Comparison of Upstart and SoFi Personal Loans: Key Takeaways, Features, and Pros and Cons

"Upstart vs. SoFi: A Comparison of Two Popular Online Personal Loan Lenders"

In the world of online personal loan lenders, Upstart and SoFi stand out as two popular choices for borrowers. While both offer strong personal loan options, they cater to different segments of the market based on credit scores and loan amounts.

Founded in 2011, SoFi initially focused on student loans but has since expanded its offerings to include a variety of loans and financial services. On the other hand, Upstart, founded in 2012, uses a unique algorithm that considers factors beyond just credit scores, such as education and employment history, to match borrowers with lenders.

When comparing Upstart and SoFi, it’s essential to consider key factors such as annual percentage rates (APRs), loan amounts, eligibility requirements, and funding times to make an informed decision.

Upstart vs. SoFi at a Glance:

• Upstart:

  • Best for consumers with less-than-perfect credit
  • Loan amounts range from $1,000 to $50,000
  • APRs from 7.80% to 35.99%
  • Loan term lengths of 3 or 5 years
  • No minimum credit score requirement
  • Funding available in one business day
• SoFi:
  • Best for those with good to excellent credit seeking larger loan amounts
  • Loan amounts range from $5,000 to $100,000
  • APRs from 8.99% to 29.49%
  • Loan term lengths of 2 to 7 years
  • Minimum credit score requirement of 680
  • Same-day funding available if approved by 7 p.m. ET

Upstart Personal Loans:

• Bankrate’s View:

  • Upstart’s approval process considers factors beyond credit score, making it suitable for borrowers with fair, bad, or no credit history.
  • Low minimum APR makes it attractive for good- and excellent-credit borrowers as well.
• Pros and Cons:
  • Pros: Fast loan approval, low interest rates, low loan minimums
  • Cons: High maximum APRs and origination fees, limited choices for loan terms, no co-signers permitted

SoFi Personal Loans:

• Bankrate’s View:

  • SoFi requires a higher credit score but offers competitive APRs and higher maximum loan amounts.
  • Optional origination fee and DirectPay feature for debt consolidation.
• Pros and Cons:
  • Pros: Co-signer permitted, high loan maximum, flexible loan terms
  • Cons: Higher minimum loan amount, good credit score required, funding may take a few days

How to Choose Between Upstart and SoFi:

• Consider factors like APR range, minimum credit score, repayment terms, loan amount, and fees.
• Upstart may be better for poor-credit borrowers, while SoFi offers larger loans to those with good credit.
• Compare offers from both lenders and explore other options before making a decision.

In conclusion, both Upstart and SoFi are reputable lenders with their own strengths and weaknesses. Whether you prioritize lower rates, larger loan amounts, or flexible terms, it’s essential to evaluate your financial needs and credit profile before choosing the right lender for your personal loan.