Upstart Reviews on its Personal Loans & Debt Consolidation
Is Upstart a legitimate loan company? Upstart is a legitimate, publicly traded borrowing platform (ticker symbol: UPST) that connects consumers with regulated banks and credit unions. Since 2012, Upstart has offered access to credit products including personal loans, debt consolidation and credit card refinancing, and auto-related financing. Its AI-powered underwriting model considers factors beyond a traditional credit score when evaluating applicants.
Upstart loans can be attractive for refinancing high-interest debt, including credit card balances and medical bills. Because Upstart’s underwriting model considers factors beyond credit score alone, some borrowers with limited or less-than-perfect credit histories may qualify for offers they might not receive from lenders that rely more heavily on traditional credit criteria.
Upstart Network, Inc. is an NMLS-licensed borrowing platform and a BBB-accredited business with an A+ BBB rating. Upstart’s marketplace includes more than 100 banks and credit unions, and its AI underwriting technology considers thousands of variables, including factors beyond traditional credit scores.
Key Takeaways:
Upstart's AI model approves more borrowers with fewer defaults than traditional lenders using credit score-only models.
Upstart evaluates factors beyond credit score alone, which may expand borrowing options for consumers with limited or less-than-perfect credit histories.
According to the company's report, Upstart has 44% higher approval rates and 36% lower interest rates.
Get free rate checks without impacting your credit score.
The company lands on our list of the best debt consolidation companies. Upstart is also ranked #2 for the best personal loans.
Pros
- Options for borrowers with little to no credit history
- Able to fund loans one business day after the borrower accepts a loan offer
- Allows borrowers to choose and change payment dates
- No prepayment fees
- No minimum credit score to qualify
- Pre-qualification won't affect credit score
Cons
- Limited mobile app availability
- Origination fee may apply
- Only two repayment term options
- No rate discount for autopayments
- Cannot include a cosigner for loans
What's different about Upstart loans?
Upstart offers personal loans to borrowers with lower credit scores and limited credit history.
The majority of unsecured loan applicants can receive an instant decision without providing additional supporting documents, although some applications require further verification.
Approved borrowers may have their funds transfer initiated in as fast as 24 hours. Actual availability depends on the borrower’s bank.
Additionally, Upstart offers direct creditor payments for debt consolidation loans, simplifying the process of managing multiple monthly payments and reducing the risk of late payments.
Check Upstart loan rates for free. When checking loan rates through Upstart, there is no negative effect on your credit.
What other companies offer loans similar to Upstart?
Other personal loan companies and platforms serving similar borrowers include Best Egg, Upgrade, Achieve, and Avant. Rates, fees, credit requirements, loan amounts, and underwriting methods vary by provider, so borrowers should compare prequalified offers before choosing a loan.
Dave Girouard, Upstart's CEO, initially departed Google to establish the company. Under Girouard's leadership, Upstart has become a technology-focused entity dedicated to revolutionizing the lending landscape. Recognizing an opportunity to assist banks in extending loans with lower risk and enhancing consumer access to borrowing, Girouard's tech expertise, combined with Upstart's proprietary AI technology, positions the company as a standout in the competitive loan industry.
Upstart Features and Benefits
Upstart offers an impressive list of features to its customers.
Uses artificial intelligence to determine creditworthiness
No minimum credit score
Soft credit check to pre-qualify
Get funding in one day
Payment date flexibility
Available in all 50 states
Online application and approval
Borrowing options for new credit histories
Offers direct payment to creditors for consolidation loans
Allows borrowers to choose and change payment dates
No prepayment fees
Loan Amount $1,000 to $75,000
Loan terms 36 or 60 months
In business since 2012
A+ BBB rating
Upstart Loan and Debt Consolidation Facts
Upstart offers quick approval times. The company's site claims you'll know your interest rate in about 5 minutes and you can receive money in as little as a single business day. Following are Upstart facts to keep in mind.
Origination Fee | 0% – 12% of initial amount |
Late Payment | Greater of 5% of past due amount or $15 |
Returned Check/ACH | $15 |
Paper Documentation Fee (optional) | $10 (one-time fee) |
Loan Terms | 36 or 60 months |
Minimum Credit Score | No fixed minimum in most states |
Loan Amount | $1,000 to $75,000 - State minimums and maximums may vary. |
Limitations |
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Is Upstart a direct lender?
