- What is Upstart?
- How does Upstart work?
- How much does Upstart cost?
- Upstart features
- Who is Upstart best for?
- Who shouldn’t use Upstart?
- Pros & cons
- Upstart vs. Lending Club vs. Prosper
- The bottom line
What is Upstart?
How does Upstart work?
How much does Upstart cost?
Other potential fees
Better approval odds
No prepayment penalty
Who is Upstart best for?
Borrowers with poor credit
Borrowers who want to consolidate
Who shouldn’t use Upstart?
Borrowers who don’t have great earning potential
Borrowers who can’t afford the origination fee
Pros & cons
- Fast funding. Speed is one of the greatest benefits of using an online lender like Upstart. The ability to get your money to your bank account in one business day means that if you need money fast and qualify through Upstart’s platform, you’ll likely have the money you need in just a few days.
- Easy-to-use platform. While Upstart’s application process is a bit more detailed than other options on the internet, its thoroughness doesn’t make it difficult to navigate. While it might take you closer to 10 minutes to complete your loan application on Upstart, it’s a straightforward and clear process thanks to a clean user interface.
- Better approval odds. The fact that Upstart uses proprietary AI to approve borrowers means that they serve almost a quarter more consumers than traditional lenders using other credit reporting and approval models. This means that if you have poor credit or are looking to maximize your high credit score, Upstart will most certainly be a competitive offer.
- Origination fees. As has been mentioned, the origination fees Upstart charges can be cost-prohibitive depending on your financial situation and what rate you’re quoted. While the low-end of the 0%-8% range is certainly reasonable if you’re getting charged 7% or 8% on a $50,000 loan from Upstart that means that you’ll wind up paying an additional $3,500 to $4,000 for the loan.
- Higher minimum loan amounts in some states. Upstart advertises a $1,000 minimum loan amount; however, in some states, the minimum loan amount is quite a bit higher. For example, in Ohio, the minimum is $6,000 while in Massachusetts you’ll need to take out a loan of at least $7,000 to qualify.
- No co-signing. While not everyone is looking to have a co-borrower or co-signer on a loan, if that is something you’re interested in you’ll need to keep looking.
Upstart vs. Lending Club vs. Prosper
|Lender||Annual Percentage Rate (APR)||Minimum Loan Amount||Maximum Loan Amount|
|Upstart||7.68% - 35.99%||$1,000||$50,000|
|Lending Club||8.05% to 35.89%||$1,000||$40,000|
|Prosper||7.95% to 35.99%||$2,000||$40,000|
The bottom line
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