Alternative lender LendingTree is expanding with the acquisition of Ovation Credit Services, the company said Friday (May 11).
The marketplace lender, which facilitates financing for consumers and small businesses, will pay $20.75 million for the credit services company, the firms said in a press release. Ovation Credit Services offers a credit repair software solution that integrates directly with credit bureaus. The firm also offers consumers credit improvement education.
“LendingTree is committed to helping all consumers meet their financial goals, regardless of where they are in the credit spectrum,” said LendingTree Founder and CEO Doug Lebda in a statement. “According to industry estimates, almost one-third of Americans have poor or bad credit, and our own consumer traffic mirrors this situation.”
“By acquiring Ovation Credit Services, LendingTree will be able to better educate consumers about credit management and provide options for those consumers who have struggled with obtaining financing,” he continued. “Ovation Credit Services’ experienced management team, strong credit bureau relationships and customized software platform will ultimately enable LendingTree to help more consumers achieve their original financial goals through the LendingTree platform.”
The acquisition will consist of $12 million in cash, the firms said. LendingTree expects to close the takeover in the second quarter of this year.
“We are incredibly excited to join the LendingTree team,” said Ovation Credit Services President Terry Cordell in another statement. “Given LendingTree’s emphasis on consumer education and empowerment, we are confident that this is the right platform for Ovation Credit Services to expand its reach and help more consumers improve their credit health.”
Consumer debt in the U.S. is expected to reach $4 trillion by the end of the year, according to LendingTree data recently published.
A separate survey conducted by small business borrowers using LendingTree’s services released earlier this month found nearly two-thirds of SMBs expect to see savings as a result of tax reform, with more than a third expecting to use that extra cash to pay down debts.