No, Upstart is not a direct lender. Instead, it is a lending platform that connects borrowers with banks and credit unions. This means that when you apply for a loan through Upstart, you are not actually applying to Upstart itself, but rather to one of its lending partners.
Upstart uses a proprietary algorithm to assess borrowers' creditworthiness, which considers factors beyond just their credit score. This means that borrowers with fair or average credit may be more likely to be approved for a loan through Upstart than through a traditional lender.
Once you are approved for a loan through Upstart, you will be matched with a lending partner who will fund the loan. You will make your monthly payments directly to the lending partner, not to Upstart.
Upstart Interest Rates
The company offers a wide range of interest rates that individuals may qualify for. In general, the better your creditworthiness, as determined by Upstart's non-traditional approval approach, the lower your loan rate could be.
Upstart uses a collection of data points to determine your rates, including but not limited to your credit score, credit history, income, education, and work experience. However, none of those individual attributes will automatically qualify or disqualify a borrower.
How to Get an Upstart Loan or Debt Consolidation Loan
Getting an Upstart Loan requires approval. Upstart recommends determining your credit score, how much you need to borrow, and knowing your comfortable loan payment amount before committing to a personal or debt consolidation loan.
To start the debt consolidation process, you can prequalify with Upstart on the company's website by providing some personal and financial information. Upstart then performs a soft inquiry on your credit report and shares your information with lending institutions. The soft inquiry won't appear on your report or affect your score or inquiry count. The prequalification step doesn't equate to loan approval.
Approval and Acceptance
After checking your rate, Upstart may present a loan offer based on information in your application and the underwriting criteria of its lending partners. Checking your rate uses a soft credit inquiry and does not affect your credit score.
If you accept an offer and continue with the application, a hard credit inquiry is performed to verify your information and can affect your credit score. Final approval may also require identity, income, employment, or other supporting documentation.
Finally, you'll be asked for identification and various documents to prove your income, age, Social Security number, and address—After which you can accept the personal or debt consolidation loan.
How long does it take Upstart to review your application?
Most Upstart applicants receive a decision quickly, and the majority of unsecured loan applicants receive an instant decision after submitting a completed application. However, applications that require additional documentation or verification can take longer to review.
Upstart uses its AI-powered underwriting model to evaluate information beyond a traditional credit score, including factors related to your income, employment, credit history, and other financial information. This approach can help Upstart evaluate borrowers with limited or less-than-perfect credit histories.
If additional verification is necessary, Upstart may request documents to confirm information such as your identity or income before granting final approval.
Once your loan is approved and you accept the offer, Upstart may initiate the transfer of your funds as soon as the next business day. The actual time it takes for the money to appear in your account depends on your bank and when you complete the loan process.
Upstart Loan or Debt Consolidation Loan Requirements
Using a non-traditional approval process allows Upstart to approve some consumers who may not otherwise qualify for a debt consolidation loan. However, there are some minimum requirements to qualify.
$12,000 annual income
No fixed minimum credit score in most states; lender and state requirements may vary.
18 years of age or older
No significant credit score drops between the offer and acceptance
Must meet minimum debt-to-income ratio depending on state of residence
Recent bankruptcies or unpaid public records may affect eligibility.
No current delinquencies on credit report
Recent credit inquiries and other credit-profile factors may affect eligibility.
Upstart Credit Score Requirements
Upstart does not currently list a fixed minimum credit score requirement in most states. Its underwriting model considers credit history along with income, employment, education, debt obligations, and other factors. Individual lending partners and state requirements can vary, and no credit score guarantees approval.
How Does Upstart Make Money?
Upstart only connects consumers to lenders. As such, the company doesn't generate its primary income directly from interest rates like a typical lending institution. The company instead makes most of its money through fees charged to its partnering companies for referrals, volume, and loan servicing.
Upstart Personal Loans Reviews
Upstart receives sharply different customer ratings depending on the review platform. As of publication, Trustpilot rates Upstart 4.9 out of 5 based on more than 71,000 reviews, with 97% of reviewers giving five stars. Reviewers frequently praise the fast, simple application process, although some criticize high rates or origination fees. The company is also BBB accredited and holds an A+ BBB business rating.
Is an Upstart Debt Consolidation Loan Right for You?
A debt consolidation loan is a big commitment. In practice, debt consolidation effectively replaces several smaller payments with a single, typically larger, monthly debt payment. Upstart proves that its AI platform works for approving customers that other companies may not qualify for a loan.
