This peer-to-peer lender is an established source for loans up to $40,000.
finder.com’s rating: 3.8 / 5.0
|Product Name||LendingClub Personal Loan|
|Min Loan Amount||$1,000|
|Max. Loan Amount||$40,000|
|APR||6.16% to 35.89%|
|Interest Rate Type||Fixed|
|Minimum Loan Term||3 years|
|Maximum Loan Term||5 years|
|Requirements||US citizen or permanent resident, verifiable bank account, steady source of income, be 18+ years old.|
- No prepayment penalties
- Flexible loan terms
- Fast and easy application
- Unavailable to Iowa residents
- Higher rates for poor credit borrowers
- Check processing fee of $7 per payment
- A United States citizen or permanent resident, or living in the U.S. on a valid, long-term visa.
- At least 18 years old.
- The holder of a verifiable bank account.
First, do I qualify?
In order to qualify for a loan from LendingClub, you’ll need to meet some basic eligibility requirements.
- Have a credit score of at least 600
- Have a working bank account
- Be a US citizen or permanent resident
- Be at least 18 years old
Residents of Iowa and West Virginia are not eligible for a loan from LendingClub.
What makes LendingClub unique?
LendingClub is a peer-to-peer lender that uses investors — which can range from individuals to corporations — to fund its personal loan options. It is an industry leader that continues to set itself apart by providing personal loans to borrowers across the US. Since 2007, LendingClub has funded over 2.5 million loans and has been featured by both the New York Times and The Economist.
Your rates will be determined by a Loan Grade, which ranges from A to G. Depending on this grade, you’ll pay a loan origination fee ranging from 1% to 6% of the loan amount and an APR ranging from 6.16% to 35.89%.
How does a personal loan through LendingClub work?
Rather than funding a loan directly, LendingClub is a peer-to-peer lender with investors that can range from individuals to corporations. When you apply, you can check your rate and eligibility through a quick preapproval application that won’t affect your credit. If you receive preapproval, you can submit a full application and supporting documents.
When calculating your interest rate, LendingClub considers your “Loan Grade,” which is based on the information you supply in your application. Confirm the APR — the interest rate plus any fees you pay — you’re offered to get an idea of the true cost of your loan. If you’re fully approved for a loan, all you need to do is wait for investors to provide you with funds. After your loan is funded, LendingClub transfers the money to your bank account.
Payments are automatically deducted from your bank account monthly, but you can also pay by check, although there is a $7 fee for this option. You can partially or fully prepay your loan at any time without penalty.
What are the benefits of a LendingClub personal loan?
- Preapproval won’t impact your credit. You can apply with LendingClub without affecting your credit score. It will only be checked once you complete a full application.
- Fixed payments. LendingClub personal loans come with a fixed rate, which means you pay a consistent monthly payment for the term of the loan.
- Cosigners welcome. Not sure you can qualify for a competitive rate on your own? LendingClub is one of the few personal loan providers that allows you to apply with a cosigner to strengthen your application.
- Rebuild your credit. LendingClub reports your payments to the three major credit reporting bureaus so you can build up your credit history.
- Available in 48 states. LendingClub is available everywhere but West Virginia and Iowa.
- FDIC insured and SEC registered. Your account cash balance is deposited at Wells Fargo Bank, an FDIC-insured institution. It has also been registered with the US Securities and Exchange Commission since 2008.
What to watch out for
- Relatively long turnaround. It can take some time to get connected with investors: As few as 3 days. In comparison, some direct online lenders providing funds in as little as one business day.
- Origination fee. LendingClub personal loans come with an origination fee of 1% to 6% of the loan amount, which is higher than some other personal loan options. This amount is deducted from your loan before it’s transferred into your bank account.
- Poser scams. It’s possible that disreputable individuals could pose as lenders on LendingClub’s platform. Keep in mind that legitimate loans don’t require an upfront payment.
- Late fees. If you miss a payment due date, you could be hit with a fee of 5% of the unpaid installment or $15, whichever is greater.
Compare more personal loan providers
Is LendingClub legit?
Was LendingClub involved in a scam?Not exactly, but LendingClub hasn’t always followed the rules. There have been two major controversies surrounding LendingClub’s loans in the past few years.
The FTC complaint
In April 2018, the FTC filed a complaint against LendingClub over its “no hidden fee” promise, claiming that it had charged hidden upfront fees on several of its loans. LendingClub responded by pointing out that it clearly states that its loans come with origination fees multiple times, several places on its website and when borrowers apply for a loan.
LendingClub’s CEO resignation
In March and April of 2016, LendingClub’s founder and former CEO Renaud Laplanche stepped down after internal reports found that there had been about $22 million in loans sold to a single investor and failure to disclose possible conflicts of interest. Although this had a major impact on LendingClub’s credibility, the company itself took appropriate measures to prevent fraud and account for false revenue. Because LendingClub resolved the issue internally and continues to work at increasing the transparency of its policies, this was not a scam. Rather, it was a problem with a single individual that the company handled quickly.
What do customers say about LendingClub?
