LendingTree vs Lending Club
LendingTree and Lending Club are two of the most popular FinTech startups to have launched in the US and have revolutionised how consumers and businesses acquire finance. Given their sheer scale – these two lenders are now listed on the NASDAQ and NYSE respectively – we felt we simply had to do a LendingTree vs Lending Club comparison. Once you start to learn more around each business you’ll see it’s not so much a straight up LendingTree vs Lending Club comparison as each of these companies brings something unique to the online business loan market.
LendingTree vs Lending Club – Quick Comparison
|Loan Amount||$1,000+||$5,000 – $500,000|
|Loan Term||1 month – 25 years||6 months – 5 years|
|Unsecured Loans||Yes, through SOME providers on the LendingTree platform.||Yes, when business loan is under $100,000|
|Client Reviews||95% Positive||98% Positive|
|Response Time||Same day.||Same day.|
|Sign-up Time:||Intuitive and easy but expect to fill further details once you’ve found your match.||Easy and fast, four simple steps.|
|General Feedback from Clients Online:||4.5 / 5 on TrustPilot from over 8,200 reviews. Unanimously praised for being quick and easy.||4.8 / 5 on TrustPilot with over 1,000 reviews. Consistently praised for speed and convenience.|
LendingTree vs Lending Club – The Tale of Two Online Lending Marketplaces
LendingTree is a lending giant. Established in 1996, it’s now helped millions of borrowers compare lending options and attain finance. Having gone public in 2015, LendingTree has enjoyed 5 successive years of share price growth and has a market cap of over $4 billion. More information is available in our full LendingTree Review here.
Lending Club was a truly social concept in its original formation. Founded in 2006, it originally launched as a Facebook group that worked on a P2P basis connecting borrowers and lenders. Having enjoyed significant growth, Lending Club has forgoed some of its fundamental P2P principles but the platform still allows for smaller investors. You can read our full Lending Club Review here.
Both LendingTree and Lending Club advertise themselves as an online lending marketplace, but the two firms go about this in a rather different way. The original concept behind Lending Club was to operate as a P2P lending marketplace, seeking to attract both borrowers and individual investors. Even doing this via a Facebook group in its early days. The Lending Club tech would then match borrowers with suitable investors in order to facilitate financing. Investors are able to determine their own risk/return profile so LendingClub knows exactly which capital it can access when required. Due to demand, Lending Club has become less reliant on P2P matchmaking and has larger investment partners it can turn to for capital. Since 2019, it no longer offers P2P business loans. Instead, business clients are recommended to one of Lending Club’s partners – more akin to the LendingTree model.
LendingTree doesn’t seek to generate its own capital for lending, it simply compares the market for the best offers and presents a number of lending options to customers from its lending partners. Should a user receive a loan from one of LendingTree’s partners via their platform, LendingTree receives a fee. LendingTree removes the hassle of approaching a number of individual lenders on your own. It can save a lot of time for businesses who require finance fast. This drive to make financing easier has been in place since the founder and CEO Doug Lebda encountered his own difficulties when seeking his first mortgage in the 90’s. Through LendingTree business can access a number of lending solutions including; business loans, invoice finance and credit lines.
- LendingTree sets no minimum requirements as it is not a lender in itself.
- LendingTree’s partners are some of America’s largest online business loan companies, including OnDeck and FundBox.
- Typical minimum requirements for an online lender are in line with LendingClub.
- 12 months or more as a registered business
- Minimum $50,000 in annual revenue
- No recent bankruptcies or tax liens
- You own above 20% of the business and have at least fair or better personal credit
LendingTree vs Lending Club Pricing
Pricing through LendingTree will ultimately depend on the prices set by their partners but having multiple options in one place should be of benefit to the borrower. The type of finance you’re seeking will have a big impact on rates as well. Short term unsecured loans will attract a higher rate of interest than SBA loans for instance.
Lending Club charges a higher origination fee than most online lenders, but generally has favorable interest rates. Lending Club’s terms are offered as interest rates, as opposed to a factor rate, which has become common for short-term loans. If you think you might be in a position to pay your business loan early then Lending Club may be preferable.
LendingTree vs Lending Club Products
As LendingTree connects you with a plethora of different loan companies, the products available via LendingTree will inevitably eclipse that of Lending Club. It’s important to remember LendingTree doesn’t provide any of these loan products themselves.
Lending Options with Lending Club
- Unsecured Business Loans, under $100,000
- Secured Business Loans $100,000 – $500,000
LendingTree vs Lending Club: Which do Clients Prefer?
Seeing as we’re talking about two of the largest lending marketplaces in the US there are plenty of online reviews to be found online for both Lending Tree and Lending Club. Comparing the two, you can actually see many of the same benefits enjoyed by clients across both lending marketplaces.The ultimate sentiment seems to be the same – users have had a quick and (by financing standards) painless experience.
Over 8,250 Reviews on TrustPilot
Overall Trust Score 4.4 / 5
|Lending Club Reviews
Over 1,100 Reviews on TrustPilot
Overall Trust Score 4.8 / 5
Lending Club has a better overall score, but has a smaller number of reviews when compared to LendingTree. Lending Club has just 4% of reviews which report a negative experience, whilst LendingTree has just 5% of users reporting a negative experience. In both cases, the number of positive reviews far outweigh the number of negative reviews. It must be noted that it’s difficult to separate the reviews left by corporate customers with the reviews left by private customers.
Overall, what we can see here is that users really appreciate the service by Lending Club and on the whole by Lending Tree too. When applying for a loan through Lending Tree remember you will ultimately be dependent on their partners capabilities offering you finance.
LendingTree vs Lending Club: Our Take
Both of these US success stories have played their part in shaking up a traditionally outdated and slow moving finance industry. No matter which marketplace you choose, you can expect to have a lending decision made fast. For businesses seeking a small business loan of up to $500,000 then Lending Club is an easy solution, especially businesses seeking under $100,000 as you can get this on an unsecured basis. For businesses seeking a wider variety of solutions, or are perhaps still unsure of the types of financing available to them, then LendingTree is a great place to start.