Editorial Review

Oportun Loans: 2019 Review

Opotun offers small loans at rates that are lower than payday loans, but still high. You may have cheaper alternatives.

Amrita JayakumarAugust 15, 2019

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Our Take

The Bottom Line: A no-credit-check loan for borrowers who need fast cash, but high rates make it an expensive option.

Oportun

Oportun

Min. Credit Score

None

Est. APR

20.00-67.00%

Loan Amount

$300-$9,000

Pros & Cons

Pros
  • No credit check or bank account required.

  • Fast funding.

  • Financial education and counseling available.

Cons
  • High rates.

  • Available in a limited number of states.

Full Review

To review Oportun, NerdWallet collected more than 30 data points from the lender, interviewed company executives and compared the lender with others that seek the same customer or offer a similar loan product. Loan terms and fees may vary by state.

When to consider: A last resort in a true emergency after you’ve exhausted other options.

Oportun is an online and storefront lender that makes small loans to low-income consumers with no credit history or bad credit due to limited credit history. Common reasons for getting a loan include paying for auto repairs, covering temporary cash shortages and paying off higher-interest debt.

Oportun calls itself an alternative to traditional payday lenders, which make quick, high-interest loans to borrowers with low credit scores and allow rollovers, often leading borrowers into a cycle of debt.

Oportun’s rates are lower than payday rates, it does not allow rollovers, and it emphasizes building credit with its loans. It considers borrowers’ income and expenses, and loan payments are typically around 5% of a borrower’s monthly income, says Sarah Livnat, vice president of communications and impact Oportun. That 5% threshold is recommended by consumer advocates as an upper limit of affordability for most borrowers.

Still, an Oportun loan is an expensive form of credit when you need quick cash. NerdWallet recommends exploring the alternatives outlined below before taking it.

Oportun loan details

Requirements:

  • Proof of identity.

  • Proof of regular income.

  • Have a verified address and phone number.

  • Live in one of the states that Oportun serves.*

Consumer-first features:

  • Certified Community Development Financial Institution.

  • Choose your payment date upon approval.

  • Offers financial education and access to financial counseling.

  • Rate reduction on subsequent loans.

  • Reports payments to Experian and TransUnion.

  • Allows co-signers.

Community focus: Oportun is a federally certified Community Development Financial Institution, which means its primary mission must be promoting community development. It must also provide financial education among other requirements.

How to qualify: Unlike payday lenders, Oportun does not require you to have a bank account when you apply, and nearly half of its customers have no credit score. You can choose to receive your loan funds by check or prepaid debit card or have them transferred to a bank account.

Oportun says it requires proof of income in the form of bank statements or pay stubs, and it checks databases that collect information on consumers with low credit scores. If you have a credit profile, the company factors in data from your credit report as well. If you cannot qualify for a loan based on your own income, you can use a co-signer.

The average Oportun borrower makes $40,000 a year and takes a loan of $3,400 at an annual percentage rate of 34%, according to the company.

Oportun loan example

A example loan for a first-time borrower in California is $500 with a repayment term of 7 months at 59% APR. That works out to:

  • Monthly payments: $86.

  • Total interest and fees: $103.

  • Total repayment: $603.

Oportun allows borrowers to choose a payment date, and it reports on-time payments to two of the three major credit bureaus, which can help your score. It also reports late payments — which can hurt your score —  and charges a late fee for missing payments.

How Oportun compares

Oportun’s rates are significantly lower than those of LendUpOppLoans and Rise, which issue loans with APRs that can hit triple digits.

All four lenders report borrowers’ payments to the credit bureaus to help build credit. LendUp and OppLoans report to all three major credit bureaus; Rise and Oportun report to two.

Rise and LendUp also allow borrowers to qualify for lower rates with successive loans through on-time payments or, in the case of LendUp, by watching financial education videos. You may be able to refinance into a larger loan at Oportun and get a lower rate if you’ve made on-time payments.

Oportun is not a good idea if you:

  • Are trying to build credit: Oportun offers a path to building credit, but a secured credit card, credit-builder loan or paying off existing debt are faster and cheaper ways to do so. Learn ways to build credit. If you don’t know your credit score, get a free score on NerdWallet.

  • Can get cash elsewhere:  NerdWallet recommends exhausting cheaper alternatives first, even in an emergency. Take the quiz below to explore your options:

Before you take an Oportun loan

  1. Exhaust all other options: If none of the alternatives listed above works for you, see if you can buy time from your creditor, work out a payment plan or face the short-term financial consequences of not paying, such as a late fee.

  2. Compare the cost of taking the loan to the cost of not taking it: Calculate the overall cost of not having funds for your purpose, then weigh that against the typical cost of this loan in your state.

If you take an Oportun loan

If you decide to take an Oportun personal loan, carve out room in your budget to pay the loan off to save on interest charges. Loans from Oportun are much cheaper than other payday alternative lenders, but they are still an expensive solution for your finances.

*Oportun has retail locations in nine states: Arizona, California, Florida, Illinois, New Jersey, New Mexico, Nevada, Texas, and Utah. Online loans are available to residents in Idaho, Missouri and Wisconsin.

Personal Loans Rating Methodology

NerdWallet's ratings for personal loans award points to lenders that offer consumer-friendly features, including: soft credit checks, no fees, transparency of loan rates and terms, flexible payment options, accessible customer service, reporting of payments to credit bureaus, and financial education. We also consider the number of complaints filed with agencies like the Consumer Financial Protection Bureau. This methodology applies only to lenders that cap interest rates at 36%, the maximum rate financial experts and consumer advocates agree is the acceptable limit for a loan to be affordable. NerdWallet does not receive compensation of any sort for our reviews. Read our editorial guidelines.