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Upstart Personal Loans Review
What does this mean for you? On the consumer side, Upstart has been able to offer high-quality personal loans with low rates and fair terms to borrowers with less than perfect credit. Upstart also features mostly five-star reviews from users on TrustPilot, and many of their applicants get their loans funded as soon as the next business day.
Upstart is a unique online lender that was founded by former Google executives in 2012. As the first lending platform to use artificial intelligence to automate the lending process, the company goes the extra mile to offer loans to a wider range of consumers. Since their inception, Upstart has originated $3.2 billion in loans, 60% of which have been automated.
Where most lenders focus on your FICO score when approving you for a personal loan, Upstart uses their advanced technology to look beyond your credit score to quantify risk. Based on their calculations, Upstart believes lenders who use a more intuitive credit model may be able to approve twice as many borrowers without increasing defaults.
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Upstart Personal Loans: Key Takeaways
- Upstart personal loans are available in amounts between $1,000 and $50,000.
- Repay your loan over three or five years.
- Fixed interest rates are offered between 8.13% and 35.99%.
- Checking your rate on Upstart will not affect your credit score.
- These loans come with no prepayment penalty, but you may have to pay an origination fee of up to 8% of your loan amount.
- You’ll need a minimum credit score of 620 and minimum annual income of $12,000 to qualify.
Upstart Personal Loans Review
There are many reasons to consider a personal loan from Upstart, but it all starts with the dynamic way this lender approves consumers for their loan products. Upstart looks at more than just your FICO score to approve you for a loan, including non-conventional variables such as the number of hard inquiries on your credit report, whether you have a college degree, and your earning potential.
The fact that Upstart looks at a broader number of factors when approving you for a loan can make the process easier if you have only “okay” credit, or any score close to the 620 minimum this company requires. However, it’s important to know that Upstart does require you to have no bankruptcies or delinquent loans. You may also need to submit additional information to qualify if your credit isn’t great, including SAT scores, information on your area of study, or detailed employment information.
We like the fact Upstart lets you borrow up to $50,000 for debt consolidation, a wedding, a home remodeling project, or nearly any other reason. Since many lenders only offer personal loans in amounts up to $35,000 or less, this can be a huge benefit if your borrowing needs are high.
Upstart also offers flexible repayment terms with the option to repay your loan over three years or five years. Upstart loans also come with no prepayment penalties and no hidden fees.
Where Upstart Comes Up Short
Our main gripe with Upstart is the fact they may charge an origination fee of up to 8% of your loan amount. This fee amount can represent huge costs for the borrower. Plus, paying up to 8% of your loan amount in an origination fee is pretty much unprecedented in the personal loan space. Many of the best personal loans don’t charge an origination fee at all, and even the lenders who do tend to limit them to 5% or 6% of your loan amount.
Another downside of Upstart is the fact their minimum interest rate starts at 8.13%. That’s considerably higher than some other personal loan companies that offer interest rates as low as 5.99% for borrowers with excellent credit.
Here’s an example of how your personal loan might look if you borrowed money at one of Upstart’s highest interest rates:
With this example loan, you’re expected to pay an origination fee of over 5% plus an APR of 29.75%. Over the lifetime of this loan in its present form, you would wind up paying $17,484.45 in interest if you wrapped the origination fee in your loan amount — almost as much as the loan itself.
Finally, Upstart personal loans are not available in West Virginia or Iowa. If you live in one of those states, you’ll need to shop for a personal loan with a different lender.
Who Upstart Personal Loans are Best For
- Consumers with decent or good credit who can qualify for a loan with the best rates and a low origination fee.
- Anyone who cannot qualify for a personal loan with no fees.
- People who need to borrow up to $50,000 for any reason and pay it off in up to five years.
How to Apply for a Personal Loan from Upstart
Before you apply for an Upstart personal loan, it’s helpful to know their minimum qualification requirements. To receive a loan, you’ll need to:
- Have a permanent street address in the U.S. (unless you’re active duty military)
- Live in a state other than West Virginia or Iowa
- Be at least 18 years old in most states or at last 19 in Alabama and Nebraska
- Have a valid email account, name, date of birth, and Social Security number
- Have verifiable employment or a full-time job offer that starts in six months or less
- Have a valid U.S. bank account
- Have a credit score of 620
Applying for a personal loan from Upstart is easy thanks to their convenient online portal. It all starts with getting “pre-qualified for a loan” through their interface, which you can do after submitting information such as your name, income, employment details, address, phone number, and email address.
Once you’re pre-qualified, you can decide whether you like the loan terms you were offered. If you do, you can move forward by completing the application with your Social Security number.
If you’re approved for a personal loan, you may receive instant notification verifying your new loan details. You may also have your loan funded with an automatic deposit in your bank account as soon as the next business day.
Should You Get a Personal Loan from Upstart?
If your credit isn’t perfect or you have a thin credit profile, applying for a loan through Upstart can make a lot of sense. This lender will consider more than your credit score when assessing you for approval, which can help you get the money you need even if your credit needs some help.
However, Upstart may not offer the lowest rates or best loan terms available. If you want to end up with the most affordable personal loan available based on your credit score, it’s crucial to shop around and compare loan rates, terms, and fees. The right loan is out there waiting for you, but you’ll need to do some legwork to find it.
Keep Reading
Methodology
The SimpleScore is a proprietary scoring metric we use to objectively compare products and services at The Simple Dollar.
For every review, our editorial team:
- Identifies five measurable aspects to compare across each brand
- Determines the rating criteria for each aspect score
- Averages the five aspect scores to produce a single SimpleScore
Here’s a breakdown of the five aspect scores and their rating criteria for our review of the best personal loans of 2020.
Why do some brands have different SimpleScores on different pages?
To ensure the SimpleScore is as helpful and accurate as possible, we developed unique criteria for every category we compare at The Simple Dollar. Since most brands offer a variety of financial solutions, their products and services will score differently depending on what we’re scoring on a given page.
However, it’s also possible for the same product from the same brand to have multiple SimpleScores. For instance, if we compare NetCredit’s personal loans according to our criteria for the best personal loans, it scores a 2.3 out of 5. But when we compare NetCredit according to the criteria for the best bad credit personal loans, it scores considerably higher, since the criteria for the latter review are more lenient (lenders who serve borrowers with bad credit will always offer higher rates, so we needed to adjust our category methodology to account for different industry standards).
Questions about our methodology?
Email Hayley Armstrong at hayley@thesimpledollar.com.
Rates
We looked at the maximum APR for each lender — the lower their maximum rate, the higher their score.
Loan Size
We awarded higher scores to lenders with more generous loan sizes.
Customer Satisfaction
We leveraged the J.D. Power 2019 Personal Loan Satisfaction Study℠ to see how customers rated their experience with each lender. (If a lender wasn’t included in J.D. Power’s study, we skipped this aspect and averaged the four remaining aspect scores.)
Support
We awarded higher scores to lenders with the most channels for customer support.
Fees
We looked at the three most common fees — origination, late payment, and pre-payment — and penalized lenders for each fee charged.
Reviewed by
Courtney Mihocik
Courtney Mihocik is an editor at The Simple Dollar who specializes in insurance, personal finance, and loans. Previously, she wrote and edited for Interest.com, PersonalLoans.org, Ballantyne Magazine, Thread Magazine, The Post, ACRN, The New Political, Columbus Alive and the Institute for International Journalism.
