NerdWallet rating: 5.0 / 5.0
Good for: Bad credit
Ascend targets borrowers with bad credit who intend to improve it. An Ascend personal loan is a good fit for those who:
- Have low credit scores mainly because of a one-time financial shock or because they’re new to credit. The company says it aims to lend to people whose credit scores have suffered but are on the path to rebuilding their finances.
- Have at least one year of credit history.
- Own a vehicle outright and are willing to pledge its title in return for a lower rate. Ascend says the value of the car doesn’t matter. (But be aware that if you don’t make your loan payments, you could lose the vehicle.)
- Are committed to an ongoing plan to pay down debt, reduce credit card spending and build savings.
- Live in one of the eight states served by Ascend: Alabama, California, Georgia, Illinois, Missouri, Oregon, South Carolina and Utah.
The average Ascend borrower has:
- A 630 credit score.
- A $6,000 loan at 33% APR (well-qualified borrowers have an average APR of 28.6%).
- Income of $89,000.
- A debt-to-income ratio of 28%.
Detailed Ascend personal loan review
To review Ascend, NerdWallet collected more than 30 data points from the lender, interviewed company executives, viewed the online loan application process with sample data, and compared the lender with others that seek the same type of customer or offer a similar product.
Ascend gives poor-credit borrowers a chance to prove they’re financially responsible and then lowers their interest rates in response.
Once you qualify for an Ascend personal loan, you can choose to lower your interest rate in one, or more, of four ways:
- Pay down debt.
- Reduce credit card spending.
- Build up savings.
- Pledge your auto title as collateral, which will directly reduce your interest cost by 20%. You will need to have insurance coverage on your car, even if you own it.
Borrowers are eligible for reductions in interest rate only after they have made three consecutive on-time payments. Ascend regularly scans your credit reports and bank account and lowers the monthly payment for behavior it views as positive.
The idea is to instantly reward borrowers for being responsible, much like Progressive does in the world of auto insurance, says Steve Carlson, co-founder and CEO of San Francisco-based Ascend.
More than 60% of borrowers choose to enroll in the rewards program, and 70% of these borrowers earn a lower payment. On average, these borrowers will save $300 over the life of the loan, Carlson says. Someone who maxes out every reward could cut the interest rate in half.
Ascend’s starting interest rate of 27% is much higher than other online lenders’, because it caters to poor-credit borrowers. Similar lenders — such as Avant, LendingPoint, OneMain Financial and Peerform — have lower interest rates but don’t allow borrowers to reduce them over the life of the loan. Some online lenders, such as LightStream and Pave, reward certain purposes with lower rates, but they serve only borrowers with good credit.
Ascend doesn’t consider applicants with credit scores of 700 or above, according to the company. That’s because those with higher credit scores have a better chance of finding a lower rate at other lenders that cater to good credit.
As of January 2017, Ascend is available in:
- South Carolina.
How to apply
Create an account on Ascend’s website with some basic information, including your Social Security number. Ascend conducts a soft check on your credit, which doesn’t affect your score, to see if you pre-qualify for a loan:
If you’re approved, you can compare the rewards loan with a regular, fixed-rate loan and choose the one you want. You’ll need to fill out a detailed application, which includes documents to verify your identity and income:
For a rewards loan, you will also need to connect your bank account to allow Ascend to monitor your saving and spending habits. Ascend conducts a hard credit check just before you receive your money, pulling information from credit bureau TransUnion (it also reports loan payments to TransUnion):
If you make on-time payments for three months, you are eligible for monthly rewards, which you can see on a dashboard:
The auto-title pledge option is also available if you call the company:
Minimum requirements for an Ascend loan
- Minimum credit score: 580, but borrowers’ average is 630.
- Minimum gross income: $35,000, but borrowers’ average is $89,000.
- Minimum credit history: 1 year.
- Maximum debt-to-income ratio: 41%, but borrowers’ average is 28%.
Ascend’s lending terms
- APR range: 27.49% to 35.99%.
- Minimum loan amount: Varies by state, starting from $2,000.
- Maximum loan amount: $12,500.
- Loan duration: 3 years.
- Time to receive funds: 1 to 3 business days.
Ascend’s fees and penalties
- Origination fee: None.
- Prepayment fee: None.
- Late fees: Varies by state after 15-day grace period.
- Personal-check processing fees: None.
- Other fees: Insufficient funds fee varies by state.
Before you take a personal loan
Consider all your options. If you are consolidating debt, you may be able to get a better rate with a co-signed personal loan. A homeowner might be able to get a home equity line of credit. You’ll still want to compare other bad-credit lenders.
Check your credit and know your financial strengths. In addition to your credit score, lenders also look at the length of your credit history, your income and other debts. High debt might negate a great credit score, for example, or high income could bolster a low score.
Learn how personal loans work. You’ll need to give lenders certain personal information to verify your identity and income and check your credit.
Calculate payment scenarios. Consider how the payments might fit into your monthly budget. Run the numbers on different loan amounts and interest rates to see how they’d affect your spending patterns.
Build your credit. A higher score will give you access to more financial products at lower rates.
Other lenders to consider
Poor Credit (580 Min)
Poor Credit (580 Min)
Personal Loans Ratings Methodology
NerdWallet’s ratings for personal loans awards points to lenders that offer consumer-friendly features, including: soft credit checks, no origination fees, payment options, short time to funding, interest rate caps of 36%, and absence of prepayment penalties. Features are considered for their positive impact on consumers’ credit history and financial health. To ensure accuracy and consistency, our ratings are reviewed by multiple people on the NerdWallet Personal Loans team.
— Among the very best for consumer-friendly features
— Excellent; offers most consumer-friendly features
— Very good; offers many consumer-friendly features
— Good; may not offer something important to you
— Fair; missing important consumer-friendly features
— Poor; proceed with great caution