How LendingTree and Mortgage Marketplaces are Saving Home-Buyers Money
The old mortgage model is slowly disappearing, and for borrowers that’s a good thing.
The legwork involved in rate-shopping for a mortgage used to be daunting. Lenders had all of the power, with a process that involves a mountain of paperwork and no easy way to compare rates and terms from different lenders.
But mortgage marketplaces have changed all of that.
They put the power in the hands of borrowers, making the entire process more streamlined and transparent and allowing borrowers to rate-shop without ever having to step into a bank.
Marketplaces, such as LendingTree, have lenders compete for borrowers, forcing lenders to lower their fees and offer more flexible terms.
In this race to improve the customer experience, LendingTree stands out as the biggest and most well-known marketplace in the industry, with a network of over 350 lenders.
LendingTree offers borrowers the added advantage of connecting to reputable non-banks (credit unions and online lenders) which are more lenient with their approval process, more agile and can offer terms that banks simply can’t offer because they don’t face the same regulatory rules as banks.
Non-banks have eaten up so much market share that they now originate about 60% of all home loans - and that number is only rising.
Having more options and easier access to non-banks isn’t the only advantage of using a mortgage marketplace:
According to new research from Freddie Mac, the average borrower could save $1,500 by getting just one extra rate quote. That number rises to $3,000 by getting five quotes.
There’s another reason it pays to shop around.
By comparing lenders, you’ll see variations in lender origination fees, points, mortgage insurance premiums and third-party fees. You’ll also get a sense of how long it takes lenders to close a loan, how well they communicate and their customer service reviews.
If you’re ready to shop around, start with LendingTree and be sure that when you sign for your mortgage you really are getting the best deal.