Upgrade Personal Loans: 2023 Review
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Upgrade personal loans come with multiple rate discounts and offer direct payment to creditors. This lender has a low minimum credit score requirement, making the perks stand out even more.
Pros & Cons
- Multiple rate discounts.
- Secured and joint loans.
- Mobile app to manage loan payments.
- Direct payment to creditors with debt consolidation loans.
- Long repayment terms on home improvement loans.
- Origination fee.
- No option to choose initial payment date.
Compare to Other Lenders
Full Review of Upgrade
Upgrade personal loans are good for borrowers with low credit scores looking to consolidate debt and build credit at the same time.
Though Upgrade lends to borrowers across the credit spectrum, the lender has looser minimum credit score, credit history and debt-to-income ratio requirements than lenders that seek borrowers with good or excellent credit scores (690 or higher).
Its softer borrowing requirements make some of its features — such as rate discounts, direct payment to creditors on debt consolidation loans and extra long repayment terms on home improvement loans — stand out even more. Such perks are rare among bad-credit lenders (that accept credit scores of 629 or lower).
» MORE: See your bad-credit loan options
Table of Contents
Upgrade personal loans at a glance
Minimum credit score
8.49% - 35.99%.
$1,000 to $50,000.
3 to 5 years. 7 years on some larger loans.
Time to fund after approval
Loans available in all 50 states and Washington, D.C.
- Disclosure from Upgrade
Personal loans made through Upgrade feature Annual Percentage Rates (APRs) of 8.49%-35.99%. All personal loans have a 1.85% to 9.99% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. Loans feature repayment terms of 24 to 84 months. For example, if you receive a $10,000 loan with a 36-month term and a 17.59% APR (which includes a 13.94% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $341.48. Over the life of the loan, your payments would total $12,293.46. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early. Personal loans issued by Upgrade's bank partners. Information on Upgrade's bank partners can be found at https://www.upgrade.com/bank-partners/.
Where Upgrade personal loans stand out
Multiple rate discounts: Upgrade offers more opportunities to lower your annual percentage rate than most of its competitors.
Autopay discount: The lender offers a 0.5 percentage point discount for setting up automatic loan payments. Some lenders offer an autopay discount between 0.25 and 0.5 percentage points. This is a low-effort way to lower your APR slightly.
Direct pay discount: For debt consolidation, Upgrade offers a rate reduction of 1 to 3 percentage points when you have the lender pay off your debts directly. You must have at least half the loan funds sent to other creditors to get the discount. Not all lenders offer direct payment to creditors, which simplifies the consolidation process, and a discount for using the feature is unique.
Rewards checking discount: Upgrade says customers with multiple Upgrade products (such as a checking account) may get up to 20% off of their personal loan rate. So if you qualify for a 30% APR, your rate could be as low as 24%.
» MORE: Compare debt consolidation loans
Secured and joint loans: Borrowers can get a secured or joint loan through Upgrade. These loan types may be easier to qualify for or come with a lower rate. Upgrade accepts a vehicle as collateral and says your secured loan rate could be 1 to 10 percentage points lower than an unsecured loan.
» MORE: Best secured personal loans
Mobile app and credit assistance: Upgrade has a well-rated mobile app where borrowers can manage loan payments. The lender also offers free credit score monitoring, a summary of your latest credit report, a credit score simulator and the ability to track your score history. Some lenders offer a mobile app, but credit report summaries and a score simulator are rare perks.
Longer repayment term for larger loans: Upgrade’s repayment terms of three to five years are common with personal loans, but the lender offers an additional seven-year repayment term for home improvement loans and loans over $30,000. Only a few lenders offer longer home improvement loan repayment terms.
» MORE: Best home improvement loans
Where Upgrade personal loans fall short
Charges origination fee: Upgrade charges an origination fee from 1.85% to 9.99%. The lender takes this fee from the loan amount before you receive the funds, reducing your total loan amount. Be sure the loan amount is still enough to cover your expense once the fee is applied. Origination fees can have a significant impact on the loan’s affordability because they increase your APR and may lower your loan amount or raise your monthly payments.
No option to choose payment date: When you get an Upgrade personal loan, the lender assigns you a repayment date. Many lenders let borrowers choose a repayment date that works best with their pay schedule. Instead, Upgrade borrowers can move their payment date within 15 days before or after their given due date. You can do this as often as you want in the app.
Do you qualify for an Upgrade personal loan?
Upgrade’s borrower requirements are softer than some other lenders — a minimum credit score of 560 is one of the lowest among personal loan lenders — but the average borrower has a higher credit score and relatively strong income.
Here’s what you need to be eligible to apply:
U.S. citizen or permanent resident, or living in the U.S. on a valid visa.
At least 18 years old in most states.
