11 Facts Before Taking A Personal Loan from Achieve or Upstart. Detailed Personal Loan Comparison.
We’re going to compare personal loans from Achieve and Upstart. We’ve spent years working in the lending industry and we track dozens of lenders. We want to break down these two lender so you can see which one might be better for your situation.
The first thing we are going to look at is the loan amounts that they offer. Achieve’s minimum loan amount is $5,000 which means that it probably isn’t where you will start if you just need a little money to cover a short-term emergency. Upstart will issue loans as low as $1,000. So, if you are looking for a little bit of money to cover a month’s shortfall, Upstart offers a little more flexibility on the low side. If you are looking for a more substantial amount of money, both Achieve and Upstart will lend as much as $50,000. For both of these lenders, it’s important to remember that the amount that they offer you will depend on your particular financial situation.
Loans from Achieve have terms between 2 and 5 years. Upstart’s terms range from 3 to 5 years. I am a little concerned about 3 years being the lowest term length. If you’re borrowing less than $3,000, you should try an avoid terms longer than 2 years. That’s just too long to be paying interest for what should be a small loan.
Upstart only offers unsecured loans, which means that you don’t have to put up any collateral to secure the loan. Achieve, on the other hand, offers unsecured loans, secured loans, and home equity loans. An unsecured loan means that the loan is not attached to any assets and the lender cannot come after your assets if you fail to pay. A secured loan means that if you fail to pay, the lender can come for the specific asset that you used as collateral. A home equity loan is usually a line of credit that is secured by the equity in your house. Defaulting on a home equity loan could lead to the lender to foreclose on your property.
If you can avoid it, it’s usually a good idea to stick with an unsecured loan so you aren’t putting your assets (like your motor vehicle) at risk in case you can’t pay the loan back. But, if done right, a secured option or taking out a home equity loan can help you get approved when you otherwise wouldn’t. So, it’s nice that Achieve gives you the option.
Now let’s look the cost of the loans. Achieve’s minimum APR is 8.99% and Upstart’s minimum is 7.80%. 7.8% is a great rate, but probably only about 10% of their applicants could expect to see a rate that low. Still, it’s lower than Achieve, so we will highlight that as a point for Upstart. Both of them have maximum APRs that cap out at 35.99%.
Achieve charges an origination fee that will be between 1.99% and 6.99%. Upstart’s origination fee ranges between no fee at all all the way up to 12%. Zero is a great number, but 12% is about as high as I ever see origination fees. Since we can’t be sure you will get a loan with no origination fee, I am going to give this category to Achieve since they have a much lower top fee. The origination fee is a percentage of the borrowed amount and comes out of the proceeds of the loan. So, if you borrow $10,000 and have a 5% origination fee, you will receive $9,500 but will still need to repay the $10,000. Remember that the origination fee is accounted for in the APR. The APR is the origination fee plus the interest rate. All things being equal, you want a lower origination fee if you plan on paying off your loan early. Paying off early will save you on the interest you would have paid, but you don’t get a reimbursement of the origination fee.
Both Achieve and Upstart target borrowers who have fair credit scores. Based on my research, I believe they lend to people with credit scores between 620 and 700. Of course, the lower you go down in their ranges, the less likely you are to be approved. These are guidelines. Lenders don’t usually use credit score to determine eligibility. They usually use information like payment history, debt-to-income ratios, utilization, income…stuff like that.
Achieve will accept a cosigner on their loans, but Upstart does not. A cosigner is someone who agrees to pay off your loan if you fail to repay it. If you can qualify for the loan that you need, there is little reason to entangle a loved one in the process. But, if you have a spouse or loved one that has a stronger credit profile than you do, add them as a cosigner might make all the difference in getting the loan you need. It’s good that Achieve offers this option.
If you are using the loan to consolidate credit card balances of other debt, Achieve will directly pay off those other creditors with the proceeds of the loan for you. Upstart, on the other hand, will. It’s convenient when a lender will do that, but it also shows that the lender knows that the loan will replace other debts and not stack on top of them. Because of that, the new loan won’t change your debt-to-income ratio. That should make it easier to be approved by them. Achieve focuses on debt consolidation and paying off debt, so it makes sense that they would offer this service.
Upstart does not offer any discounts that can lower the interest rate that you pay. But, Achieve offers several. You get an interest rate discount if you are using the loan to consolidate other debts as well as if you include a co-borrower, or cosigner. Perhaps most unusually, Achieve will also give you a discount if you show that you have some retirement savings.
If you are late on a payment, both Achieve and Upstart will charge either $15 or 5% of the late amount, whichever is higher. Most lenders will charge a late fee and these are pretty standard rates.
Achieve doesn’t have any other fees, but Upstart charges a $15 ACH return fee if you don’t have enough money in your account when they attempt to make an ACH draw your monthly payment. They will also charge you $10 if you want paper copies of the loan agreement, your bills, stuff like that. Achieve gets credit for not having any additional fees.
So let’s summarize what we’ve learned about personal loans offered by Achieve and Upstart.
Achieve absolutely wins most of the categories. They have tried to cater to people who are conscientious enough to want to pay off their debt. So, they have the features that would support them. This might also explain why they don’t lend less than $5,000; they are more focused with consolidating people’s debt than they are covering new financial emergencies. Even though Upstart doesn’t have many green cells, I don’t think they are a bad lender. And, really, the most important things for people looking for a loan are whether they can get the money they need and whether they can get it at the lowest possible price. If Upstart would give you the money you need at a lower cost, there’s no reason you shouldn’t go with them.
That’s why we always recommend that before you accept a loan, you should shop around. Find the best deal. At The Yukon Project, we’ve tried to make shopping around easy. If you visit our marketplace page, you can apply to any one of our other featured lenders. Behind the scenes, we will check your rate with up to 40 other lenders. Our partners use a soft credit check, so applying won’t hurt your credit score. We will show you all of the approved offers so you can pick the loan that’s best for you.
If you have any questions about either one of these lenders that we didn’t cover, leave a comment below and we will try and answer it. If you found this video useful, please like it and subscribe to our channel. Thanks for watching.
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