LendingTree Review

Jon McDonald

LendingTree is a marketing lead generator that unites lenders with consumers looking for vehicle financing. It can quickly find multiple lenders at no cost and without obligation.

- Jon McDonald, 7/26/2022

Written by: Jon McDonald

Jon McDonald

With more than 15 years of journalism expertise, Jon stays apprised of finance trends, influential companies, and financial literacy resources for subprime consumers. He is most knowledgeable in the areas of budgeting, loans, and responsible credit use, and his articles have appeared in publications produced by The New York Times.

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Edited by: Lillian Guevara-Castro

Lillian Guevara-Castro

Lillian brings more than 30 years of editing and journalism experience, having written and edited for major news organizations, including The Atlanta Journal-Constitution and the New York Times. A former business writer and business desk editor, Lillian ensures all BadCredit.org content equips readers with financial literacy.

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Reviewed by: Ashley Dull

Ashley Dull

Ashley has managed content initiatives for BadCredit since 2015, having worked closely with the world’s largest banks and financial institutions, as well as press and news outlets, to publish comprehensive content. Her credit card commentary is featured on national media outlets, including CNBC, MarketWatch, Investopedia, and Reader's Digest.

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More About LendingTree

LendingTree Review: Auto Loans as Soon as Tomorrow
Expert's Take

LendingTree Review: Auto Loans as Soon as Tomorrow

By: Jon McDonald

The LendingTree network can send you up to five car loan proposals within minutes. Each offer will specify a unique down payment requirement, loan amount, interest rate, and monthly payment.

You can pursue any of these offers and complete the application process on the same day. In fact, you may be able to close on your loan within 24 hours of submitting your finance application form.

You get multiple offers because LendingTree doesn’t originate loans. Instead, it distributes your loan request to a network of direct lenders competing for your business. There is no charge for LendingTree’s service, and you’re under no obligation to accept an offer for a car loan.

LendingTree receives compensation from the companies on its site, which affects how and where offers appear. LendingTree does not include every potential lender or loan option available in the marketplace.

Compensation does not affect the opinions expressed in this LendingTree review.

Types of Vehicle Loans Offered

LendingTree’s lender-matching service covers three types of car loans: purchase, refinancing, and lease buyout.

Purchase

You don’t have to settle for dealership financing if you’re in the market for a new or used vehicle. LendingTree has a better idea: Add competition from an independent lender, bank, or credit union, and let the best offer win.

The vehicle you want to buy serves as collateral for a loan. That’s both good and bad:

  • Good: You don’t need a high credit score to get the loan. The loan provider is more willing to work with you because the car secures the debt.
  • Bad: The lender will repossess your vehicle if you default on the loan.

LendingTree can get you multiple loan offers with varying interest rates (i.e., annual percentage rates, or APRs). By comparing the different APRs in each offer, you can ensure you’re getting a competitive rate.

Lenders consider several factors to determine the APRs on their loan offers, including your credit score, the vehicle you want to buy, the loan amount, and the repayment term (typically two to seven years). Having a better credit score qualifies you for a lower interest rate.

Average Auto Loan Rates

If you have poor credit, you can increase the likelihood of loan approval by making a relatively large down payment. Conventional wisdom calls for a 20% down payment on a new car and 10% on a used one.

But you may have to pay 25% or more to overcome a poor credit score. A larger down payment may qualify you for a lower interest rate.

If you are trading in your current car, you can apply the allowance to your down payment. Alternatively, you can privately sell your current vehicle and use the proceeds however you want.

Your loan amount reflects the car’s negotiated price minus the down payment. Extra closing costs, such as an origination fee, may apply. You may pay some fees upfront and roll others into the loan. Paying fees upfront means they won’t accrue interest over the loan term.

If you have bad credit, a loan provider may ask you to buy credit insurance to repay the debt should you die or become disabled.

Before purchasing this insurance, consider its cost and whether you have other policies that offer the same benefit. The loan APR will reflect the additional cost of credit insurance. Credit union loans seldom require credit insurance, even if you have bad credit.

Car loan APRs charge simple interest (i.e., not compounded). The total interest depends on the loan’s APR and term. Longer loan terms cost more and sometimes require a higher APR.

While overall cost is essential, your loan’s monthly payments must be affordable. You can lower the monthly charge by expanding the loan term, selecting a less costly vehicle, or increasing your down payment.

Comparing independent loan offers gives you a stronger bargaining position at your car dealership. You’ll know the offer is fair if the dealer can’t beat it.

