LendingClub personal loans review

In a nutshell

Looking for a personal loan when your credit isn’t stellar isn’t easy. LendingClub makes it accessible for borrowers with fair-to-average credit to gain access to financing.

• LendingClub’s minimum required credit score is 600.
• LendingClub lets you change your payment due date, which can help you stay on top of your payments.
• LendingClub has existed since 2007 and has helped over 4.8 million customers access financial products that improve their lives.

The AP Buyline roundup: Might be good for borrowers with fair credit

LendingClub could be a solid choice if you have fair or average credit and need access to cash. Its flexible payment option is intended to help you stay on top of your payments; however, if your credit hovers in the lower ranges, expect to pay more in fees and interest. Be sure to shop around and make sure what’s best for you.

Who is a LendingClub personal loan for?

LendingClub is best for folks who want to borrow between $1,000 and $40,000 and use the proceeds from their personal loans for a number of reasons including debt consolidation, home improvement projects, covering moving costs, emergency medical bills or tidying them over during a cash shortfall, to name a few.

With a minimum credit score of 600, it’s geared toward folks with fair or good credit. (The current national average credit score is 717 as of Oct. 2023, according to data analytics company FICO). While borrowers with fair credit may qualify for a personal loan with LendingClub, those with high credit and a low debt-to-income ratio typically land the lowest interest rates and best terms.

Eligibility requirements for getting LendingClub personal loan

Here’s what’s required to secure a personal loan from LendingClub:

Citizenship

You’ll need to be a current resident or U.S. citizen from any of the 50 states and Washington, D.C. Unfortunately, LendingClub doesn’t currently accept loan applicants who live in a U.S. territory.

Verifiable bank account

You’ll need to provide a bank account that syncs up to your LendingClub account. That way, LendingClub can directly deposit the proceeds of your loan into your bank. You can expect the funds to arrive within one to three business days after your loan has been approved and signed off on.

At least 18 years of age

If you’re under 21, expect to submit your work history. Lenders will also consider it when deciding whether to extend you a loan.

Accurate personal information

It’s important to provide accurate, up-to-date personal, financial and employment information. LendingClub will factor in your personal information, such as your income, work history and other tidbits, during the application process. Make sure all information is correct before you submit it for a smooth and speedy process.

Strong credit score

You’ll need a credit score of 600 to qualify for a personal loan. The higher your credit, the better your odds of getting approved; the higher the loan amounts, the lower your interest rate. Plus, you’re more likely to get better terms.

Related: How to check your credit score

Low debt-to-income ratio

Lenders, in general, want to make sure you have a track record of making on-time payments. One of the ways they check for this is by looking at your debt-to-income ratio, which is how much of your monthly gross income is going toward debt payments.

If your debt-to-income ratio is too high, it signals to lenders that you might be stretched thin financially and could have a hard time staying afloat on your loan repayments.

Long history of successful credit lines

A history of credit accounts that you’ve paid on time can also help you secure the lowest interest rates. Your length of credit makes up 15% of your credit score, so having several lines of established credit can help boost your score and make you look more favorable in the eyes of lenders.

LendingClub personal loans: Just the facts

Founded in 2007, LendingClub started as a P2P lending platform, but in recent years, it shuttered the P2P portion and now offers savings, investing and loan products.

Borrowers can get prequalified for a personal loan within minutes by submitting basic personal and financial information online. Loan amounts range from $1,000 to $40,000 and can be used for debt consolidation, home improvement projects, covering a financial shortfall and funding weddings and vacations.

While there’s no prepayment penalty or application fee, origination fees can range from 1% to 8%. APRs range from 8.98% to 35.99%.

While LendingClub’s 600 minimum credit score makes its personal loans accessible to those with fair or average credit, the lower one’s credit score and the higher one’s debt-to-income ratio, the higher the interest rate and origination fee and the more expensive the loan.

