LendingClub is one of the prominent players in the online lending industry, offering personal loans to individuals seeking financial assistance.
LendingClub offers personal loans, including syndicated loans, to borrowers with good and fair credit, subject to an origination fee.
List of key information
|Minimum credit score||600|
|APR||9.57% – 35.99%|
|Loan Amount||$1,000 to $40,000|
|Repayment Time||2 to 5 years|
|Fees||Origination fee： 3% to 8%,|
late fees：The greater of $15 or 5% of the unpaid amount
|Approval Time||2 business days|
|Loan Availability||Loans available in all 50 states and Washington, D.C|
Where LendingClub personal loans stand out
Competitive Rates: Borrowers with good to excellent credit scores can benefit from competitive interest rates, potentially lower than those offered by traditional banks.
Co-Loan Option: LendingClub allows co-loan applications. Applying for a personal loan with a co-borrower with good credit may increase your chances of qualifying and getting a lower interest rate or a larger loan amount. This can be especially helpful if you’re consolidating high-interest credit card debt.
Option to select and change repayment date: Borrowers can select a repayment date before signing the loan agreement and change the date during the repayment process. For example, pay date flexibility can be helpful if you change jobs and get paid on different dates.
Flexible Loan Terms: With options for loan amounts ranging from $1,000 to $40,000 and repayment terms of 24 or 60 months, LendingClub provides flexibility to cater to various financial needs and preferences.
Quick Approval: The relatively quick approval process ensures that you can access funds when you need them most.
Where LendingClub personal loans fall short
Origination Fee: The origination fee, which can range from 1% to 6%, can eat into your loan amount, making it important to factor this cost into your financial planning.
No mobile app for managing loan payments: Unlike some other online lenders and banks, LendingClub does not have a mobile app where borrowers can view the amount they owe, their next payment date, and other loan information.
What qualifications do you need to get a loan?
- Credit Score: LendingClub typically requires a minimum credit score of 600 to be eligible for a loan. However, to secure the most competitive interest rates, a higher credit score is advisable.
- Income: LendingClub assesses your income to ensure that you have the means to repay the loan. While there’s no strict income requirement, a steady source of income is crucial.
- Credit History: A positive credit history, free from recent bankruptcies or delinquencies, can improve your chances of approval.
- Debt-to-Income Ratio: LendingClub evaluates your debt-to-income ratio, which should ideally be below 40%. This ratio reflects your ability to manage your existing debts alongside the new loan.
- U.S. Citizenship or Permanent Residency: You must be a U.S. citizen or a permanent resident to qualify for a LendingClub loan.
- Age: You must be at least 18 years old to apply for a loan.
- Bank Account: You need an active bank account to receive your loan funds and make repayments.
It’s crucial to note that meeting these qualifications does not guarantee approval, and LendingClub’s decision is based on a holistic assessment of your financial profile.
Before you apply
– Check Your Credit Score: Obtain a copy of your credit report and review your credit score.
- Related Reading: How to Get a Free Credit Score
– Gather Necessary Documents: Be prepared to provide documents and information to support your loan application. This may include recent pay stubs, tax returns, bank statements, and proof of identity.
– Understand the Costs: Familiarize yourself with the potential costs associated with a LendingClub loan, including the interest rate and origination fee. Use LendingClub’s “Check Your Rate” tool to get an estimate of the interest rate you may receive without impacting your credit score. Use LendingClub’s online loan calculators to estimate monthly payments and see how they fit into your budget.
– Consider Your Co-Borrower Options: If you have a co-borrower with a stronger credit profile, you may have a better chance of securing a loan with a lower interest rate. Discuss the possibility of applying for the loan with a co-borrower if it makes financial sense.
- Related Reading: What Is a Co-Signer
– Have a Repayment Plan: Develop a solid plan for repaying the loan. Ensure that making the monthly payments won’t jeopardize your financial stability. Consider setting up automatic payments to avoid late fees.
- Related Reading: How to Create a Debt Repayment Plan in 6 Steps
– Compare Loan Offers: Don’t limit yourself to just one lender. Compare loan offers from multiple lenders, including traditional banks, credit unions, and online lenders like LendingClub. Compare interest rates, fees, loan terms, and eligibility requirements to find the best fit for your needs.
- Related Reading: Compare several personal loans
- Related Reading: Credit Union Loans Offer Low Rates and Flexible Terms
- Related Reading: Personal Loan Using Collateral
– Consider Alternatives: Explore alternative solutions to your financial needs, such as borrowing from friends or family, using a credit card, or seeking assistance from nonprofit credit counseling agencies.
How to Apply
Applying for a personal loan through LendingClub is a straightforward process.
- Check your rates: Like many online lenders, LendingClub allows potential borrowers to check available APRs before formally applying. To begin the process, applicants will need to provide their name, income, home address and contact information. This can be done online and involves only a soft credit inquiry, so it won’t affect the applicant’s credit score.
- Select an offer: The online tool then offers a variety of loan offers, including a variety of loan amounts, interest rates, APRs, monthly payments and loan terms that can be adjusted by the customer. Potential borrowers can then choose a loan structure that suits their borrowing needs and budget.
- Confirm Personal Information: After selecting a loan option, borrowers must provide their Social Security Number (SSN) and income and employment information. Once verified, the applicant can agree to the loan disclosure and add relevant banking information. If any additional information or documentation is required, LendingClub will update the applicant’s online dashboard.
- Waiting for Confirmation and Funding: Once a borrower’s application is completed and information verified, LendingClub searches its marketplace for investors to complete a financing match. LendingClub conducts a rigorous credit inquiry and loan funds are sent directly to the borrower’s bank account in approximately five business days. Alternatively, funds can be sent directly to third-party creditors for debt consolidation.
- Start making payments: The best way to pay for your LendingClub loan is through automatic transfer. However, payment can also be made by check, phone or wire transfer. An approved borrower’s first loan is due one month after loan funds are disbursed.
Fees and Approval Time
In terms of approval time, LendingClub generally provides a quick response to loan applications. You can expect to hear back within a few business days, making it a suitable option for those in need of prompt financial assistance.
LendingClub is a reputable online lender that offers personal loans to individuals with good to excellent credit scores. With competitive interest rates, flexible loan terms, and a relatively quick approval process, it can be an excellent choice for borrowers looking for financial assistance for various purposes, such as debt consolidation, home improvement, or unexpected expenses.
Before applying, take the time to shop around and compare loan offers from different lenders to ensure you’re getting the most favorable terms.
If you meet the eligibility criteria and have a solid credit history, LendingClub can be a convenient and reliable choice for your borrowing needs.
Frequently Asked Questions
Is LendingClub a safe and legitimate lender?
Yes, LendingClub is a legitimate and well-established online lender. It is publicly traded on the New York Stock Exchange and has been operating since 2007.
How long does it take to receive funds from LendingClub?
Typically, once your loan is approved, it takes a few business days for the funds to be disbursed to your bank account.
Can I use a LendingClub personal loan for any purpose?
Yes, LendingClub loans are generally unsecured personal loans, meaning you can use the funds for various purposes, such as debt consolidation, home improvement, medical expenses, or other personal needs. Of course, every loan platform does not allow loans to be used illegally.
What happens if I miss a payment with LendingClub?
If you miss a payment, LendingClub may charge a late fee, and it can also negatively impact your credit score. It’s important to make timely payments to avoid these consequences.
Can I pay off my LendingClub loan early without penalties?
Yes, LendingClub allows borrowers to make early loan payments without incurring prepayment penalties. This can be a great way to save on interest costs if you have the means to pay off your loan ahead of schedule.