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Upstart

2022 review

Upstart is a great choice for a personal loan if you have a poor or fair credit score. With the use of AI-based technology to evaluate your application, you can get approved within one business day.

8.0 / 10
Editorial Score
Andrea Miller
Andrea Miller
Senior finance writer and editor
January 6, 2022

Overview

Upstart claims to level the playing field for borrowers who have poor or fair credit by using advanced algorithms and artificial intelligence to evaluate loan applications. If you fall into this category and have trouble qualifying for personal loans from traditional banks and lenders, Upstart may provide a solution that meets your financial needs.

Through Upstart, you can apply for personal loans with interest ranging from 4.37% to 35.99% APR (annual percentage rate). Available loan amounts range from $1,000 to $50,000.

Upstart has been named as the best personal loan option for borrowers who have poor credit by U.S. News and World Report. However, if you have good or excellent credit, you can likely find better loan terms from a competitor. Upstart offers loans in all U.S. states except Iowa and West Virginia.

Best Choice 2022
8.0 / 10
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Upstart
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Products & Services

Upstart specializes in personal loans you can use to fund travel, cover unexpected expenses like car repairs and medical expenses, pay for big life events such as weddings, or take care of other financial needs. You can also use personal loan funds to pay for education expenses, unless you live in Washington DC, California, Connecticut, Washington, or Illinois.

You can use a loan from Upstart to refinance a loan from another lender, such as your auto loan. However, this company will not refinance its own loans. If you obtain a personal loan for credit card or debt consolidation, Upstart sends the proceeds directly to the previous lender, which takes a step out of the process for you.

Another online lender offering personal loans is LendingTree. For more details, read our expert LendingTree review.

Apply for a Personal Loan with Upstart

Rates and Terms

Upstart claims that most customers can access rates up to 10% lower than from traditional lenders. The company offers personal loans with fixed-rate APRs ranging from 6.76% to 35.99%. According to Upstart, its average loan has a three-year term with an APR of 24.34%.

Most personal loans from Upstart have repayment terms of three to five years. Extending your repayment term increases the amount of interest you will pay over the life of the loan. Once approved for a loan, you can choose your own payment date. This is a convenient feature to streamline your monthly bills.

You can apply for a loan with Upstart of $1,000 to $50,000. Several states have their own legal minimum loan amounts:

  • Georgia: $3,100
  • Massachusetts: $7,000
  • New Mexico: $5,100
  • Ohio: $6,000

Upstart offers only unsecured personal loans, which means you cannot improve your loan terms or chances of approval by adding collateral such as a car title. The company does not allow you to add a cosigner to your loan or apply with someone else, other common strategies to increase approval odds.

If you lose your job or income, you may qualify for Upstart’s hardship program. With this option, you can suspend loan payments temporarily. However, the loan still accrues interest, which will extend your total repayment term.

The origination fee Upstart charges, up to 8%, is higher than most competitors charge. These funds come out of your approved loan amount. For example, if you borrow $20,000, you would actually receive $18,400 after paying an 8% origination fee of $1,600.

If you do not remit payment within a 10-day grace period from your due date, the company charges a late fee. You must pay the greater of $15 or 5% of the late amount. Upstart will also impose a $15 fee if your bank returns your check or electronic funds transfer because of insufficient funds. The company charges a one-time fee of $10 if you opt for paper rather than electronic billing.

Application Process and Qualifications

If you have a FICO credit score of at least 600, you can potentially qualify for a personal loan with Upstart.

The company also accepts borrowers who have no credit, meaning you have never had a loan or credit card before.

You must show a U.S. address and U.S. bank account with an income of at least $12,000 per year, whether you work full-time or part-time or have another source of income. Upstart borrowers must be at least 18 years old, or 19 if they live in Nebraska or Alabama.

Upstart’s approval and underwriting algorithms also consider factors such as your credit score and education that may reflect your ability to make payments. The company reports that as a result, it has personal loan acceptance rates more than 25% higher than the industry average. Upstart uses thousands of these alternative factors when evaluating your loan application, such as:

  • History of delinquent accounts or bankruptcy
  • Debt to income ratio, or DTI
  • How many times you have applied for credit within the past six months
  • Where you live
  • Work history
  • College major or area of study

You can receive preapproval for an Upstart personal loan with a soft credit check, which does not hurt your FICO score. When you view your instant preapproval rate and terms, you can decide whether to move forward with the offer. If you decide to take the loan, you must submit additional information and undergo a full credit check, which may negatively affect your credit.

If you already have a loan with Upstart, you can qualify for approval on a second loan as long as the first loan has a balance of less than $50,000. You must also have a history free of late payments for at least six months.

