Flexible Options, but Relatively High APRs
Upgrade, an online fintech company, was launched in 2017. It offers a range of financial products including personal loans and credit cards. Upgrade also offers rewards checking accounts and credit monitoring services. Upgrade describes itself as a “mobile banking experience”. It has helped more than 500,000 people borrow more than $7,000,000 since its inception.
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The wide range of loan terms and loan amount options offered by Upgrade, along with the minimum credit score requirement at the top end of the “poor” category, allow for flexibility for borrowers. Customers who have Upgrade rewards checking accounts can receive a rate discount on personal loans and upgrade products. Upgrade’s loan APR (annual percent rate) is high compared to other competitors. Upgrade loans might not be right for everyone.
How to Get a Personal Loan?
Understanding how personal loans work is essential before you apply for one. Personal loans are issued as a lump sum, and repaid over a set period of time with fixed monthly payments. They are not like credit cards. There are two types of personal loans: unsecured and secured. Secured loans require you to pledge collateral such as your home or vehicle equity. If you default, the asset could be taken.
You should compare rates with different lenders before you apply for a personal mortgage. Pre-approval is offered by most lenders. This process requires only a soft credit check and won’t affect your credit score. Based on your credit information, you will get an estimate of the interest rate you would pay. However, your actual rate may change once you are formally approved. Comparing personal loan rates is a great way to make sure you don’t pay too much for a loan.
Alternatives to Personal Loans
Depending on your financial situation, one or more of these options may be better suited to your needs.
A home equity loan, or HELOC, is a loan that you can get if you have at most 15-20% equity in your house. Because they are secured by your home, these loans often have lower interest rates than personal loans. You should be aware that defaulting on payments could result in your losing your home.
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Balance transfer credit card card: If you are looking to consolidate your debt, you might be able transfer the balance to a card that has a 0% intro APR. This is only an option if the balance can be paid off during the introductory period (which typically lasts 12 to 18 months). If you don’t, the credit card APRs will be high on any balance remaining after the introductory period ends.
How do you Qualify for an Upgrading Personal Loan?
- The following requirements are required to obtain an Upgrading personal loan:
- You must be a U.S. citizen or permanent resident to enter the country.
- At least 18 years of age (19 in Alabama and other states).
- Verify that you have a bank account with a verified address and an email address.
Although Upgrade does not list a minimum credit score requirement, a representative from the company confirmed that you will need a minimum FICO score 560 in order to be eligible for a loan. When evaluating your application, the company will consider your credit score, credit usage and history. Upgrade allows joint applications if you feel your credit score is too low to be eligible for a loan at a reasonable interest rate. You may be able to qualify for lower rates and a larger loan amount if you apply with a coborrower who has a better credit score than yours. However, this comes with its own risks and pros.
Who should get an upgrade personal loan?
Like personal loans, upgrade loans can be used to consolidate debt or pay for large expenses. They can’t be used to finance post-secondary education, student loans, investing or gambling.
Upgrade is a great option for large expenses such as home renovations because of the long loan terms and high loan amounts. It is important to note that your creditworthiness may affect your ability to qualify for larger loan amounts. According to Experian credit bureau, Upgrade’s minimum credit score of 560 is considered to be in the upper range of “poor”. This allows for greater flexibility for borrowers with less than stellar credit. Upgrade offers auto secured loans, which use the borrower’s vehicle as collateral. This can be a great option for those who aren’t eligible for an unsecured loan at reasonable rates. Before you take out a secured loan, be aware of all the pros and cons.
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How to apply for an upgrade loan?
Here’s how you can apply for an Upgrade loan if you have decided that it is right for your needs.
Rates. Before you apply, you can view your rate on Upgrade’s site. Some personal information such as name, address, income will be required. Upgrade will conduct a soft credit review, but it won’t affect your credit score.
Select the offer you like. Upgrade will send you a list with loan offers, including the amount, term and rate, once you have submitted your information. Based on the information available, choose the offer that interests you.
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Accept the offer and provide the documents. After you accept the offer, you will need to provide certain documents that prove your income and identity. You will need to submit copies of your government-issued IDs, pay stubs and bank statements. Upgrade will give you a list of tasks to complete and documents to submit to complete your application. Your Upgrade account allows you to check the status of your application.
