If you hunt around the internet for online loans (like so many millions of other Americans) then you are going to encounter a lot of repetition and quite a bit of disappointment. The majority of online lenders are state licensed companies that are internet only businesses and they offer some pretty expensive loans.
Right behind them are the hundreds of Native American lenders (all of which are online companies) and they are even more expensive than the state licensed firms. The main reason we have so many tribal lenders is because they do not have to conform to the rules and regulations that govern how state regulated lending companies operate.
Whether they offer installment loans or the far more common payday loans, all of these lenders leave much to be desired in their loan products. And if you have used bank loans (back before 2008 when unsecured lending still existed at commercial banks) then you will be especially upset at the rates and terms being offered with these online garbage loans.
However, there are a few companies that stand out from the crowd. If you have followed t his site for any length of time you know I am a big fan of Mobiloans and their line of credit loan that "only" requires a 10% interest payment every two weeks.
Another lender that is very interesting to me is LendUp. This company pitches three main offerings built into their loans which are declining interest rates, the opportunity for customers to build (or rebuild) their credit and free financial education.
It's the declining interest rates for customers, that is what we are looking for. The other parts, free financial education and building up a good credit history, those are nice aspects of LendUp but that's not the goal. We want good interest rates, meaning lower interest rates and specifically we want these rates to improve on the extremely high rates that many Native American lenders are charging.
Here is how the LendUp Lending Ladder program works...
The overall program is broken down into three parts, which are Silver, Gold and Platinum. You begin at Silver (unless you have stellar credit or a large monthly income that can be proved and confirmed) and after borrowing and successfully repaying the Silver loan you would then move on to the Gold loan which has a slightly higher dollar amount involved.
Once you repay the Gold loan you will now be eligible for the Platinum loan. This loan is different because it can be for a higher amount (up to $400) and the loan can be setup to repay as an installment loan rather than the typical payday loan where the entire loan is due on your next payday. One other interesting option for the Platinum loan product is the ability to select credit reporting. Most people who get payday loans are in need of a higher credit score, right? Goes with the territory of getting these high interest loans in the first place, if the customer had a better credit score they wouldn't be getting these low quality (expensive) loans in the first place.
While I am not thrilled with LendUp or their product offerings, I do have to reconsider this just a bit when it comes to the Platinum loan that gets reported to the big three credit reporting agencies. This is a rare service for any of these small-time lenders. For the interest cost on a $400 loan it may be worth it to get a Platinum loan, strictly just to repay it and get the bump up with Experian and the other credit agencies.
If you are planning on taking out a small online loan then you may want to consider asking LendUp for their Platinum program loan. They may want you to take out a Silver and/or Gold loan first, before even being eligible for the Platinum loan. But it can't hurt to ask. Getting an improved credit score is everything these days and there are not always great ways to get this done. Many people use a secured (or prepaid) credit card, but this is not quite as good as being granted a real loan. Consider the Platinum offering from LendUp.
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