Digital lending or online lending is cutting-edge financing that is more efficient and streamlined than traditional financial institutions. Its main function is to provide loans directly to borrowers with the help of advanced software and innovative algorithms. With the emergence of Artificial Intelligence, financial services are revolutionized around the world. AI technologies allow financial service providers to automize their business and bring creditworthiness to their organizations. Upstart is also an online lending platform based on artificial intelligence (AI). Let’s find out more about it in our Upstart review.
What is Upstart?
Upstart is a leading AI lending platform that initiates unsecured, fixed-rate loans with the partnership of banks. Founded in April 2012, Upstart improves access to affordable credit and reduces the lending costs for partner banks so that they can extend higher approval rates. At the same time, Upstart is busy with passing down exceptional lending experiences for its customers. The Upstart loans offered range from $1,000 to $50,000, and they are issued for 3 to 5 years with an APR from 7.86% to 35.99%. Since its inception, Upstart has originated more than $9.1 billion to more than 698,000 customers while 71% of loans are fully automated.
Upstart is among those online lending platforms that applied AI to the multi-trillion-dollar credit industry. With the help of artificial intelligence, Upstart has crafted an income and default prediction model. This statistical model is designed to learn the creditworthiness of a potential borrower. It has gone beyond FICO and used non-traditional variables such as education and employment in addition to your credit history to impart easy access to credit. Upstart holds the mission to enable its customers to have access to effortless credit based on true risk.
How Upstart Works
Upstart loan application process works simply and works like other online lenders.
- Check Your Rate
First of all, you have to check your rate by filling in an online form. You will be asked certain questions about your desired borrowing amount, approximate credit score, the highest level of education, primary income source, personal information, residential information, and financial information. You can check your rate is 5 minutes whether you are approved or not.
- Verify Your Information
If you get approved, you will have an estimated rate with details like interest rate, origination fee, etc. If you want to continue with Upstart’s provided offer, you have to provide more information. At this stage, you have to put your official documentation such as your test scores, pay stubs, tax forms, etc. Upstart will also do a soft credit check. Rest assured, it won’t damage your credit score.
- Get Your Money
After all the documentation check by an underwriter, you will get an official Upstart loan offer. On acceptance, your loan will be funded.in only 1 business day after signing.
Upstart loan borrowers must qualify for the following.
- U.S citizen or a permanent resident in the United States
- Minimum age limit: 18 years except for Alabama and Nebraska where the minimum age limit is 19 years
- Legal email account
- Real name, date of birth, and SSN (social security number)
- Source of regular income
- Personal bank account with U.S routing number
- Conform to minimum credit score i.e. 580
Upstart offers a soft credit check when you check your rate. It won’t hurt your credit score. Upstart will do another credit inquiry i.e. hard credit check when you accept your rate.
Upstart offers loans from $1,000 to $50,000 for a flexible period of time that ranges from 3 years to 5 years, and the APR varies from 7.86% to 35.99%.
Fast funding is ensured with Upstart as it provides 99% quick loans which are sent just in 1 business day after signing while education loans take 3 business days.
No Prepayment Penalty
Upstart loan borrowers can pay their loans at any time as there is no prepayment penalty.
There is an automatic application process for most Upstart borrowers, and they don’t have to submit any additional supporting documents. It might take just one page for the application process.
New to Credit Borrowers
Upstart values its customers more than their credit score. That is why it is keen to help those who are new to credit. This promising lending platform serves people with short credit history.
Upstart believes in transparency, and to keep everything transparent, Upstart is open to communicate about the application process, fees, rates, and monthly payments. You have access to a help center for loan information. In this way, you will go through all the information before accepting your Upstart loan.
Upstart knows the importance of customer support. Customer care is available throughout the loan process. The upstart team is present 7 days a week to answer your questions and keep you relaxed.
Upstart uses AI, machine learning, and alternative data including payment history for rent, utilities, and cell phones to provide the borrowers better opportunities to get approved with lower interest rates.
Upstart follows the global standards of W3C (World Wide Web Consortium). The purpose is to impart compatible content for computer-based technologies and operating systems. The users are recommended to use the latest version of a web browser.
Upstart is eager to educate its customers to grow their consumer lending business. For this purpose, Upstart has developed a knowledge hub to help you with webinars, blogs, case studies, and more.
Products offered by Upstart fall under two categories:
- Upstart Borrowing (Upstart Loans)
- Upstart Investing
Upstart Loans Review
Upstart loan products are of different types. In our Upstart loans review, you will get a grasp of all of them.
Upstart Personal Loans allow borrowers to get an unsecured loan for any occasion. The borrowers get loans that are not secured by property in 1 business day except the education-related loans which take 3 business days. The Upstart personal loans are fair and fast and you can get from $1,000 to $50,000 for 3 to 5 years. However, the minimum loan amounts depend on in which state you are currently living while the exact loan amount is determined by the information you provide in your application. When you check your rate the soft credit inquiry does not lower your credit score, but once you accept your rate and proceed with your application, a hard inquiry is done and it may impact your credit score. The interest rates for Upstart personal loans are fixed but Upstart will underwrite your loan. It means individual rates depend on different factors such as education, area of study, work experience, and credit history. Your future potential is also considered by Upstart and they do it by focusing on your educational institution, grade points, and your major. These rates differ between 7.86% to 35.99%. You should consider the APR of each loan product when shopping for loans.
