Finance

Dec 2 2016

LendingTree Home Equity Loan Review 2016 – Top Ten Reviews #mortgage #rate


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LendingTree Review

If you are looking for a loan and wish to borrow against the existing equity in your home, LendingTree is a good place to start. While other companies can make you an offer directly, LendingTree connects you with banks from its network of more than 300 lenders. This extensive selection means you can shop through multiple offers and choose the one that best fits your financial situation.

Rates & Fees

There are many factors involved that determine the loan amount you qualify for as well as the interest rate and fees associated with your loan. Having a broker like LendingTree do the legwork and find companies you qualify for can save you valuable time. It has lenders that accept a FICO score as low as 580, the minimum credit score needed to get a mortgage and which is a significantly lower score than what most banks advertise they are willing to accept. In situations like the above, LendingTree’s process can save hours of time and frustration.

Loan-to-value ratio (LTV) is a consideration companies look at, and most companies prefer an LTV of 80 percent or lower, which is in line with what LendingTree prefers, though its lenders may accept a higher percentage. The debt-to-income (DTI) ratio is another factor lenders consider, and 36 percent is generally the maximum at which most companies feel comfortable approving a loan. But again, like with LTV, LendingTree likely has lenders who might accept a higher ratio depending on other factors.

Eligibility

When choosing an equity loan, you have the choice of a traditional loan where you receive a lump sum or a home equity line of credit (HELOC), which you can withdraw from over a period of time. LendingTree has lenders who offer both types of equity loans. The minimum loan amount is $25,000 with both loan types. Depending on the purpose of your loan, this may be more than you need. Keep in mind, however, that the average home equity loan is $30,000. With a HELOC loan, again, depending on the lender, you do not have to max out the line of credit. The maximum loan amount is $400,000.

The maximum loan term is 30 years, which is the average length of time for a typical first mortgage. Depending on your loan requirements, you may have a 15-year or even a five-year loan. Your HELOC draw period the time during which you can freely withdraw against your line of credit ranges between five and 10 years and depends on the lender you choose.

Loan Requirements

When we contacted LendingTree, we spoke with representatives who were able to answer questions about its borrowing process and the information needed to process an application. Because so much information depends specifically on the lender, representatives could not provide us with exact numbers for loan amounts and rates and fees, so you may not have some of your most basic questions answered. But the representatives we spoke with were friendly and willing to answer the questions they could.

The loan process with LendingTree takes you through the pre-qualification process. It gathers your basic information, including your income and assets as well as your existing debts, and then connects you with multiple loan offers. The underwriting time frame varies, but most companies take between three and five weeks to complete a loan request. Again, the time it takes the lender to process your loan varies depending on whom you choose. There are no local branches where you can physically speak with a representative, but LendingTree has lenders in all 50 states and in Washington, DC.

Customer Experience

When it comes to a loan, especially one with a term of 15 or 30 years, your final interest rate, as well as closing costs and additional fees, can have an enormous impact on your loan. Your interest rate is influenced largely by your FICO score and employment history. Because LendingTree acts as a broker, you can shop through multiple offers, so you don’t feel pressured or locked into having to accept a loan with a higher interest rate or fees than what you’re comfortable with.

In the best-case scenario, you can also find lenders that have minimal fees as well. Many of LendingTree’s lenders do not charge application or closing fees, which can save you a lot during the loan process. Some companies charge a yearly maintenance fee, but most of the lenders you’ll receive offers from do not. And if you wish to pay off your loan early, there will likely be no fee. However, because each lender works differently, you will want to understand what, if any fees, will be associated with your loan.

As a broker, LendingTree gives you more options than if you were to seek out and compare loan offers from standard lenders yourself. In addition, you have a better chance of pre-qualifying because lending requirements vary depending on the provider. Although your final interest rate depends on a number of factors, LendingTree features companies with some of the lowest rates and fees in the industry. In the end, more choices means you are more likely to receive a loan with rates and terms you can handle and that you’re satisfied with, making LendingTree one of the best choices for a home equity loan or HELOC.


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