Is Upstart a Good Loan Company to Trust with Your Money

Upstart is a personal loan company that uses artificial intelligence and machine learning to evaluate loan applications. This approach allows Upstart to consider factors like education and employment history that traditional lenders might overlook.

Upstart's algorithm can review thousands of data points in seconds, making it a much faster process than traditional loan applications. However, this speed comes at a cost, with Upstart charging higher interest rates than some competitors.

Upstart's interest rates can range from 6.46% to 35.99%, depending on your credit score and other factors. This is a wide range, and borrowers with lower credit scores may be charged higher rates.

Upstart is a member of the Online Lenders Alliance (OLA), which promotes responsible lending practices and consumer protection.

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Upstart auto refinance loans can replace your existing loan with a new one at more favorable terms, potentially reducing your monthly payments and lowering your annual percentage rate (APR).

You can expect to save an average of $5,851 over the lifetime of your loan, according to Upstart's claims.

There are no application fees, origination fees, or prepayment penalties with Upstart, making the process more straightforward.

Upstart requires borrowers to take out a loan of at least $9,000, which is higher than some other lenders that offer refinance loans starting at $5,000.

To get an estimated rate, you'll need to go through the pre-qualification process, as Upstart doesn't display sample rates on its website.

Rocket Loans offers APRs ranging from 5.97% to 29.69%. This is a relatively narrow range compared to some other lenders.

Upstart's APRs range from 3.22% to 35.99%. Keep in mind that the lower end of this range is only accessible to borrowers with excellent credit.

A lower APR will reduce your loan's overall cost. This is especially important if you're taking out a larger loan.

Here's a comparison of the APR ranges offered by Rocket Loans and Upstart:

It's worth noting that while Rocket Loans has a lower maximum APR, its loans are more difficult to obtain due to its higher minimum credit score requirement of 640.

When choosing a loan, one of the most important factors to consider is the amount of money you need to borrow. The loan amount range varies between lenders, with Rocket Loans offering loans from $2,000 to $45,000, and Upstart offering loans from $1,000 to $50,000.

Lenders like Upstart offer more flexibility in their loan amount ranges, with a lower minimum of $1,000 and a higher maximum of $50,000. This makes them a great option for borrowers who need smaller or larger loans.

The loan amount you need will depend on your personal circumstances and what you plan to use the funds for. For example, a smaller loan may be suitable for minor expenses like home repairs or travel, while a bigger loan is better for larger expenses like debt consolidation.

Here's a comparison of the loan amount ranges offered by some popular lenders:

It's essential to only take out loans when absolutely necessary and to determine how much money you need before choosing a lender. This will help you avoid cash flow problems and keep your total debt manageable.

Upstart's eligibility and requirements are flexible, but having a good credit score certainly helps. To be eligible for a loan, you must be a U.S. resident, at least 18 years old with a Social Security number, and have a valid email and U.S. bank account.

You'll also need to earn a minimum of $12,000 annually and have a credit history with at least one of the consumer credit reporting agencies. Additionally, your debt-to-income ratio must not exceed 45% for certain states or 50% in all other states.

Here are the minimum financial and credit requirements in detail:

To qualify for an Upstart debt consolidation loan, you'll need to meet some basic requirements. You must be a U.S. resident, at least 18 years old, with a valid Social Security number, and not a resident of Iowa or West Virginia.

Upstart loans are not available to those who have recently experienced significant drops in credit score or added debt obligations. You'll also need to have a credit history with at least one of the consumer credit reporting agencies, such as Transunion, Experian, or Equifax.

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A minimum annual income of $12,000 is required, and you'll need to have a valid email and U.S. bank account. Your debt-to-income ratio, excluding rent or mortgage, should not exceed 45% in Connecticut, Maryland, New York, or Vermont, and 50% in other states.

You should also not have any bankruptcies in the last 12 months, unpaid or ongoing civil judgments or tax liens, or current delinquent accounts on your credit report. Fewer than six inquiries on your credit report in the last 6 months are also a requirement, with exceptions for student loans, vehicle loans, and mortgages.