Refinancing

You can refinance your car by taking out a new loan to replace the existing one. The new auto refinance loan may have a different term, APR, and/or monthly payment. Reasons to refinance your vehicle include:

  • Reducing your monthly payments: You can save money each month by extending the loan term, reducing the loan amount, or negotiating a lower interest rate. For example, you can use an employment bonus to pay down part of your remaining loan balance and apply the rest to an auto refinance loan.
  • Pay less interest: If you can obtain a lower APR without extending the loan term, you’ll save on the overall cost of the loan. You may snag a lower APR if prevailing interest rates decline or if you achieve a good credit score. Be wary of any fees that reduce the savings from a lower APR.
  • Cash out your accumulated equity: You can refinance an amount larger than your current loan balance based on your equity (i.e., the vehicle’s current value minus the amount you owe). You then split the new loan’s proceeds by repaying the existing balance and pocketing the rest.

It shouldn’t cost you much, if anything, to refinance a car loan if your current one doesn’t charge a prepayment fee and your new one waives closing costs. You may have to pay a nominal fee to change the lienholder on the vehicle’s title.

The lender may offer financial product options such as an extended warranty or guaranteed auto protection. GAP is an insurance policy that helps you pay off your loan if you total your car, someone steals it, or it’s worth less than your loan balance. GAP pays any shortfall when your primary insurance doesn’t cover your remaining loan balance.

Lease Buyout Loan

A lease buyout is a way to purchase a car when the lease expires. The lease agreement sets the purchase price (equal to the car’s residual value). Alternatively, you can simply turn in the vehicle at the end of the lease, pay any fees, and walk away.

A third possibility is trading in the vehicle and immediately purchasing or leasing another car. If the leased vehicle is worth more than its residual value, the dealer will likely credit some of the surplus to your new vehicle.

If you decide to buy out the lease and don’t want to pay cash, you can shop for financing on LendingTree. Typically, you arrange the buyout with about a month left in the lease, as most loan offers are good for 30 days.

A lease buyout makes sense if the car is worth more than its residual value. A buyout can also be advantageous if you face stiff turn-in fees, but the vehicle still meets your needs.

How to Apply

Arranging a loan through LendingTree is as simple as 1-2-3:

  1. Complete a loan request form: It takes only a minute or two to answer a few simple questions.
  2. Compare lenders: LendingTree prequalifies your loan request and finds up to five offers for you to compare.
  3. Apply for a loan: Fill out an application for the loan offer that best fits your needs. You should receive an immediate decision.

If the lender approves your application, you’ll have about a month to sign the loan agreement and collect your money. This interval gives you enough time to negotiate a better deal with your car dealer, if possible.

Is LendingTree Legitimate?

Founded in 1996, LendingTree proclaims itself to be “America’s largest lender marketplace,” which speaks well of its legitimacy. The company has Better Business Bureau accreditation and a BBB rating of A+. Trustpilot gives it an Excellent rating of 4.6 out of 5 and reprints several customer reviews praising the company’s customer service.

The LendingTree website displays the logo for Comodo, a threat prevention platform. It also publishes a Vulnerability Disclosure Policy explaining the company’s defense strategy for protecting customer data from online threats.

Keep in mind that LendingTree only finds lenders. You need to be careful that the direct lenders are legitimate. Start by checking their BBB status and Trustpilot ratings.

You can also contact your state’s attorney general to confirm a lender has a license.

Does LendingTree Protect Your Privacy?

The published LendingTree Privacy Policy describes the data it shares and with whom it shares it. You have only partial control over data sharing.

The personal information LendingTree collects and shares includes your:

  • Contact details and demographic information
  • Social Security number and account transactions
  • Credit history and credit scores
  • Transaction history and credit products rates and payments

You CANNOT control data sharing for:

  • Everyday business purposes
  • Marketing purposes
  • Joint marketing with other financial companies
  • Affiliates’ everyday business purposes regarding information about your transactions and experiences

You CAN control data sharing for:

  • Affiliates’ everyday business purposes regarding information about your creditworthiness
  • Affiliates to market to you
  • Nonaffiliates to market to you

You may have more rights if you live in California and certain other states.

The policy describes how to block cookies and advertising IDs on your browser and mobile devices.

LendingTree uses encryption and firewalls to protect data. The company states, “Transmissions between LendingTree, banks, lenders, loan brokers, and real estate professionals (and affiliates) are encrypted using public-key cryptography algorithms with a minimum key size of 128 bits.”

It deploys sophisticated firewalls to protect itself from internal and external threats.