A verifiable bank account.
A valid email address.
Here’s what you need to qualify for an Upgrade personal loan. (Meeting these requirements doesn’t guarantee approval.)
Minimum credit score: 560. Upgrade uses FICO score version 9 from TransUnion.
Minimum number of accounts on credit history: One account.
Minimum length of credit history: Two years.
Maximum debt-to-income ratio: 75%, including mortgage and the loan you’re applying for.
Minimum annual income: None; this lender accepts income from a partner, alimony, retirement, child support, Social Security payments and other sources.
Here are details about Upgrade’s average borrower, according to the lender:
Average credit score: 672.
Average annual income: $80,000.
Average loan amount: $11,500.
Average loan term: Five years.
Most common loan purpose: Credit card refinancing and debt consolidation.
Before you apply
Calculate your monthly payments. Use a personal loan calculator to determine what APR and repayment term you’d need to get a loan with affordable monthly payments.
Make a plan to repay the loan. Review your budget to see how the loan’s monthly payments impact your cash flow. If you have to cut other expenses in order to repay the loan, it’s better to know that before you borrow.
Gather your documents. Upgrade may require proof of income, which can be a W-2, pay stubs or tax documents. Having these documents handy can speed the application process.
How to apply for an Upgrade personal loan
Here are the steps to apply for an Upgrade loan.
Pre-qualify on Upgrade’s website. Start by entering a loan amount and purpose on Upgrade’s website to get to the lender’s pre-qualify form. Next, choose a joint or individual application and provide basic information like your name, address, birth date and income. Finally, create an account with your email and a password and enter your Social Security number. There’s no hard credit inquiry at this stage.
Preview loan offers. Qualified borrowers are shown multiple offers, including loan amounts, rates, repayment terms and monthly payments. Choose the offer that fits your budget to start a formal personal loan application.
Finish applying. The application may require certain documents, like W-2s and pay stubs to confirm the information you gave during pre-qualification. Upgrade will also do a hard credit check when you apply, so your credit score will temporarily dip.
Get approved and receive your funds. It typically takes Upgrade one to a few business days to approve applications. The lender says it sends loan funds the day after approval. This process may take longer if you’re having Upgrade directly pay off other debts.
Make a plan to repay the loan. Upgrade reports payments to all three major credit bureaus, so on-time payments will help build your credit score, but missed payments will hurt it. Setting up automatic payments and keeping an eye on your budget are two ways to manage your loan payments.
Compare Upgrade to other lenders
Personal loan lenders offer different rates, loan amounts and special features, so it pays to weigh Upgrade against other options. The best personal loan is the one with the lowest APR and most affordable monthly payments.
Upstart and Best Egg are online lenders with similar borrowing requirements to Upgrade, and both are solid options for consumers with fair or bad credit scores (689 or lower).
» MORE: Compare personal loans
Upgrade vs. Upstart
Upstart provides an instant personal loan application decision and can fund a loan within one business day. Upstart offers similar rates to Upgrade, but may more easily approve borrowers with low credit scores or thin credit histories using its alternative data underwriting model.
Upgrade may be the better debt consolidation lender because Upstart doesn’t offer direct payment to creditors or debt consolidation discounts.
» MORE: Upstart personal loan review
Upgrade vs. Best Egg
Best Egg has slightly a slightly higher minimum credit score requirement and offers similar rates to Upgrade.
Best Egg provides a solid personal loan for large purchases and debt consolidation. Like Upgrade, Best Egg provides direct payment to creditors on debt consolidation loans, but doesn’t offer rate discounts or a mobile app.
» MORE: Best Egg personal loan review
How we rate Upgrade personal loans
NerdWallet writers rate lenders against a rubric that changes each year based on how personal loan products evolve. Here’s what we prioritized this year:
- Category definitions
Affordability (30%) An affordable loan has low rates and fees compared to other similar loans and may offer rate discounts.
Underwriting and eligibility (25%) The lender reviews borrowers credit reports and credit history, and tries to understand their ability to repay a loan, before making a final application decision.
Loan flexibility (20%) A flexible loan is one that lets users customize terms and payments. That means offering a wide range of repayment term options, allowing the borrower to change their payment date, offering loans in most states and funding it quickly.
Customer experience (15%) A good customer experience can include a fully online application process, financial education on the lender’s website and a customer service team that’s available most of the time and can be reached multiple ways.
Transparency (10%) A transparent lender makes information about the loan easy to find on its website, including rates, terms and loan amounts. Transparency also means allowing users to pre-qualify online to preview potential loan offers and reporting payment information with the major credit bureaus.
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NerdWallet’s review process evaluates and rates personal loan products from more than 35 technology companies and financial institutions. We collect over 50 data points from each lender and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high interest rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.