However, Upstart loans and debt consolidation often come with higher origination fees than some of its competitors. Origination fees for some borrowers can be as high as 12%.
An Upstart debt consolidation loan will likely appeal to lower to moderate-income borrowers with a below-average credit score or short credit history, looking to consolidate a moderate amount of high-interest debts.
Upstart Loans Vs. SoFi
Which is better, Sofi vs. Upstart?
Upstart and SoFi both offer personal and debt consolidation loans and sport A+ grades at the BBB. However, that's where the similarities end. Where Upstart operates as a platform that connects consumers to appropriate lenders, SoFi is a completely online bank that offers numerous services beyond debt consolidation.
As a bank, SoFi also offers checking and savings accounts, credit cards, and other financial services.
While SoFi provides more services and term arrangements than Upstart, its requirements for loan approval are more stringent. Here's how they stack up by the numbers.
Feature | Upstart | Sofi |
BBB Grade / Rating | 1.24 / A+ | 1.23 / A+ |
Average Reviews Rating | 3.4 | 4.0 |
Origination Fee | 0% – 12% of initial amount | 0% |
Loan Terms | 36 or 60 months | 24,36,48,60,72, or 84 months |
Minimum Credit Score | 300 | 680 |
Loan Amount | $1,000 to $50,000 | $5,000 to $100,000 |
Frequently Asked Questions
Conclusion
About Upstart
Legal name: Upstart Network, Inc.
Address: 2950 South Delaware Street, Suite 410, San Mateo, CA 94403
Upstart's loan license number: NMLS ID: 936133. Email licenses@upstart.com with questions related to its license.
Website: www.upstart.com
Phone: 833-212-2461 / Toll-Free Number: 833-212-2461
Time in business: 02/27/2012
Publically listed? Yes. Ticker Symbol: (UPST)
Disclosure
Upstart Loan Disclosures: What You Need to Know
Loan Amounts
Upstart loan amounts range from $1,000 to $75,000. The amount you are eligible to borrow is determined by a variety of factors, including your credit score, income, and education level. Upstart also uses artificial intelligence (AI) to predict your creditworthiness, which means that you may be approved for a loan even if you have a lower credit score than traditional lenders require.
Minimum Loan Amounts by State
The minimum loan amount varies by state. In Georgia, the minimum loan amount is $3,100. In Hawaii, it is $1,500. In Massachusetts, it is $7,000.
Speed of Approval
Upstart loans can be approved within 24 hours. If you accept your loan by 5:00 PM EST (excluding weekends and holidays), you will receive your funds the next business day. However, if you are using your loan to fund education-related expenses, there is a three-business-day wait period between loan acceptance and funding, as required by federal law.
Security
Most Upstart loans are unsecured; however, certain lenders may place a lien on other accounts you hold with the same institution. It is important to review your promissory note carefully before accepting your loan to understand the full details of your loan agreement.
Credit Reporting
When you check your rate on Upstart, a soft credit inquiry will be performed. This type of inquiry does not affect your credit score. However, if you accept your rate and proceed with your application, a hard credit inquiry will be performed. This type of inquiry will impact your credit score. If you take out a loan, repayment information may be reported to the credit bureaus.
APR Calculation
Upstart's APR calculation compares the Upstart model to a traditional credit-score only model. The calculation is based on the average APR offered to borrowers up to the same approval rate. The hypothetical credit-score only model used in Upstart's analysis was developed in connection with the Consumer Financial Protection Bureau's No Action Letter access-to-credit testing program.
Decision Time
The majority of Upstart borrowers receive an instant decision upon submitting a completed application, without providing additional supporting documents. However, final approval is conditioned upon passing the hard credit inquiry. Loan processing may be subject to longer wait times if additional documentation is required for review.
About Author
Deane Biermeier
Deane Biermeier is a certified financial educator through the University of Minnesota and a respected authority in financial research, writing, and editing, renowned for his in-depth analyses and expert advice. With a distinguished career that previously spanned home improvement, real estate, and finance topics, Deane's role at Trusted Company Reviews focuses exclusively on finance. Deane has contributed to leading publications such as Forbes Home, US News and World Report, Newsweek Vault, and others. Since joining TrustedCompanyReviews.com in 2023, he has solidified his reputation as a crucial resource for clear, factual financial guidance.