Does LendingTree Hurt Your Credit?

Most creditors issue a hard credit inquiry to at least one major credit bureau when you apply for a loan or credit account.

Each credit bureau (Experian, Equifax, and TransUnion) maintains borrower credit files and publishes credit reports and scores. A hard inquiry remains on your credit report for two years and can reduce your credit score by a few points for up to one year.

LendingTree does not perform a hard credit inquiry when you submit a loan request, but its direct lenders do. You will only suffer a hard pull of your credit report if you apply for a loan.

If you are loan shopping, credit scoring models count multiple different lender inquiries made within a certain period as a single inquiry.

What Other Types of Loans Does LendingTree Offer?

LendingTree auto loans are but one type of lending the company arranges. Other LendingTree loans include:

  • Home Loans: LendingTree can find you a home loan for purchasing or refinancing a residence. It can also help you find a home equity loan or a reverse mortgage home loan.
  • Personal Loans: You can receive up to five offers using the LendingTree loans network. The loans may be secured or unsecured, and you can use the proceeds for any purpose, including credit card refinancing, debt consolidation, home improvement, and other significant expenses.
  • Student Loans: LendingTree can help you refinance your existing federal and private student loans, and you may quickly receive student loan offers from multiple lenders. You will not want to refinance your federal student loans with a different lender if you plan to enroll in a federal loan forgiveness program since refinancing these loans disqualifies your participation.
  • Small Business Loans: LendingTree can get you multiple small business loan offers if you run a sole proprietorship, partnership, limited liability company, S corporation, or C corporation. You can use these loans for payroll, equipment, real estate, or nearly any need. Loan amounts range from $5,000 to $500,000+ and usually close within two weeks. The loan offers typically have lenient requirements regarding how long you’ve been in business and your personal credit scores, meaning you don’t necessarily need a good credit score to qualify.

LendingTree can provide additional financial product and service options, such as free credit scores, banking products, and various types of insurance, including car insurance. It takes only a few minutes to use the LendingTree QuoteWizard and receive multiple car insurance quotes.

LendingTree Auto Loan Review: A Legitimate Lending Network That Gets Fast Results

This LendingTree auto loan review should prove helpful to consumers who want to explore each loan option. The lender-matching site can help a borrower find almost every kind of vehicle loan, whether to purchase a car, refinance it, or buy out its lease.

According to many customer reviews, the company provides excellent customer service. It generates thousands of transactions each month.

Before accepting any LendingTree auto loans, make sure you understand all the loan terms and rates. A potential lender must give you documentation laying out all the essential information about your loan, and it’s all too easy to sign agreements without reading them first. It’s not exactly fun, but taking the time to know what you’re signing can save you much grief later.

Other Auto Loans Ratings

  • Network of dealer partners has closed $1 billion in bad credit auto loans
  • Specializes in bad credit, no credit, bankruptcy and repossession
  • In business since 1999
  • Easy, 30-second pre-qualification form
  • Bad credit applicants must have $1500/month income to qualify
  • Click here for application, terms, and details.
★★★★★

4.9

Overall Rating

Interest Rate In Business Since Application Length Reputation Score
3.99% - 29.99% 1999 3 minutes 9.5/10
  • Free, no-obligation application
  • Specializes in auto loans for bankruptcy, bad credit, first-time buyer, and subprime
  • Affordable payments and no application fees
  • Same-day approval available
  • Connects 1000's of car buyers a day with auto financing
  • Click here for application, terms, and details.
★★★★★

4.5

Overall Rating

Interest Rate In Business Since Application Length Reputation Score
Varies 1994 3 minutes 9.0/10
See All Auto Loans »

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About the Reviewer

Jon McDonald

With more than 15 years of journalism expertise, Jon McDonald stays up to date on emerging finance trends and news about the companies impacting the industry. He is most knowledgeable in the areas of budgeting, loans, and responsible credit use and is committed to bringing that experience to readers around the world. He has a passion for both writing and editing, and his articles have appeared in publications produced by The New York Times.

Information Warranty & Disclosure: Great efforts are made to maintain reliable data on all offers presented. However, users should check each provider’s official website for updated terms, details and conditions for each offer before applying or signing up. Our site maintains strict terms of service and may accept compensation for paid ads or sponsored placements in accordance with these terms. Users must be at least 18 years of age to be eligible for financial offers as per the terms presented on provider websites.

* FICO scores/credit scores are used to represent the creditworthiness of a person and may be one indicator to the credit type you are eligible for. However, credit score alone does not guarantee or imply approval for any financial product.