To review Upstart’s personal loan, NerdWallet collected over 40 data points from the lender, interviewed company executives, and compared the lender to others who are looking for the same customer or offering a similar service. Personal loan product. Loan terms and fees may vary from state to state.

Upstart personal loans can be used for a variety of purposes including debt consolidation, medical bills, and home improvement. Most borrowers use their funds to consolidate debt or pay off credit cards, according to the company.

Bridgepayday / payday loan online biggest differentiator is its subscription model. The company uses artificial intelligence and non-traditional data – like college education, work history, and residency – to assess borrowers. More traditional lenders, like banks, focus almost exclusively on the borrower’s credit report, debts, income, and assets.

According to a company spokesperson, the company’s underwriting helps young applicants and those with poor credit histories or low credit scores but high income potential to qualify for a loan.

Upstart is ideal for borrowers who:

  • Have at least a 580 FICO score and strong earning potential.
  • You want to consolidate other debts.

Upstart at a glance

 Flexible credit check to pre-qualify.Reports payments to three credit bureaus.
 APRs are consistent among lenders targeting similar borrowers.Origination and delay costs.No tariff reduction for automatic payments.
 Offer direct payment to creditors with credit card consolidation loans.Finances most loans within one business day.Borrowers can use an Upstart loan to refinance a loan from another lender, but not an existing Upstart loan.Loans available in all 50 states.
 Clearly discloses rates and conditions on the website.A comprehensive FAQ answers many common borrower questions.
 Offers multiple customer contact channels.Customer service is available seven days a week, but not 24/7.

Where Upstart stands out

Quick financing: Upstart provides quick loans which are usually funded the next business day, with the exception of education loans, which have a three-day waiting period.

The company says borrowers can pre-qualify to see their rate in five minutes, and 99% of loans are funded one business day after signing.

Direct payment to creditors: For personal loans used to pay off credit cards, Upstart sends your loan proceeds to your credit card issuers to simplify the debt consolidation process.

Flexible payments: Borrowers can change their monthly payment date an unlimited number of times through the Upstart online portal. Changing your payment date does not change your original due date, however, and the 15-day grace period for late fees applies to your original due date.

For example, if your loan is due on the 8th of the month and you move your payment date to the 10th, your payment will not be late because it is within the grace period of the due date. However, if you move your payment date to the 25th, it will be late and you may be charged a late fee.

Several ways to pay: The lender allows borrowers to pay by postal check, over the phone, online and with automatic payments.

Alternative use of data: In 2019, the Consumer Finance Protection Bureau published a blog post attributing Upstart’s underwriting model to approving more applicants at lower rates than a traditional underwriting model. In a test, according to the bureau, consumers with FICO scores between 620 and 660 were approved twice as often as a traditional credit model, and applicants under 25 were 32% more likely to ‘be approved.

While lenders who use data such as college education and work history in borrower reviews say it gives them better insight into a borrower’s financial reality, consumer advocates say it could reinforce disparities. racial and economic issues.

Where Upstart fails

Limited reimbursement conditions: Borrowers can choose a repayment term of three or five years. These terms are quite common with online lenders, but they don’t allow you to shorten the term and save on interest or extend it for lower monthly payments.

Creation costs: Some lenders who use Upstart’s online lending platform charge a creation costs, which is not uncommon with personal loans, but it can increase your annual percentage rate.

No co-signed, joint or guaranteed loan option: Adding a co-signer, co-borrower, or getting a loan can help borrowers who might not otherwise qualify to get a reasonable rate on a personal loan. Upstart only offers unsecured loans.

How to qualify for an Upstart loan

  • Minimum credit score: 580.
  • Minimum credit history: none; borrowers whose credit history is too limited to produce a FICO score may be accepted.
  • Minimum gross income: $ 12,000.
  • Employment: Full-time job, full-time job offer starting in six months, regular part-time job or other regular source of income.
  • Must have a residential mailing address in the United States where the borrower resides (unless military personnel are on active duty).
  • Must be at least 18 years old.
  • Valid email account required.
  • Personal bank account with US routing number required.

Sample loan: A five-year $ 12,000 loan with 23.4% APR would cost $ 341 in monthly payments. You would pay $ 8,460 in total interest on this loan.

How to get an Upstart loan

Prequalification on NerdWallet

NerdWallet recommends comparing loans to find the best rate for you. Prequalification can allow you to get personalized rates from several lenders who partner with us, including Upstart. Prequalification will not affect your credit.

Apply on Upstart

You can check your rate on the Upstart website. Enter the amount you wish to borrow and answer questions about your credit score, education level, and other details to see an estimated rate for a loan.

Dwight E. Schulz