LendingClub gets mixed online reviews, though the majority are negative as of July 2018. It gets an A- rating from the Better Business Bureau (BBB), which it’s been accredited with since 2018. The BBB bases its ratings on factors like how a business handles customer complaints and advertising practices — not reviews.
Out of the 109 customer reviews on LendingClub’s BBB page, only 33 are positive. On top of this, 254 customers have filed a complaint against LendingClub with the BBB. It does even worse on Trustpilot, earning a low 3.4 out of 10 based on 12 reviews.
Several customers complained about a complicated application process, managing their loan online, and high interest rates. A few customers were also disappointed that they’d gotten a preapproval letter in the mail but were ultimately rejected. The handful of positive reviews were written by customers who said applying was simple and easy, however.
What do I need to apply?
To apply for a personal loan with LendingClub, you’ll need to meet general eligibility requirements.
- You must have a credit score of at least 600.
- You must have a valid bank account.
- You must be a US citizen or permanent resident.
- You must be at least 18 years old.
What are the steps to apply?
You can begin the application process by clicking the green Go to site button on this page.
- Enter your loan amount, your loan’s purpose and your estimated credit score before clicking Check Your Rate.
- Select whether you are choosing to apply alone of with someone else, then click Next.
- Fill out the required fields with your home address and annual income, clicking Next after each.
- If you’re preapproved, LendingClub will give you multiple loan offers. Select the offer that best fits your needs to apply for that loan.
- Follow the directions to fill out the rest of your application and submit any required documents. At this point, LendingClub will do a hard credit inquiry that will cause your credit score to drop a few points.
- Review, sign and submit your application.
- Wait for investors to fund your loan.
Once your loan is funded, you’ll typically receive the money directly into your account within four days. Overall, the whole process can take a week from start to finish.
I got a preapproval letter from LendingClub. What does it mean?
It’s not uncommon for lenders to send out promotional letters to customers they think might qualify. These include potential rates and terms, based on a soft credit pull that has no effect on your credit score. You might have gotten a letter from LendingClub that looks like this:
While it’s likely legit, there are also preapproval scams out there. Before you hand over your personal information, reach out to LendingClub to make sure it’s real. Didn’t get a letter? Follow steps below to get an estimate of your rates.
How to get preapproved step-by-step
Cover your medical expenses with LendingClub Patient Solutions
In addition to offering personal loans you can use for just about any expense, LendingClub also offers specialized medical loans directly through healthcare providers. These are designed to cover expenses that insurance usually doesn’t.
Through patient solutions, you have two options:
|Plan||Procedures it covers||Loan amount||APR||Terms|
|Extended plan||Weight loss, fertility, dental and hair restoration||$2,000 – $50,000||3.99% – 24.99%||24 – 48 months|
|True no-interest plan||Hair restoration and dental||$499 – $32,000||0% for the first 6 – 24 months, then 29.99%||Starting at 6 months|
There are no application, origination or prepayment penalties and you have a short grace period of three to seven weeks before your repayments start.
You can find a healthcare provider near you that offers LendingClub Patient Solutions on its website.
I got a personal loan from LendingClub. Now what?
Now it’s time to keep up on repayments. Luckily, LendingClub offers automatic prepayments on a fixed monthly schedule. This service eliminates the need worry about making the due date each month, just be sure you have money in your account. If your payment is not successfully completed, there is a $15 fee.
While you can pay by check, there is an additional fee of $7 per payment. If you would like to pay via your bank account, but not automatically, you can do so without incurring extra charges.
You have a 15-day grace period if you need to get your payment in a little late, but LendingClub encourages you to call or email as soon as you know you’re going to have trouble making a payment. If you don’t complete a payment within the 15-day grace period, the greater of either a fee of $15 or 5.00% of the installment amount will be assessed.
Compare LendingClub to its top competitors
|Prosper vs Upstart||Compare|
LendingClub could be a good fit for those with an established credit history who want an alternative to a bank loan. Keep in mind that you may still be faced with high APRs and that LendingClub doesn’t have the perfect record, so comparing your options is a must. However, with large loan amounts and good terms available, LendingClub is still a competitive option for borrowers.
Frequently asked questions
All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.95% to 35.89%*. The origination fee ranges from 1% to 6% of the original principal balance and is deducted from your loan proceeds. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at the time of application. The average origination fee is 5.49% as of Q1 2017. In Georgia, the minimum loan amount is $3,025. In Massachusetts, the minimum loan amount is $6,025 if your APR is greater than 12%. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months. Borrower must be a U.S. citizen, permanent resident or be in the United States on a valid long term visa and at least 18 years old. Valid bank account and Social Security number are required. Equal Housing Lender. All loans are subject to credit approval. LendingClub’s physical address is: LendingClub, 71 Stevenson Street, Suite 1000, San Francisco, CA 94105.† Per reviews collected and authenticated by Bazaarvoice in compliance with the Bazaarvoice Authentication Requirements, supported by anti-fraud technology and human analysis. All reviews can be reviewed at reviews.lendingclub.com.
Funding time is based on approximately 60% of borrowers who received offers through LendingClub’s marketing partners between January 1, 2018 to July 20,2018. The time it will take to fund your loan may vary.
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