LendingClub vs. Upstart: Which offers better auto loans?
Key takeaways
- LendingClub may be best for borrowers who want to refinance without paying origination fees.
- On the other hand, Upstart could be a better choice for borrowers refinancing cars with high mileage.
- Both lenders have similar interest rates and loan amounts, so consider applying for prequalification to see which has the better deal.
Refinancing lenders LendingClub and Upstart cater to borrowers who may not meet traditional bank criteria. LendingClub offers lower overall rates and slightly more flexible terms, while Upstart matches borrowers with a network of partner lenders and is a good choice if you have bad credit.
Both lenders offer prequalification so you can check your rates and see which offers the better deal on refinancing your auto loan.
LendingClub vs. Upstart at a glance
LendingClub and Upstart offer similar loans, but Upstart is available in more states and accepts borrowers with poor credit.
| LendingClub | Upstart | |
|---|---|---|
| Bankrate score | 4.5 | 4.0 |
| Better for | Lower maximum rates |
|
| Loans offered | Auto refinance | Auto refinance |
| Loan amounts | $4,000–$55,000 | $3,000–$60,000 |
| APRs | 4.99%-24.99% | 6.89%-29.99% |
| Loan term lengths | 24–84 months | 24–84 months |
| Fees | Late fees may apply | Late fees may apply |
| Minimum credit score | 600 | 510 |
| State footprint | 42 states | 46 states |
| Time to funding | Up to 15 days | 14 days |
| Autopay discount? | Some lenders may offer | No |
| Refinancing restrictions |
Vehicle restrictions: Vehicles less than 10 years old and with fewer than 100,000 miles Loan restrictions: Loan balance of $4,000 to $55,000 and at least 24 months remaining |
Vehicle restrictions: Vehicles less than 10 years old and with fewer than 140,000 miles Loan restrictoins: Loan balance of $3,000 to $60,000 and at least 24 months remaining |
LendingClub auto loans
-
LendingClub is an alternative, direct lender that offers refinancing to borrowers with fair or better credit, and like many auto loan options, it does not charge origination fees. It also stands out because it offers loans of just $4,000. Even if you bought a less expensive car or have paid off most of your current loan, you can potentially lower your rate or monthly payment.
But if you are offered LendingClub’s max annual percentage rate (APR) of nearly 30 percent, look elsewhere. That’s well above the national average APR for even those with a deep subprime credit score.
Upstart
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Similar to LendingClub, Upstart only offers refinancing. Because it caters to borrowers with lower credit scores, it charges a high maximum rate of 29.99 percent.
Despite that, it may be a good fit for refinancing your auto loan. Its application process is powered by software and is largely automated. Upstart claims it considers more financial health factors than just your credit score. You may be able to qualify with a credit score as low as 510.
As with LendingClub, it may take up to two weeks to process and fund your application despite it being a fully online experience. By comparison, some competitors offer funding in a single business day.
How to choose between LendingClub and Upstart
Since both lenders offer prequalification, you can make your choice based on which lender offers better refinancing terms. Determine how much you have left to pay on your current auto loan. If it’s a smaller amount, then LendingClub will be your choice. For larger loans, both LendingClub and Upstart have similar products — though Upstart caters to borrowers with lower credit scores.
APR range
LendingClub’s auto refinancing rates range from 4.99 percent to 24.99 percent. Upstart has a higher range of 6.89 percent to 29.99 percent. While you aren’t guaranteed to get the minimum with either lender, someone with bad credit may want to start their refinancing search with LendingClub to avoid paying more interest than necessary.
Minimum credit score
LendingClub doesn’t have a minimum credit score requirement listed on its website. On the other hand, Upstart is upfront about its requirements and allows borrowers to refinance auto loans with credit scores as low as 510.
Repayment terms
When deciding between the two lenders, repayment terms aren’t a factor since both offer terms from 24 to 84 months. Instead, focus on your overall costs and monthly payments. When you refinance your auto loan, choosing a shorter loan term can help reduce the interest you pay, but it may result in a higher monthly payment if you don’t qualify for a lower APR.
Loan amount
Upstart is the better choice for borrowers who need a smaller or larger loan — it offers refinancing for amounts of $3,000 to $60,000. If you aren’t on either end of this spectrum, then both Upstart and LendingClub are both good choices with similar financing options.
Fees
Upstart and LendingClub charge the same late fees — 5 percent of the unpaid amount or $15, whichever is greater. However, if you’re looking for a lender that doesn’t charge origination fees, LendingClub is likely the better choice. Upstart’s auto refinance loans come with origination fees of up to $999, which can increase your borrowing costs.
The bottom line: Which is better?
Ultimately, LendingClub and Upstart offer similar products. Since both offer prequalification, you can check your refinance rates with both to see which will offer the better deal.
Compare more lenders before applying
Before applying for a loan with LendingClub or Upstart, it’s crucial to research and compare other lenders. Doing so can help improve your chances of getting the best deal for your unique financial situation.
