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Class Action Filed Against LendingTree
A nationwide class-action lawsuit has been filed against LendingTree LLC and its wholly owned subsidiary, Home Loan Center Inc., alleging that they have engaged in unfair business practices and false advertising.
The suit, filed by the law firm of Teuton, Loewy & Parker LLP in Orange County Superior Court, notes that LendingTree's slogan is: "When banks compete, you win." With this slogan, LendingTree styles itself as an online lending exchange that connects borrowers to a network of lenders that allegedly "compete" for the borrowers' business, the suit says. However, the suit alleges that in thousands of cases there is no such competition and that LendingTree uses its website and false advertising to generate leads for its wholly owned direct-lending division.
The lawsuit further alleges that LendingTree secretly diverts many LendingTree.com leads to its subsidiary, where unsuspecting borrowers are sold loans at inflated prices based on the materially false representation that "competition" has occurred among lenders.
Rebecca Anderson, a spokeswoman for Lending Tree, said the suit arose out of the termination of a "disgruntled LendingTree employee who was let go after working with the company for nine months."
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