Best for Fair, Average Credit
Personal loans can be a strategic way for you to consolidate your debt or pay off big purchases over time. However, it takes a little research to apply, be qualified for and select a loan that is best suited for your needs and offers you favorable terms.
While you can always apply directly with a bank or credit union, Upstart offers a way to check multiple lenders at once. Unlike other lenders on CNBC Select’s list of best debt consolidation loans, Upstart is a peer-to-peer online lending platform that acts as an intermediary between you and its lending partners.
With flexible credit score requirements, Upstart may be more friendly to credit newcomers and people with lower-than-average credit scores.
CNBC Select reviewed Upstart’s personal loans looking at APR, perks, fees, loan amounts and term lengths. (Read more about our methodology below.)
Upstart marketplace Review
Upstart Personal Loans
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Annual Percentage Rate (APR)
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Loan purpose
Debt consolidation, credit card refinancing, home improvement, wedding, moving or medical
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Loan amounts
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Terms
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Credit needed
FICO or Vantage score of 580 (but will accept applicants whose credit history is so insufficient they don’t have a credit score)
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Origination fee
0% to 8% of the target amount
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Early payoff penalty
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Late fee
The greater of 5% of monthly past due amount or $15
APR
APRs for Upstart loans range from 8.27% to 35.99% and are determined based on factors including your credit, income, work experience and education history. (Neither Upstart nor its bank partners have a minimum educational requirement in order to be eligible for a loan, however.) Interest rate is only one factor in total APR, which is the cost of the loan over a year; other fees are outlined below.
Perks
Nearly all personal loan funds are sent the next business day after you complete all required paperwork before 5 p.m. (Monday through Friday). Education-related expenses and credit card refinancing loans, however, have a three-day waiting period.
Loan applicants need a FICO or Vantage score of at least 580, but Upstart does accept applicants who don’t have credit scores.
Fees
The origination fee for this loan is 0% to 8% of the loan you are approved for. One drawback of this loan is that this fee is automatically withheld from the loan before it is delivered to you.
Upstart charges a late fee that is either 5% of the amount that is past due or $15, whichever is greater.
If you request paper copies of your loan agreement you pay a $10 fee, but virtual copies are free.
There are no early payoff penalties with Upstart loans.
Loan amount
Loan amounts range from $1,000 to $50,000, but not all applicates will qualify for the full amount. How much you qualify for will be determined based on your credit, income and other information on your loan application.
Exceptions for the minimum loan amount are state-dependent: Massachusetts starts at $7,000, Ohio at $6,000, New Mexico at $5,100 and Georgia at $3,100.
Term lengths
Term lengths can either be three or five years.
Bottom line
A major drawback of Upstart personal loans are the high fees and APR, but if you have fair or average credit Upstart may offer higher approval odds compared to other traditional lenders.
If you are trying to improve your credit, consider other options before taking out a personal loan and think about what goes into your credit score.
If you have good to excellent credit and are looking to pay smaller fees, LightStream Personal Loans could offer you better terms and could be a better fit for you.
Our methodology
To determine which personal loans are the best for consolidating debt, CNBC Select analyzed dozens of U.S. personal loans offered by both online and brick-and-mortar banks, including large credit unions. When possible we chose loans with no origination or sign-up fees, but we also included options for borrowers with lower credit scores on this list. Some of those options have origination fees.
When narrowing down and ranking the best personal loans, we focused on…
Read More: Best for Fair, Average Credit