Has anyone tried using LendingTree.com to get miles for a Mortgage or Real Estate Agent transaction? If so, how was the experience? A couple of my friends have tried it and said it is well worth it, especially to use a Real Estate Agent. Any thoughts????

I've used lending tree to refinance twice.

It's easy and rates were comparable or better than others.

And the second time, I got 22k UA miles. It works. I'd do it again, but I doubt rates will ever drop lower than what i got 2 months ago.

Used it to refinance two and a half years ago, it worked like a charm -- I got three or four good overs, did the whole deal by email and fax, and got 30,000 DL Skymiles out of it. I'd absolutely do it again.

Thanks for your help!!

I used them once, received one offer from e*trade financial and was stupified to find the e*trade commission paid to lendingtree.com as part of my closing costs.

That's rediculous and not worth the miles! In such a case, why didn't you just make beeline direct to etrade and cut lendingtree completely out of the picture?

I know I'm covering some old ground here, but I strongly suspect that the deal you get at Lending Tree isn't as good if you are getting miles for the transaction. A year or two ago, I tried to scientifically prove this by simultaneously entering two similar loan requests, one directly through Lending Tree (no miles), and then one through the Northwest Airlines gateway to Lending Tree, but the system caught me and nullified the second request.

As I recall, this has been discussed before, with strong opinions on both sides but little evidence on either. It would be a very interesting experiment if two independent FlyerTalk members with similar credit ratings and located in the same state applied for similar loans, one with the miles and one without. I'd love to know what resulted. But in the meantime, my gut feeling is that you pay for your own miles on Lending Tree, and in my past transactions with them, I've foregone (forewent?) the miles.

We got miles for our home purchase, but the agent said he would have given us a cut of his commission instead, which would have been worth more.

QL

I have an ownership interest in a miles-for-mortgage program that is competitive to lendingtree, so I will tread carefully and not make any commercial statements here, but suffice to say, LendingTree's mileage rates are generally higher than rates or programs available without miles - also when using LendingTree, pay close and careful attention to the ratings of the proposed lenders before exchanging information with them...those ratings, although not always a guaranteed indication of the quality of service you will receive, are a good way to filter out lenders/brokers who can turn your transaction into a nightmare. I know a few folks who learned that lesson the hard way.

When running the numbers, always factor in the length of time you plan on keeping the loan. A shorter timeframe will minimize the total impact of a higher rate, which balances against the value of the incentive - a longer timeframe will cost you alot more in interest than the value of the incentive you are receiving.

Read the terms and conditions of LendingTree's program to understand how they make their money, and then you can figure out that the cost of the miles has to be padded in the rate or fees somehow. Remember, nothing is for free.

I actually have an interest in LendingTree...I have a fairly strong interest since I am an employee. In speaking with one of the moderators, we agreed that I may be able to provide some insight into the program.

In response to the previous statement by bocastephen, I agree that you need to factor in the length of time in determining the value of miles you will receive versus the overall value of the loan. However, I don't think that a person should sacrifice their interest rate in favor of mileage, except in exceptional situations. (Maybe you will only be in the home for a few years and you could really use the extra plane ticket). The number of customers seeking shorter term or adjustable rate mortgages is definitely growing as more and more homeowners learn about the process and the large amount of money which can be saved if the loan program fits their needs.

In response to many other postings throughout the FlyerTalk Forums, the rates and fees received by customers associated with the airline partners should be no higher than a regular LendingTree customer for a couple of reasons:

-in many cases, Lenders are not aware that the customer is even affiliated with an airline program. They may not find out that the customer is due miles until after the closing.
-the cost of any and all miles which are given to a customer through LendingTree is paid by LendingTree, not the Lender or Real Estate agent. LendingTree does not pass these costs on to Lenders and therefore, Lenders have no reason to pass any additional costs on to the consumer.
-The same lenders are used for LendingTree requests and requests associated with an airline.

Thanks for taking the time to read this. As I mentioned at the beginning of this post, I am not here to sell you on LendingTree-just wanted to clear up any misconceptions about the program. If you have any questions, let me know. Sorry this post ended up so looooong.

Eric

I hate to keep going back to this, but let me quote from the lendingtree disclosure (the California good faith estimate addendum):

GFE ADDENDUM
DISCLOSURE AND FEE ACKNOWLEDGMENT

I/we understand that as compensation for its services as a mortgage broker, LendingTree will receive a mortgage broker fee of up to $925 from the Lender upon the closing of my loan. The actual amount of LendingTree�s fee is disclosed on the Good Faith Estimate you will receive from the Lender after your loan application is submitted. This is the total compensation LendingTree will receive from the Lender for its services and is paid by the lender. The Lender includes the fee that the Lender pays to LendingTree in your interest rate, points, fees and terms of the loan. I/we acknowledge that this mortgage broker fee will be paid to LendingTree outside of closing and that there is no other mortgage broker fee agreement between us.

LendingTree does not make mortgage loans or commitments.