Upstart personal loans include:
- Credit Card Consolidation Loans
- Debt Consolidation Loans
- Home Improvement Loans
- Medical Loans
- Wedding Loans
- Moving Loans
- Credit Card Consolidation
A credit card consolidation differs from a credit card settlement. A credit card settlement can harm your credit, but a credit consolidation loan is a safe form of personal loan to get rid of your credit card debt.
Upstart offers a credit consolidation loan to help you pay off your outstanding credit cards. Then you have to make just one monthly payment against your consolidation loan.
Nevertheless, credit card consolidation loans do not suit to fulfill everyone’s needs. These loans are best for those who have to pay the balance on their card(s) for most of the year e.g. 10 out of 12 months, or if you are unable to pay minimum payments or the interest rates on your credit card(s) are too high to pay off.
How to Apply
- Submit details about your income or credit history
- If you qualify, you will have different offers with distinct APRs, lengths, and monthly payments
- After final approval, you will get the loan within one business day
- Debt Consolidation Loan
Another Upstart personal loan product, Debt Consolidation Loan allows you to eliminate your debts with one simple monthly payment and without any teaser rates. With this loan option, you can combine the high-interest debt into one easy-to-manage personal loan. A debt consolidation loan can develop your budgeting habits by helping you pay different debt types like general credit cards, retail credit cards, gas cards, payday loans, and title loans.
How Debt Consolidation Works
- Home Improvement Loan
Home improvement loan is another product of Upstart personal loan. With home improvement loans, you can have competitive interest rates and reliable monthly payments to cover unexpected home expenses with a fast and easy process. Some uses of a home improvement loan are:
- Kitchen remodeling
- Bathroom additions
- Expanding a room
- Building a guest house
- Replacing the roof
- New carpets or hardwood floors
- Solar panels
- Home insulation
How to Qualify
Upstart considers the following details to decide about your home improvement loan qualification
- Personal information
- Annual income
- Education history
- Any loan taken out in the past three months
- Your savings and investment accounts
- Your expected borrow amount
- Medical Loan
Upstart personal loan funds your emergency or urgent medical expenses and lets you focus on your medical treatment. An average Upstart medical loan is $5,914.45 and it is to pay your out-of-pocket health costs whether they are unexpected bills, or planned medical procedures.
Here are some elective procedures for which you can use an Upstart personal loan.
- Infertility treatment
- Cosmetic surgery
- Orthodontics, veneers, or Invisalign
- Hair loss/hair replacement
- Weight loss, gastric bypass
- Wedding Loan
A wedding loan is another type of Upstart personal loan. wedding loan helps you meet your wedding expenses. The average wedding loan amount is $10,163.78, and the term period is 3 to 5 years. You can use the loan for various wedding day spendings like vendors, venue deposits, hotel blocks, wedding rings, attire, travel arrangements, special event liability insurance, honeymoon, and much more.
To fund your big day, you need to provide the following information on your online application form.
- Your desired amount
- Personal information
- Education level
- Income type
- Savings and investments
- Moving Loan
Another loan product by Upstart is a relocation loan to let you accommodate your moving costs. The average moving loan offered by Upstart is $4,902.11. You can make your security deposits or payments to movers.
Upstart Personal Loans Pros and Cons
- Fast funding in 1 business day
- No prepayment penalty
- Welcome borrowers new to credit
- Lower rates
- Application process is simple and easy
- Use artificial intelligence (AI) to measure risk
- Education history, major subjects, and job history are considered
- The borrowing term is limited to 5 years
- Origination fee
- Cosigners option is not available
Upstart Investing Review
Upstart provides digital lending powered by artificial intelligence (AI). The banks can improve their portfolio performance and welcome more and more borrowers.
Upstart Investing Products
- Consumer Lending Platforms
Upstart’s Consumer Lending Platforms expand to personal loans and auto loans.
- Smarter Personal Loans
As a lending partner of Upstart, you can offer a smooth digital experience, higher experience, and lower loss rates to your personal loan borrowers through Upstart’s Consumer Lending Platform enabled by artificial intelligence (AI).
- Accelerated Auto Loans
Upstart offers its Consumer Lending Platform for quick auto loans. Now, you can maturate your auto lending portfolio with an artificial intelligence-backed platform.
How It Works
Upstart offers a real digital experience as the users can complete their applications quickly.
- Credit Decision
Upstart’s AI model values borrowers within your credit criteria enabling higher approvals.
- Fraud and Verification
Application information is verified and certain documents are required to avoid any fraudulent users.
On the Consumer Lending Platform, the signature procedure is digital and carried out same-day.
- NPS (Net Promoter Scores)
- Manage risk
- Drive growth
- Improve efficiency
- Credit Decision API
Credit Decision API will enhance your lending creditworthiness. By providing true digital experience and loan origination process to your customers thru AI underwriting technology, you can offer them instant credit decisions for auto, personal, and student loans.
How It Works
Customers apply for loans and Upstart’s secure API application data is passed to Upstart.
- Credit Decision
Upstart considers bank’s credit policy while imparting 1600+ data points, returns, risk-based pricing, and term options.
Loans are originated with a clear display of fees and term options.
Upstart Powered Banks and Credit Union
- tcf bank
- First Federal Bank of Kansas City
- First National Bank of Omaha
- Customers Bank
- Ridgewood Savings Bank
- Kemba Financial Credit Union
- Apple Bank