LendingClub review: Personal loans starting at $1,000, with potentially lower rates if you add a co-borrower

LendingClub review: Personal loans starting at $1,000, with potentially lower rates if you add a co-borrower

LendingClub allows you to add a co-borrower to your application.

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Editor’s rating: 2.75 out of 5 stars

The bottom line: Personal Loans is a solid personal loan provider, especially if you have a lower credit score and want to add a co-borrower to boost your chances of a better rate. However, you could be charged high rates and fees compared to competitors. 

LendingClub personal loan amounts and interest rates

LendingClub loan amounts range from $1,000 to $40,000, and the minimum amount you’re required to borrow varies by state. LendingClub accepts loan applications from residents of all 50 states.

Depending on your credit score and other financial factors, your APR will range from Personal Loans, which is higher than some other major competitors’ APR ranges. For example, Best Egg’s APR range is Personal Loans, and Marcus by Goldman Sachs’ is Marcus Personal Loan. 

Pros and cons of LendingClub personal loans

Pros

Ability to add a co-borrower to your loan application. If you have poorer credit and are worried your loan might not be approved as a result of your standing, you can add a co-borrower and may qualify for a better rate.No prepayment penalty. You can make additional payments toward your loan, and you won’t be charged an extra fee.

Cons

Multiple types of fees. You’ll have to pay an origination fee between 1% to 6% of your total loan amount, and that fee will be baked into your loan APR. If your payment is more than 15 days late, you may be charged a late fee and other penalties. High maximum APR. Compared to competitors like Best Egg, Marcus, and Lightstream, LendingClub’s maximum APR of 35.89% is high. Best Egg’s max is 29.99% APR, and Marcus’ and Lightstream’s are 19.99% APR.Slower access to funds. You’ll get access to your funds within two to four business days, and while that is relatively fast, you can get funds deposited more quickly from other personal loan companies. 

Who is LendingClub best for?

LendingClub might be a good option for you if your credit isn’t in the best shape, because there is no minimum credit requirement. You can also borrow as little as $1,000 from the lender, so it could be an ideal choice if you only need a small loan amount. 

How LendingClub personal loans compare

Although rates depend on each borrower’s unique situation, Personal Loans’s interest rates are higher than those offered by other comparable lenders. Here’s how LendingClub stacks up to the competition.

Min. credit score

Unspecified

Min. credit score

660 recommended

Min. credit score

640

APR

Personal Loans

APR

Marcus Personal Loan

APR

Personal Loans

Origination fee?

Yes

Origination fee?

No

Origination fee?

Yes

LendingClub Personal Loan

Marcus Personal Loan

Best Egg

Both Marcus and LendingClub have no official minimum credit score requirements, but Marcus recommends a minimum credit score of 660 in an informational post on its website. Best Egg’s credit score floor is 640. Importantly, the lower your credit score, the higher an APR you will probably have to pay. 

Marcus won’t charge you any fees, including late fees. Instead, you’ll pay additional interest if you don’t pay on time, and your final payment will be more expensive. Both LendingClub and Best Egg will charge you a late fee of at least $15. The companies have nearly identical origination fees — LendingClub’s fee range is 1% to 6% of your loan amount, while Best Egg’s range is 0.99% to 5.99%.

Marcus offers an “on-time payment reward.” If you pay your loan on time and in full each month for one year, you are allowed to skip a month of payments, and interest will not accrue during that period. Marcus will then extend your loan by one month.

You’ll receive your funds slightly faster with Best Egg than with LendingClub. LendingClub says most customers will get their funds in two to four business days, and Best Egg states that the majority of customers will receive their money within one to three business days.

How LendingClub personal loans work

Personal Loans provides unsecured personal loans through either WebBank (Member FDIC) or LendingClub Bank, N.A. (Member FDIC), depending on where the loan application is submitted from. An unsecured personal loan doesn’t require any collateral, such as a house or car.

You can use personal loans from LendingClub for a variety of purposes, including debt consolidationhome improvements, and vacation. Loan terms are either 36 months or 60 months. Some amounts and term lengths might be unavailable in your state. You won’t pay a prepayment fee if you pay off your loan early. 

After the verification process is complete, your funds will be sent to your bank account typically within two to four business days. 

LendingClub has no official minimum credit score requirement, unlike some comparable personal loan companies. Still, the higher your credit score the more likely you are to get a low rate. 

If LendingClub grants you a loan with a high interest rate, you might consider credit cards for people with bad credit and compare rates between a card and a loan — you may qualify for a lower APR and better terms with a credit card. Weighing the pros and cons of your decision will help you get the best deal possible. 

Most loans from LendingClub are approved within one day, and you will likely receive your funds within two to four business days. 

You can reach LendingClub via a customer support email form, or by calling in Monday through Friday, 5:00 a.m. to 5:00 p.m. PT, or on Saturday from 8:00 a.m. to 5:00 p.m. PT. LendingClub has a Help Center with detailed answers to frequently asked questions, sorted by topic.

Is LendingClub trustworthy?

Personal Loans is a Better Business Bureau-accredited company, but LendingClub is currently not rated by the BBB, a non-profit organization focused on consumer protection and trust, due to a pending government action. The BBB evaluates companies by judging business’ replies to consumer complaints, honesty in advertising, and clarity about business practices. 

LendingClub does have a recent alleged scandal. In 2018, the Federal Trade Commission filed a complaint against the company for deceptive lending practices, including charging hidden fees, falsely leading customers to believe they’d be approved for a loan, and continuing to charge consumers who canceled their automatic payments or had paid off their loans entirely. LendingClub is also charged with withdrawing double payments from accounts and failing to provide consumers with privacy notices. The case is currently pending. 

Due to LendingClub’s recent history, you might prefer to use a different personal loan company.

Additionally, LendingClub informed the BBB that the company’s name is being used in an online loan scam. Some consumers are applying for loans on sites other than LendingClub and are being contacted by representatives who claim to be from the company. Those representatives ask for a fee before claiming to deposit loan funds, and oftentimes those funds are never received. To avoid any potential issues, make sure to double-check that you are on the correct website and understand that LendingClub does not charge an upfront application fee.

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