Are online Lenders reliable?

15 years ago

I would like to use an online lender via LendingTree because the rate is much better. In fact, the monthly payment for the Lending Tree 30-year-fixed loan is the same as the interest-only loan from a traditional lender! What are the risks associated with an online lender and how can I reduce the chance of something going wrong? For instance, I would like some way of insuring that the online lender would not back out at the last minute.

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Comments (5)

Mimou-GW
15 years ago
We used Lending Tree through the Costco website (got a $300 or $400 Costco gift card as part of the deal). I was a little worried but the rate was better than anywhere else and the closing costs that are determined by the lender were fixed and upfront. I kept in contact with them through phone calls and email. The lender was in a different time zone which caused a small problem when I really needed some information late in the day and the office was already closed but other than that things went smoothly and everything was as promised. My transaction took place before all the mortgage mess started.
kailuamom
15 years ago
Lending tree is a lead generation site, lenders pay a fee to bid on your loan. They may have some quality controls on their lenders, but the lenders are all different. There are both good and bad stories about lending tree lenders. I used a lending tree lender (First Houston) and got an outstanding loan. Further, they understood how to manage the process with different parties in different places, so they were a great fit for me. (DH travels for a living, so I needed to manage this with him in a different state every day!). That said, I would reccomend doing your own due dilligance on the lender you are looking at.
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sparksals
15 years ago
We've used Lending tree a couple times with no problems. However, I just got a letter in the mail the other day from them stating that there was a breach in their security from 2006-2008 (or thereabouts) where disgruntled former employees shared private passwords with certain lenders who accessed the LT system to get client's private information. They don't believe there was any ID theft, the mortgage lenders wanted the info to contact the clients themselves. They have since beefed up security.
bushleague
15 years ago
I used Lending tree years ago and got hooked up with this guy in VA, whom I've done several deals with since. I'm looking at two deals presently, and used Zillows new mortgage site. I found a guy in Providence with great rates, and only $980 in fees to close.
theresafic
15 years ago
I refinanced my house with a S&L account I've had for several years. I never use it because it is in a different state and there are no branches in my state. However, I got a great rate and really trusted the institution. I've had no problems. It all went smoothly and I've had my mortgage with them for ~ 3 years now.