When you click on the Borrow link at the top of the Upstart website, you’ll be asked to select from four buttons describing your intended loan purpose:

  • Pay off credit cards
  • Consolidate debt
  • Refinance my car
  • “Something else”

You can also enter a mail offer code if you got a postcard promoting Upstart. Next, the site will ask you to enter:

  • Your desired loan amount
  • The purpose of the loan
  • Name
  • Birthdate
  • Street address
  • Email address
  • Phone number
  • Education level
  • Area of study
  • Occupation income, including salary

Upstart protects your information with 256-bit encryption during the application process.

Apply for a Loan with Upstart

Approval Time

Upstart says 99% of approved borrowers receive approval as soon as they apply and a transfer of loan funds the next business day.

However, if you use the company for student loans, your funds are subject to a three-day hold under federal law, so be aware of that timeframe for planning purposes.

The due date for your first payment is usually about three to four weeks after approval. You can sign up for automatic payments or pay your bill online, by mail, or over the phone. Upstart does not offer an auto-pay discount, however.

Customer Service

Once you sign a personal loan with Upstart, you can log into an online dashboard to manage your loan. The site also provides a library of help center resources. You can send questions to Upstart through an online contact form, which promises to “respond shortly.”

Both current and potential Upstart customers have access to email and phone support. The general support number is available from 9 a.m. to 8 p.m. Eastern Time on business days and weekends, but closed on holidays. Unfortunately, when I called the general support number, it rang just once before going silent. The same thing happened on my second attempt.

In lieu of phone assistance, you can send support requests through email. After sending my question, I received the automated response below right away.

Customer Service

Within two business days, I received a follow-up email with a detailed answer to my question (“What type of interest rates are available with a credit score of 700?”). The customer service representative also provided information about how to access other resources and move forward with my application if desired.

Customer Service

Unlike most competitors, Upstart does not have a mobile app. If you prefer to manage your finances on your smartphone, this lender may not be your best option.

Summary

If you’ve met barriers when trying to obtain credit, Upstart’s approach might be a solution to improve your finances.

Research supports the lender’s higher-than-average approval rating for those in the fair-credit category. If you have a higher FICO score, shop around before going with Upstart, since you might be able to find lower rates elsewhere.

Personal loans offer flexible terms, fast approval, and the ability to access cash flow of $50,000 or more. While some personal loans damage your finances with excessive interest rates and fees, using a loan from Upstart to consolidate high-interest debt can improve your monetary outlook.

Upstart boasts a low customer complaint rate along with accreditation from the Better Business Bureau, which may provide peace of mind if you’re skeptical about online lenders. As with any financial product, conducting careful research can help keep you on track when selecting a personal loan.

Apply for a Personal Loan with Upstart

FAQ

Is Upstart a legitimate lender?

Upstart is a legitimate source of personal loans. If you receive approval, the funds come from one of the company’s partner lenders. The company has funded personal loans for more than a million customers since its inception.

How long does Upstart take to review applications?

You can receive approval for your personal loan from Upstart right away. However, some situations and loan types may require up to three business days for an approval decision. The company claims that most borrowers receive instant approval and funding within one business day.

Does Upstart require proof of income?

You must provide proof of income to complete the loan application process with Upstart. If you decide to move forward with the preapproval offer, the company will check your bank account information to verify that your income can support the new loan.

Does Upstart allow early payoff?

According to the Upstart website, you may pay off all or part of your loan at any time. The company does not charge a prepayment penalty if you decide to shorten your obligation with extra payments toward the principal balance.

Andrea Miller
Written by
Andrea Miller

Andrea Miller has been a writer and editor for more than two decades. She has previously covered financial topics for Solvable, Kabbage, and Credit.com. Outside of work, she spends most of her time with her husband, daughter, and son and enjoys hiking, yoga, and reading.

Pros:
  • Fast acceptance rate with funds usually available next business day
  • Lower credit score requirements than most other lenders
  • Consideration of factors such as education and job history for approval
Cons:
  • Comparatively high interest rates that may be difficult to repay
  • Does not offer loans with cosigners or secured by collateral
  • Costly origination fee of 8% of the loan balance
Bottom Line

Upstart provides an innovative alternative to traditional lenders, especially if you have less-than-perfect credit. The company reports an especially high approval rate for clients in the low-600 score range, who may have trouble finding a loan elsewhere. However, if your score falls in the good tier or above, you may be able to find better rates and lower fees elsewhere.

Personal loans of up to $50,000 can be used for anything from debt consolidation to wedding expenses. In addition to flexibility, Upstart offers fast approval for most borrowers.The company has an A rating and accreditation from the Better Business Bureau, along with few complaints recorded with the Consumer Finance Protection Bureau.