Co-signed and joint loan options: LendingClub allows for joint and co-signed loan applications. With a joint loan application, the two borrowers combined debt-to-income ratio must be under 35%.
Accessible to most borrowers: This lender only requires a minimum credit score of 600 in order to qualify.
Soft credit pull: LendingClub allows you to check your rate through its website. You can view your rates with a soft credit pull. This doesn’t impact your credit score. LendingClub does conduct a hard credit pull once a loan is issued.
Origination fee: An origination fee of 1 to 6 percent of the loan amount.
Limited-term lengths: Borrowers can choose a three- or five-year loan repayment term. This doesn't give you the option to choose a shorter term and pay less interest, or a longer one to lower your monthly payments.
Expensive Loan: With a minimum APR of 10.68% and a 1% - 6% origination fee LendingClub loans can end up being pretty expensive.
LendingClub offers personal loans of $1,000 to $40,000, with fixed annual percentage rates ranging from 6.95 to 35.89 percent. LendingClub partners with banks on lending decisions. Some of the factors they consider are as follows:
- Credit score/history
- Debt-to-income ratio.
- Desired loan amount.
- Repayment term (36 or 60 months).
- Any amount owed to other creditors
In order to be eligible, borrowers must have a minimum of 36 months of credit history. Borrowers must also have a Debt to Income ratio below 40 percent. This means your total monthly debt obligations cannot add up to more than 40 percent of your monthly gross income.
LendingClub has a few other basic eligibility requirements. To qualify, borrowers must:
- Be at least 18 years old.
- Be a U.S. citizen, permanent resident or long-term visa holder.
- Have a valid bank account.
- Not eligible in Iowa or the U.S. territories.
LendingClub works by connecting investors with potential borrowers. They charge an origination fee of 1 percent to 6 percent for this service.
The origination fee is taken out of the loan proceeds upfront. An example of the origination fee is as follows:
Say you borrow $10,000 with a 5 percent origination fee, you’ll only receive $9,500. Be sure to factor in the origination fee when calculating the total amount you want to borrow.
There are no prepayment penalty or fees with Lending Club, but other fees may apply:
- $15 fee if you don't have enough money in your account to cover your monthly installment.
- A late-payment fee of either 5 percent of the unpaid installment amount or $15.
LendingClubs application process is unique because they are a peer-to-peer lender.
Applying for a loan can be done on LendingClubs website. At this point you will be asked for some information to determine if you qualify:
- Loan purpose
- Loan amount
- Whether you’re on your own or with a cosigner
- Information about your co-borrower, if you have one.
- Your date of birth.
- Your total annual income.
- Personal information like your name, home address, and email address
- Social security number (to perform a soft credit check)
Using that information, LendingClub will then provide a breakdown of the amount you can borrow, the APR, monthly payment, origination fee, and loan term.
If you like the offer from lending LendingClub and want to move forward, you’ll now need to provide a few more details for an official application:
- Whether you rent or own your home.
- Phone number
- Employment situation
- Employer name and address
At this point, LendingClub performs a soft credit check, a soft credit check does not affect your credit. After the soft credit check, a pool of investors will review your loan and decide whether they want to fund it. Before completing your loan, LendingClub will conduct a hard credit check, which can adversely impact your credit score.
With LendingClub you can expect to receive your loan in as little as four days. After being approved by the investors, your funds will be deposit into your account, at which point your interest will start accruing.
You have the option to back out of your loan within 5 days of accepting the loan.
LendingClubs customer service is available Monday through Friday from 5 a.m. to 5 p.m. pacific and 8 a.m. to 5 p.m. pacific at (888) 596-3157.