Here are the key eligibility requirements in a concise list:

Keep in mind that Upstart's AI-based underwriting model considers your income and employment history, giving borrowers with bad credit a chance to get approved. However, a lower credit score may result in higher interest rates or less favorable terms.

Upstart auto refinancing is available in all states except Iowa, Louisiana, Maryland, Nevada, and West Virginia.

If you live in one of these states, you'll need to look elsewhere for refinancing options. Borrowers who prefer in-person interactions may consider a different lender due to Upstart's online-only nature.

To apply, you'll need to provide some basic information, including your desired loan amount, loan purpose, personal details, education, income, and savings.

The AI-powered system will generate offers based on your input, which may include APR, loan term, monthly payment, total loan amount, origination fee amount, and more.

The higher your credit risk, the higher the APR and fees, and the fewer offers you'll receive. You may also not get an offer for the amount you requested.

If you qualify, you'll get instant approval for 75% of loans, with no need to upload any documents. However, if you're part of the other 25%, you may be asked for more documentation.

Once you've accepted an offer, the money will be in your bank account as early as the next business day.

Here's a breakdown of the loan process:

Overall, Upstart's loan process is designed to be fast and convenient, with a focus on transparency and fairness.

Upstart's fees are a crucial aspect to consider when deciding if they're a good loan company for you. Upstart charges an origination fee of up to 12 percent, which is deducted from your loan principal at funding.

The origination fee is a "service fee" charged by lenders, and the worse your credit risk, the higher it will be. This fee can be a significant cost, especially if you need to borrow a large amount.

You'll still make payments and pay APR on the full amount borrowed, not the amount you receive after the fee is deducted. For example, if you're approved for a $10,000 loan with a 10% origination fee, you'll receive $9,000, but you'll still make monthly payments on the full $10,000.

Upstart also charges a late payment fee of $15 or 5% of the past-due amount, whichever is greater, if payments are made more than 10 days past the monthly due date. There's also a $15 fee if the money isn't in your account when the payment hits.

There are no penalties for paying your loan off early, but if the AI detects you as someone who's likely to do this, your APR or origination fee may be higher.

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Upstart's fees can be quite high, especially the origination fee, which can reach up to 12% of the loan principal. This fee is deducted from the loan amount, so if you're approved for a $10,000 loan with a 10% origination fee, you'll receive $9,000.

You'll still make monthly payments and pay APR on the full $10,000 loan amount, not the amount you receive after the fee is deducted. This is important to keep in mind when considering an Upstart loan.

Upstart also charges a late payment fee, which is the greater of $15 or 5% of the monthly past-due amount. This fee is charged on payments made more than 10 days past the monthly due date. Setting up automatic payments can help you avoid this fee.

Additionally, there's a $15 fee if the money isn't in your account when the payment hits, and your bank may charge an additional fee. However, it's worth noting that Upstart doesn't charge a prepayment penalty if you choose to make additional principal payments or pay off your loan in full ahead of schedule.

Here's a breakdown of Upstart's fees:

Upstart isn't available in all states and territories. You'll need to look elsewhere if you live in Iowa, Louisiana, Maryland, Nevada, Puerto Rico, or West Virginia.

If you're considering refinancing your auto loan with Upstart, be aware that it's not available in these states. This is an important consideration if you're shopping around for a lender.

Upstart auto refinancing is available in all states except Iowa, Louisiana, Maryland, Nevada, and West Virginia. This means you can consider it if you live in any of the other 45 states and the District of Columbia.

As an online lending marketplace, Upstart has no physical locations. If you prefer in-person interactions, you might want to look into a different lender.

Upstart has a unique approach to loan applications. It only allows a single borrower to apply for an auto refinance loan, which means joint applications won't be accepted.

If you already have a loan that includes a co-borrower, you can still apply to refinance the loan in your name only.

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Upstart offers auto refinance loans that can help you save money by replacing your existing loan with a new one at more favorable terms.

These loans can reduce your monthly payments, lower your annual percentage rate (APR), or extend the duration of your loan. According to Upstart, its refinance customers save an average of $5,851 over the lifetime of their loan.

To be eligible for an Upstart auto refinance loan, you must meet certain qualifications, including having a vehicle less than 10 years old and a maximum vehicle mileage of less than 140,000 miles.

