When you’re not sure which lender to pick, a side-by-side comparison can help guide your choice.
A huge part of the lending process is comparing lenders — after all, it can make an impact on how much you borrow and how much your loan costs. LendingClub and LendingTree are two different services that can get you funding when you need it, but before you dive into either, you’ll want to make sure you know how each works.
|Widest lending limits||Tie||Tie|
LendingTree won three out of five categories. Is this legit?Yes. Our analysis is based on both providers’ stated APR ranges, loan amounts and listed fees. Reputation is judged from an outside source that gathers user reviews. However, LendingTree is a loan-connection service whereas LendingClub is a peer-to-peer lender. LendingTree’s advertised benefits may not apply to you if you don’t qualify for a specific lender’s terms after you’re connected.
An overview of LendingClub and LendingTree
Despite the similar names, LendingClub and LendingTree aren’t the same company. In fact they’re completely unrelated and offer financing in different ways.
How they’re different
The main difference is that LendingClub is a peer-to-peer lender, while LendingTree is an online lending marketplace. This means that LendingClub relies on investors to fund your loan while LendingTree can help you prequalify for multiple lenders with one application.
However, the rates you get through LendingTree can widely vary depending on which lender you go with. LendingClub rates your creditworthiness using a unique grade system that impacts your origination fee.
How they’re similar
Both lenders have been around for a while — though LendingTree, founded in 1996, has a decade on LendingClub.
Both also allow you to apply with a cosigner to get a better rate or help meet eligibility requirements.
What are the eligibility requirements?
- Have a credit score of at least 660
- Have a steady source of income
- Be a citizen or permanent resident of the US
- Not a resident of Iowa or West Virginia
- Have a steady source of income
- Be a citizen or permanent resident of the US
Other requirements vary by lender, but provided you have decent credit and meet these two criteria, LendingTree may be able to connect you with a lender.
Which offers lower interest rates?
When you apply, LendingClub assigns your application a “Loan Grade” of A1 to G5 based on your credit that it uses to determine your APR and origination fee. Because of this, LendingClub’s APR ranges from 6.95% to 35.89%.
Because LendingTree aggregates loans from many different companies, it doesn’t advertise a set APR range. Its network of providers is extensive — with LendingClub included in the mix — so you’ll have to see which provider you’re matched with to know your potential APR.
LendingTree has LendingClub within its network, which means you could potentially have the same APR. And because there are other providers within LendingTree’s network, you also have the opportunity to receive a lower APR than those provided by LendingClub.
Which comes with fewer fees?
LendingClub has a wide range of fees that may apply to your loan. At the base, it has an origination fee between 1% to 6% based on your loan grade. If you’re more than 15 days late on a payment, you’ll be charged either 5% of the amount due or $15, whichever is greater. And if you choose to pay by check, you’ll face another $7 processing fee.
LendingTree doesn’t charge a fee to use its service. However, the lenders in its network may have a variety of fees. You may be stuck paying more fees than with LendingClub, or you might not have to pay any fees at all.
LendingTree has lenders in its network that don’t charge an origination fee or high late fees. But you might be connected with a lender that does.
Hugo looks to expand his homePicture this scenario. Hugo and his son have just adopted a fairly large Saint Bernard. With the new addition to the family, Hugo finds that his current space doesn’t quite fit his needs.
Luckily, Hugo already planned renovations to open up his house a little more. To take out a non-load-bearing wall, it’s going to cost Hugo about $3,000. Since Hugo has to get a loan for the home renovation, he decides to look into LendingClub and LendingTree.
|APR||Fees||Ease of application|
|LendingClub||6.95%-35.89%||An origination fee of $30 to $180, depending on loan grade||Application takes a few minutes to complete, but you can also check your rates without affecting your credit.|
|LendingTree||Varies by lender||Varies by lender||A simple application can get you up to five offers from different lenders.|
Hugo reviews the facts and decides to go with LendingTree, since LendingClub is part of LendingTree’s network. This way, he has a chance of getting LendingTree’s decent rates while also having the ability to compare it against other lenders that might offer a better deal.
Which has a better reputation?
LendingClub has mixed reviews as of December 2018, but many are negative. Only 14 people have left a review on Trustpilot. Half rate it with five stars while the other half gives it one star, leaving LendingClub with a solidly mid-range score of 5.3 out of 10. And while it’s accredited by the Better Business Bureau (BBB), It has a B rating and the majority of its reviews are negative.
With over 6,500 reviews, LendingTree holds an excellent score of 9.1 out of 10 on Trustpilot. But unlike LendingClub, it isn’t accredited by the BBB. It still has an A- and more intermediate reviews, but because there are so many, you might have some trouble sifting through to find the places LendingTree really shines and the places it falls short.
LendingTree has a significantly higher review presence than LendingClub. The higher rating from those reviews also helps LendingTree surpass LendingClub for this category.
How much can I borrow with each lender?
LendingClub offers personal loans from $1,000 to $40,000 to its borrowers.
With 46 lenders offering personal loans in its network, LendingTree offers a broad variation of minimum and maximum terms.
While LendingTree has a network of lenders that can offer large personal loans that surpass LendingClub’s maximum limit, there’s no guarantee that you’ll be paired with one of those lenders. In this case, it may be better to apply with both to see what kind of preapproval offer you receive.
Which lender can get me money faster?
You can complete the application in just a few minutes and receive funding in as little as a few business days.
LendingTree claims that it can get you the funding you need in as little as 24 hours, but you have to qualify.
LendingTree’s marketed 24-hour turnaround time is hard to beat, but that’s not a guaranteed funding speed. Most borrowers probably won’t be connected with an eligible lender that can process an application and provide funds the next day. And since LendingClub’s turnaround time of just a few business days is shorter than most competing direct lenders, you may actually get your money faster through it.
Bonus round: Which lender offers risk-free quotes?
LendingClub allows borrowers to check which rates, terms and loan amounts they might qualify based on a soft credit pull, which won’t affect your credit score. However, if you continue with your application, LendingClub will eventually conduct a hard credit inquiry that may impact your credit.
LendingTree also allows borrowers to prequalify with multiple lenders based on a soft credit pull that has no affect on your credit score. And while LendingTree never conducts a hard credit check itself, your lender likely will if you continue with your application.
Both LendingClub and LendingTree offer ways to find out which rates you might be eligible for without hurting your personal credit score.
What other types of loans do these lenders offer?
Both of these lenders offers several financing options in addition to personal loans.
At the end of the day, there are many similarities between LendingClub and LendingTree. As a direct lender, LendingClub has a fair system for breaking down APR qualification and origination fees. It can be a good choice if you’re looking to work with one company for the duration of your loan.
If you want to shop around without having to compare lenders and complete multiple applications, LendingTree might be a better solution. However, although LendingTree includes more than 40 personal loan lenders in its network, it only shows you offers from a maximum of five of those lenders. This can limit your results, meaning you may not get the best deal.
Before you borrow, learn more about how peer-to-peer lending works and take a look at other personal loan connection services so you can be sure you’re getting the best available deal on your next loan.
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