One of my goals for the week was to get pre-qualified (pre-approved, pre-authorized) for a mortgage. I’ve read this is the bargaining chip you use to get realtors to take you seriously. Following the review and advise of my friend Jim, I decided to give Lending Tree a shot. When he used Lending Tree a few years back, he got a friendly phone call within hours and numerous hours soon to follow. Unfortunately, I cannot say the same happened for me. Yet I know I have excellent credit, plenty of income, and a reasonable down payment. So what happened?

Filling out the online Lending Tree application was pretty simple, and took about 15 minutes. I was feeling good (a small step, but progress) and ready for banks to fight over me (!). A brief Lending Tree intro. Lending Tree acts as the middle man between banks within their network and you. They talk to all the banks for you and get you the best deal. They hold your hand through the whole process. There is another slightly less convenient avenue they offer too called their Get Smart service. If they can’t get 5 in-network bank offers for you, they will (at your request) send all your information to other mortgage brokers who will contact you directly. Back to the story…

Immediately after submitting, Lending Tree pops up a window saying the following banks are already competing — Yes! Except… there was only one bank listed. Hmm. I thought that was odd, but whatever. I’ll just wait for my courtesy phone call like Jim got!

Hours pass. Nothing. I check my email. There is an email from Get Smart saying my information had be passed on to two other brokers. Okay, works for me. Over the next two days, I talk to both brokers and I’m happy to say I got all the pre-qual letters I need (for now at least). But I never heard from Lending Tree…

Eventually today I receive an email directly from Lending Tree with the offers from all my competing banks (yep, all ONE of them). At this point, I already have my pre-qual letters so I’m set. But I’m still curious about why I only got one bank directly through Lending Tree.

Still bitter about not getting my personal welcome phone call like Jim, I call Lending Tree up. The lady was very nice, helpful and professional. I basically asked why I only got one offer. She goes over my information. Everything was correct — excellent credit, money down, amount desired. So what gives?

Not sure herself, she suggested perhaps I was asking too much for the property type I’m interested in ($400k, town home). Eh, I don’t know if I buy it, but I knew $400k was more than I really wanted to spend anyway. So I have her resubmit my application asking for $350k. This is significantly less money which means my down payment ($40k) is a larger percentage, montly payments will be a smaller fraction of my income, etc.

But once again, I check my email and exactly ONE bank is competing for me (not even the same bank!)! Huh?!? And… where’s my courtesy phone call?!?!

Here’s my theory. When Jim purchased, housing was hot (Spring 2005, I think). Mortgages were flying all over. Lending Tree probably had a lot of business and had to keep things moving quickly to maximize profit. Fast forward to Early 2008. Housing is bursting. Credit is crunching. Lending is hard to come by, and the industry is cautious if not down right scared. And while I am a very desirable mortgage customer, I don’t have 20% down (I have about 10%). I think this must be key because Jim recently looked to recently looked to refinance through Lending Tree and once again got lots of offers immediately.

So banks aren’t exactly competing for me (not through Lending Tree at least), but I’m happy to say I didn’t “lose.” With my pre-qual letters in hand, I am ready to continue the slow, cautious process of looking for a home. In fact, my girl friend and I have an appointment with a realtor tonight.