Upstart also requires that your current auto loan balance be between $9,000 and $60,000, and that the current auto loan be at least one month old.

You'll also need a credit score of at least 510, although Upstart may accept borrowers without enough credit history to have a score.

To begin the refinancing process, you can complete Upstart's pre-qualification, which takes minutes and doesn't impact your credit score.

Additional reading: What Is a Good Fico Score for a Home Loan

The pre-qualification process involves filling out a form on Upstart's website, providing your name, address, date of birth, education, primary source of income, and total savings.

After pre-qualification, Upstart will provide several estimated loan offers from different lenders with various APRs and terms.

You'll need to upload documents that verify your identity, income, and education to complete the application and document verification phase, which typically takes one to two weeks.

Upstart claims that the application and document verification phase is relatively quick and easy, with no more work required on your part after this stage.

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Upstart has a strong track record of financial stability, with over $34 billion of loans originated and more than 2.7 million customers.

Upstart was founded in 2012 and works with about 100 bank partners to offer loans, providing a wide range of options for customers.

In its 2023 second quarter financial highlights, Upstart noted that total revenue was $136 million, down 40% from the prior year, likely due in part to the nature of the economy.

Upstart provides a convenient user experience, from online applications to digital payments, making it easy for customers to navigate the process.

Upstart's website provides detailed product pages for each of its loan offerings, as well as a comprehensive support section that answers many common questions.

Upstart is accredited by the Better Business Bureau (BBB) and holds an A+ rating, indicating a high level of customer satisfaction.

SoFi is a strong contender in the personal loan market, offering generous amounts and terms for those with good and excellent credit.

Their loan amounts range from $5,000 to $100,000, which can be a significant help for those looking to cover large expenses.

SoFi's APRs are competitive, ranging from 8.99% to 29.49% Fixed APR.

They also offer flexible loan term lengths, ranging from 2 to 7 years.

One thing to note is that SoFi allows optional fees, so be sure to review their terms before applying.

Their minimum credit score requirement is no requirement, making it a good option for those with good credit.

If you're approved by 7 p.m. ET, you can even get same-day funding.

SoFi also permits co-signers, which can be helpful for those who need a co-signer to qualify for a loan.

Upstart has been around since 2012 and has grown significantly, with over 2.7 million customers and over $34 billion of loans originated.

The company works with about 100 bank partners to offer loans, which helps to increase its reach and customer base.

Upstart's financial stability can be seen in its large customer base and loan volume, which suggests a strong foundation for the company.

Despite some challenges, Upstart's revenue was still $136 million in its 2023 second quarter, a significant figure that indicates the company's ongoing success.

Upstart provides a convenient user experience, from online applications to digital payments. This makes it easy to navigate and complete the auto refinance loan process.

Its website is well-designed, offering detailed product pages for each loan offering and a comprehensive support section that answers common questions about auto refinance loans.

Upstart's online application process is reported to be straightforward and quick, making it a smooth experience for users. Many customers have cited this as a major advantage of using Upstart.

If you're approved for a loan, Upstart will work with your local DMV to finalize the transfer and lien release, paying off your existing loan on your behalf. This can be a huge relief for those who need to refinance their auto loans.

Some users have mentioned that they were able to save money and get lower interest rates by using Upstart. This is a significant benefit for those looking to reduce their financial burden.

Upstart is accredited by the Better Business Bureau and holds an A+ rating, indicating a high level of customer satisfaction.

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Upstart has a strong reputation, with an A+ rating from the Better Business Bureau, indicating excellent customer service and issue handling.

The company has been part of the Consumer Financial Protection Bureau's pilot program since 2017 and was initially issued a "no action" letter, which meant it was free from regulatory oversight.

Upstart's AI model has been subject to scrutiny, with a group of U.S. senators expressing concerns about discriminatory lending in 2020.

A neutral third party, Relman, reviewed Upstart's model and made suggestions that prompted the company to tweak its AI model over two years.

Positive reviews praise Upstart's easy application process, variety of offers, and fast funding, with some reviewers noting friendly and helpful customer service representatives.

Negative reviewers have complained about high interest rates, income and education verification issues, and not being offered the full amount requested.