- The Good
- Easy application process
- Wider range of qualification criteria
- Fast deposit
- The Bad
- Low loan maximum
Upstart is a great option for recent graduates who did well in school. When looking at your qualifications for a loan, Upstart takes into account your academic achievements from the last four years, which makes it perfect for recent graduates who may not have built up enough credit yet.
- 5.67% to 29.99%
- Origination fee
- 1% to 6%
Just like any lender, Upstart’s rates fluctuate depending on your credit and other factors that it uses to determine your eligibility for a loan. The APR ranges between 5.6 percent and 29.99 percent. There is also an origination fee, which ranges between 1 percent and 6 percent. Upstart’s late fee is $15 or 5 percent, whichever is greater, and the check-processing fee is $15.
The maximum loan amount for Upstart is $25,000, which is lower than most other online loan providers, making it hard for those who might want a larger loan. The minimum loan amount is $3,000, which is high and can make it difficult for those who are just looking for a quick, low-cost loan.
- Average to excellent credit
- Academic records
- Proof of income
- Low debt-to-income ratio
- Must be at least 18 years old
Unlike other online personal loan providers, Upstart will take into consideration your academic records if you have graduated college within the last four years. In addition to that, Upstart requires that you be 18 years old, have proof of a source of income, a low debt-to-income ratio and at least an average credit score.
- Loan Process
- Application > Application Review > Loan Approval
Upstart’s application process is pretty straightforward. Since they don’t rely on individual investors, you can be approved for a loan pretty quickly. First, you have to fill out a basic application that includes personal and financial information. Upstart will then review your application and let you know if you qualify for a loan and what your interest rate will be. If you qualify, you continue with the application process, which requires additional financial information. Once your application is complete, Upstart will notify you if you’ve been approved for the loan or not, and if you accept, the loan amount will be transferred to your bank account the next day.
- Partial Loans
Upstart does not offer partial loans. If you are not approved for the loan amount you originally asked for, you can apply for smaller loan amount later.
Upstart: User Reviews
There are many new start-ups in the lending world these days, but Upstart is one of the most interesting. Not only does it cater to recent graduates who need financial help, but it also specializes in funding tuition costs for those who are interested in learning how to code. This makes it a perfect lending option for young techies who not only want to get a head start on their career, but also their finances.
How Does Upstart Work
Even though their approval criteria may be a bit unconventional, Upstart operates very similarly to a traditional loan process. You go online and fill out a form that asks you for some personal and financial information. It will then send you an estimated rate for your loan. If you agree with the rate, Upstart will gather more information and prepare the loan paperwork to make it official. Once the loan is approved, you will get the money the next business day.
The approval process is a little bit different though. Upstart does look at things like credit score, employment income and income-to-debt ratio, but it also uses computer models to factor in your college degree, your major and your job history to give Upstart a fuller picture of who you are as a financial person.
These extra criteria are perfect for someone who doesn’t have much credit history but has shown great responsibility in school and previous jobs. It speaks to the problem that a lot of people have with credit scores; they don’t give the whole picture on how financially responsible a person is.
Upstart also makes it easy to set up recurring payments, and won’t penalize you for paying off your loan early, which many loan companies do. Upstart offers both three-year and five-year loans, so you can choose which will be easiest for you to pay off.
Is Upstart Legit?
While Upstart is only 5 years old, it has been busy in those five years. It has funded more than $700 million in lending so far, and has approved 60,000 loans. Upstart is also one of the only online lenders to completely automate a portion (25 percent) of its loans, which means both the approval process and funding of the loans are all down through algorithms and artificial intelligence.
It was founded by two ex-Google employees and is backed by Cross River Bank, which is backed by the FDIC, so you know your money is safe. It is also consistently rated as one of the top online loan companies operating today.
Common Upstart Reviews
Upstart may handle online loans in an unconventional way, but its users tend to love the service. Customer service reviews on sites like Credit Karma and TrustPilot give mostly five out of five star ratings to Upstart, with glowing reviews on everything from Upstart’s quick and easy online process to its exemplary customer service.
Most of the negative reviews on these sites seem to be from people who didn’t understand the process, wanted to cancel the loan after it was approved or were upset about being charged late fees. As with any financial service, always read the fine print before agreeing to anything, although Upstart is pretty upfront about all of their fees and rates.
From a consumer product review standpoint, Upstart is generally ranked near the top of the reviews because of its ability to lend to people who might not normally qualify.
Is Upstart Right For You?
There are hundreds of loan providers available now, so how do you know if Upstart is the right one for you? It really comes down to a few simple questions:
- Do you have excellent credit?
- Do you have average credit?
- If so, have you graduated in the past four years?
- Do you have a good job history?
If you have excellent credit, the world is your oyster when it comes to loans, so you can really choose any lender and be approved for a loan. The issue for people with excellent credit isn’t whether they can get approved or not, but rather what the interest rate is going to be. With Upstart, a good academic record coupled with excellent credit could score you a very low interest rate. If that’s not the case, you might be able to find a lower interest rate elsewhere.
If you have average credit, Upstart might be a good place to start. People with average credit or very little credit history can often have issues securing a loan, so lenders like Upstart that look at outside factors when approving you can only help.
The caveat to this is that if you haven’t graduated in the past four years, Upstart generally won’t look at your academics as a factor, which leaves you back where you started. In addition, if your grades were poor, you might also have issues getting approved. Luckily, Upstart also looks at your job history, so if you have had a steady job for many years with good standing, you might also have a good chance of being approved.
The point is that there are many different factors that Upstart uses when approving candidates, so if you’ve been turned down for other loans, you should take a look at Upstart.