Daily News and Information for the Professional Real Estate Agent
LendingTree Sued For False Advertising and Unfair Business Practices
Thursday, October 19, 2006
- By Staff Writer, National Realty News
STUART, FL - Everyone’s heard the tag line – “When lenders compete, you win.” A recent class action suit filed in Orange County, California Superior Court alleges that LendingTree diverts LendingTree.com leads to its subsidiary, which conducts business under the name LendingTree Loans without any competition.
The suit further claims that loans originated by LendingTree Loans are originated at inflated prices, based on the false representation that competition for the business has occurred among lenders.
When we contacted LendingTree about the allegations LendingTree spokeswoman Rebecca Anderson said, “LendingTree provides consumers with multiple loan offers from either retail or wholesale lenders, and we experience customer satisfaction of over 90%. The suit is without merit and LendingTree intends to defend against it vigorously.”
Anderson went on to explain, since the introduction of LendingTree Loans, consumers now have two potential paths when using the LendingTree website, the retail lender network and the wholesale lender network.
The retail lender network operates the traditional LendingTree model that allows four lenders to make offers directly to the consumer.Alternatively, the wholesale lender network offers consumers a choice of several investors represented by LendingTree Loans, much in the same way a broker would shop a loan for a consumer. “We provide [the] appropriate disclosures throughout the loan process,” Anderson added.
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