pass it on to an unknown number of other organizations. Your credit should always be protected, and this may mean identifying loan options on your own.

1. Work Locally

It may be advantageous for you to start with a local financial institution for a loan or credit account. Credit unions often have more flexibility than traditional, chain lenders, and can work with those whose scores aren’t where they need to be.

2. Make Credit Improvements

If you know you will be needing financing in the future, don’t waste your time looking for interest rates and lenders while your credit score is low. Take some time to improve your credit rating before comparing options or making requests. You are entitled to one free credit report a year from the major credit bureaus, and you can use your report to make positive changes to your score.

Financial Support Beyond Lending Tree Services

Lending Tree is just one of many services that can help consumers address their lending needs. For resources on how to check your credit score, how to repair your credit, or the best credit cards for your situation, turn to the services of Fiscal Tiger. Be informed about your credit health.


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