Benefits of LendingClub personal loan

Speedy approval

According to LendingClub’s website, most members are approved for a personal loan within a few hours. This depends on your unique information. Gathering the information and required documents beforehand can help with the process.

Plus, it’s a good idea to double-check the details of your income, employment and identity. Accuracy lends itself to efficiency and speed.

Borrow up to $40,000

Borrowers with fair or average credit scores typically don’t qualify for high loan amounts. Depending on your credit and financial situation, you can get a loan for up to $40,000.

Prequalification available

You can check your rate and loan amounts by prequalifying on LendingClub’s website. It won’t impact your credit score; you can get an idea of what you’d likely get approved for before officially applying.

Co-borrowers allowed

If you’re still determining if you’d be able to qualify for a personal loan with your credit score, LendingClub allows for co-borrowers. With a joint account, you can get a loan with someone with a stronger credit score, which can boost your approval odds and land you a lower interest rate.

How to apply for a LendingClub personal loan

Check your credit

Before you apply for a LendingClub loan, check your credit. At AnnualCreditReport.com, you can order a credit report for free from each of the three credit bureaus — TransUnion, Experian and Equifax.

Knowing where you stand credit-wise can help you better understand what loan amounts you qualify for. Plus, when you review your credit report, you can pore the details to see what you qualify for. If any errors or missing information could damage your credit, this is the opportunity to fix them.

Get prequalified

LendingClub lets you get prequalified. A soft pull on your credit won’t negatively impact your credit. You can get prequalified by going online and inputting basic financial information, such as how much you need and what the money is for.

Related: How to prequalify for a personal loan

Apply online

Once you’re ready to apply, you’ll need to provide basic personal information, such as your address and mailing address, along with your income and other financial tidbits. LendingClub will offer you a few options, and you can then choose your loan amount, rate and payment option.

Before you agree to the loan, be sure to look over everything carefully, including fees.

Receive funding

Once your loan gets approved and processed, the funds will drop via direct deposit to your linked bank account or go straight to your creditors. This usually takes anywhere from one to three business days.

Where a LendingClub personal loan doesn’t measure up

Limited loan terms available

LendingClub only offers several loan terms, ranging from 24 to 60 months. If you want a different term or a longer period of time to pay off your loan, you’ll need to look elsewhere.

APRs can be high

While APRs start at 8.98%, they are reserved for those with excellent credit, low debt loads and strong financial profiles. If you have poor credit, a lot of debt and not a ton of money, you’ll likely qualify for a loan with an APR on the higher end.

Origination fees

LendingClub doesn’t charge prepayment penalties or application fees, but you can expect to pay anywhere from 3% to 8% in origination fees. Here’s the catch: While you can be eligible for a loan with fair credit, you’ll likely have a higher origination fee, which means less money from the loan proceeds goes into your account.

Receiving funds slower than some competitors

LendingClub’s funding processing times can take one to three business days. While that’s relatively slow, you can find same-day funding times elsewhere. If you’re in a financial pinch and need money quickly, it could benefit you to work with a lender who can offer speedier access to funds.

Alternatives to LendingClub

Frequently asked questions (FAQs)

Does a loan from LendingClub hurt your credit score?

A personal loan from LendingClub can hurt your score if you fail to keep up with payments. Conversely, keeping up with your payments can boost your credit. When you apply for a personal loan, the lender does a hard credit inquiry. It can bring down your credit score by a few points.

How fast do you get money from LendingClub?

Once your loan application has been processed and approved, funds will drop into your account via direct deposit within one to three business days.

Do you need proof of income for LendingClub?

LendingClub usually requires proof of income. It may also require additional documents, such as pay stubs and recent bank statements. Sometimes, you might need to provide child support, alimony, disability income or Workers’ Compensation to show proof of income.

Is it safe to use LendingClub?

LendingClub uses security features such as anti-virus protection, advanced firewalls and automatic logout. Personal and account information is never stored on your mobile device. Plus, LendingClub will monitor your online and mobile banking activity for any signs of fraud.