LendingTree is a Licensed Real Estate Broker, CA Dept. of Real Estate, (916) 227-0931, License No. 01230150

now buying these travel awards is a fairly expensive proposition. If lendingtree is earning only $925, I would consider it almost impossible for a profit to be made once the cost of the incentive is deducted. This would lead me to believe that while the disclosed broker fee is only $925, there is probably a fair amount of yield spread built into the quoted rates, hence the assumption of a rate somewhat higher than the absolutely lowest available rate. It is probably the yield spread that is being used to pay the lendingtree broker fee and the travel award. So, true, you can say that the rate for a loan with travel awards might be the same as a loan without, I would propose that the loan rate from a competent, skilled broker mined from a variety of wholesale sources could be lower than lendingtree's rates.

That is a good point. Actually, Lenders in all states pay us a broker fee for closed loans or we would most likely go bankrupt. I would also like to point out a couple of items in this disclosure:

-The disclosures, terms of use, etc. are the same at LendingTree.com as they are through any partner, which illustrates my point that Lenders do not pay any additonal fees to LendingTree when working with a customer through an airline program.
-The actual amount of the 'broker fee of up to $925' is determined by the amount of the loan and is rarely that high.
-"This is the total compensation LendingTree will receive from the Lender for its services and is paid by the lender." This states that the Lender cannot pass the cost on to the consumer. Therefore, this cost is incurred by the lender.

As a person with an interest in a competitor to LendingTree I would expect nothing less than negative opinion of our program and I respect your loyalty to your own �Miles-for-Mortgage� Program�whichever that may be.

Thank you for the response bocastephen. Let me know if you have any other questions.

Eric

Thanks to the two experts in the business contributing to this discussion. I have a question for you:

A reader of my website told me that he was obtaining a home equity loan from a lender offering miles. He indicated that the salesperson he spoke with advised him to take out the maximum amount possible on the loan to get the most miles, and then immediately pay back what he doesn't need. So, are there extra costs for the extra size of the loan other than the cost of interest for a few days? Do larger loans generate larger interest rates or more points, or the like?

Thanks.

sorry, this will get abit long-winded...

well, I don't have a 'negative opinion' of lendingtree...I am just offering information to ensure consumers make an informed choice and remember that you don't get something for nothing. The lenders may not pay an additional fee to lendingtree for a mileage-earning mortgage, but the lender or broker can pad the yield spread to offer a standard appearing loan rate while ensuring enough profit to cover the travel incentive. The customer might have qualified for a lower rate with less spread. The cost of the fee might be covered by the lender, but it is certainly being passed on to the consumer indirectly through the rate - which is the essence of yield spread premium pricing. If the lendingtree fee is less than $925, it would seem even more difficult for me to comprehend how the travel awards are being paid for unless there is premium pricing somewhere - you can't pay the airline for the miles with thin air.

Gary, now to your reader. Without knowing the broker or lender, or how they price their closing costs, I can say that a couple things might be going on here. Most closing costs on a mortgage are fixed, although some items, like pre-paids, will vary with the amount. Given this is a home-equity loan and the property is not changing hands, I will take a guess that the closing costs should be similar regardless of the loan amount. The reader should have a good faith estimate for both loan amounts they are considering to compare. Now, the larger loan amount could make a difference to the broker. If he is charging yield spread (most likely, if no broker fee is on the GFE), then his earnings will definately vary with the loan amount. Most brokers won't disclose their back-end fee (yield spread), but it's always worth a try to ask and make sure it's not something outrageous. The broker will definately earn more from a higher loan amount, but provided there is no pre-payment penalty and the closing costs are the same, it should be OK for the reader to do this. Just make sure the excess is paid quickly so the extra interest expense doesn't wipe out of the value of the extra miles.

Gary- you may also want to mention that the reader's payment will obviously be affected by the larger loan amount on a Home Equity Loan. If this is a fixed payment, no matter how much he pays up front to save money in interest over the life of the loan, he will continue to make the same payment on the larger loan amount (i.e. payment on a $100,000 loan vs. a $20,000 loan). I can't speak for all programs, but I assume most mileage programs are similar and if the reader would not be opposed to taking a Line of Credit with a variable rate, his payment will immediately be reduced once the loan amount is paid down (a HELOC can be risky since rates are on their way up, but is still a sound investment). I know there are people who get a Home Equity Line of Credit through LendingTree with no closing costs, receive miles after closing, and do not even use the line of credit. Some lenders require that you borrow a minimum amount to receive the lowest rates and in that case, they would 'borrow' from their line of credit and pay it back immediately with no pre-payment penalty.

Bocastephen - The reason LendingTree and our Lenders do not charge a larger amount in fees/rates for loans associated with a mileage program is that any volume or closed loans associated with these programs are only a small fraction of the total volume/closings for LendingTree. Therefore, there is no reason to charge a larger amount to the lender or customer for such a small fraction of the business. Once again, in some cases, our lenders are not even aware that the customer is a part of a mileage program when they submit (in which case they would have no reason to charge a higher rate or fee structure to the customer) although they do have access to the source of their request. Does the 'Miles for Mortgage' program that you have an interest in charge any additional fees/higher rates for loans associated with that program?

Eric