Upstart Auto Refinance Loans: 2021 Review

To review Upstart, NerdWallet collected and compared more than 15 data points from the lender, interviewed company executives and compared the lender with others that seek the same customer or offer a similar product.

Upstart is an online lender that offers auto refinance loans, but not cash-out or lease buyout refinancing. Upstart is different from many lenders because it relies on artificial intelligence to evaluate and underwrite applicants. Upstart says this results in more approvals and better interest rates for consumers.

Upstart may be a good fit for those who:

• Have bad or little credit history. Upstart’s minimum credit score of 510 is lower than many lenders require. Upstart also says that it works with applicants with no credit history.

• Want to shop around. You can pre-qualify with Upstart to see what rate you might receive without affecting your credit.

• Live in an eligible state. Upstart auto refinance loans are currently available in Florida, Kansas and Wisconsin. An Upstart spokesperson said the lender is planning a nationwide expansion in 2021.

Refinancing your car loan may make sense if your credit has improved since you bought your car, if the selling dealer put you in a loan with a higher rate than you might have otherwise qualified for or if interest rates overall have dropped. In addition, you may be able to extend the term of the loan, helping to lower payments.

Upstart review details

Upstart was founded in 2012 and began refinancing auto loans in August 2020. Loans are currently limited to residents of Florida, Kansas and Wisconsin, but the lender plans to extend its reach nationwide in 2021.

Upstart may be a good choice if you have bad credit — generally a FICO score below 630 — or a limited credit history. Upstart considers non-credit factors, like your work history and education, when making lending decisions and says it accepts applicants with no FICO score whatsoever.

When refinancing with Upstart, you can keep your current repayment term or extend it by 12 months. The maximum term length is 72 months. NerdWallet generally doesn’t recommend loan terms longer than 60 months or extending your term, as you run the risk of owing more than the car is worth.

Upstart charges a 4.5% origination fee, which could also put you closer to being upside-down on your loan. This fee is added to your loan amount. For example, if you refinanced a $20,000 auto loan, your new balance would be $20,900. This type of fee is uncommon among auto refinance loans.

A spokesperson says Upstart's APR — which includes interest rate and origination fee — is often lower than other refi lenders. Be sure to look at the total cost when comparing loans.

» MORE: Best auto loan refinancing lenders

Upstart auto loan rates

Although Upstart works with bad- or no-credit borrowers, you will likely get the best rate possible if you have excellent credit.

If your credit is less than top-tier, your interest rate will be higher. This means your monthly payment will be more, and over time, you’ll pay more interest. If you know your credit score, you can get an idea of the rate you might qualify for.

Applying to Upstart

• Loan offers are good for up to 14 days.

• You are not obligated to accept an offer.

• You can check your rate in minutes online.

• No application fee.

• Origination fee of 4.5%; late fees of 5% of past-due amount or $15, whichever is greater.

• Does not allow co-applicants.

Upstart restrictions

• Maximum vehicle age: 10 years.

• Maximum vehicle mileage: 120,000 miles.

• Maximum loan-to-value ratio: 145%.

• Loan terms: Upstart will match your current term or let you add 12 months to it. The maximum term is 72 months.

• Upstart auto refinance loans are available only to residents of Florida, Kansas and Wisconsin. Upstart is planning a nationwide rollout in 2021, according to a company spokesperson.

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