Founded by former Google employees, Upstart is the first lending platform to utilize artificial intelligence and machine learning to automate the borrowing process and price credit. With a “smarter” credit model that takes into account education and job history, Upstart has the ability to approve almost twice as many borrowers, with fewer defaults.
Since 2012, Upstart has originated $2.2 billion in loans and quadrupled in growth in 2017 alone. Want more intel? Keep reading for the good, the bad and my breakdown of personal loans through Upstart.
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About Upstart
Borrower Averages
The typical Upstart borrower is a recent college graduate with good GPA and SAT scores and low debt-to-income ratios.
| Average Credit Score | 692 |
| Average Income | $100,000 |
- No collateral required. Don’t own a house? It’s not going to be an issue here.
- Simple application process. Just head over to Upstart’s website and apply online.
- Unique approval process. The application process doesn’t only look at credit score. It’ll also focus on other factors like area of study, work history and GPA.
- Soft credit check. The initial credit check won’t affect your credit score, but if your loan is approved, a hard inquiry will show up on your report.
- Quick funding. It can take as little as one business day, if approved.
- Flexible fund use. A personal loan through Upstart can be used for debt consolidation, medical bills, travel and even education-related expenses.Upstart has partnered with several coding bootcamps that allows the borrower to use the loan for tuition, even if you don’t have a job or college degree.
- Fixed rate. It won’t budge for the entire duration of your loan term.
- No prepayment penalty. So you can pay that loan of yours back as quick as possible!
- Live customer service 7 days a week. Upstart’s friendly Silicon Valley-based team is available between 6am and 5pm on weekdays and 6am to 5pm on weekends, PST.
- Not available in all states. You can’t apply for an Upstart personal loan if you live in West Virginia or Iowa.
- Only 2 fixed term lengths. You’re limited between either a 3 year term or a 5 year term.
- The fees. Before receiving your funds, an origination fee of up to 8% will be deducted. The late fee is $15 or 5% of the amount due, whichever is greater. If your payment is returned due to insufficient funds, it’ll cost you another $15.
Eligibility Requirements
Applicants must have a minimum credit score of 620, a gross annual income of at least $12,000 and a debt-to-income ratio of up to 45%.
Upstart Terms & Fees
| Loan Amounts | $5,000 – $30,000 |
| Loan Terms | 3 or 5 years |
| Repayment Options | Monthly |
| Origination Fee | 0% – 8% |
| Soft Credit Check? | Yes |
| Typical APR | 7.00 – 35.99% |
| Funding Time | Usually 1 day; 3 days for education loans |
| Prepayment Fee | None |
| Late Payment Fee | $15 or 5%, whichever is greater |
| NSF Payment Fee | $15 |
| Check Processing Fee | None |
The Breakdown
Upstart is a great choice for borrowers with average credit or young borrowers who are new to credit, thanks to the lending platform’s unique approval process. Applying is painless, and you may be able to get your hands on funds as soon as the next day. Fund use is extremely flexible, including student loan repayment and tuition for coding bootcamp. Live and friendly customer service is available to you seven days a week. If you like your experience with Upstart, you can request a second loan even though you haven’t finished paying off the first one yet (terms apply).
Sample Loan
| Loan Size | $25,000 |
| Loan Term | 60 months |
| Origination Fee (4%) | $1,000 |
| Funds Received | $24,000 |
| APR | 18.0% |
| Total Interest | $13,090.14 |
| Monthly Payment | $634.84 |
Upstart’s rates aren’t the most competitive. If you are leaning towards Upstart, make sure to calculate in the origination fee of up to 8% and keep in mind their fees for late payment and insufficient funds. Also, you can only choose between a three year or five year term length. Lastly, sorry West Virginia and Iowa residents, Upstart is not available in your state.
Compare all the best personal loan lenders here.
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