LendingClub Personal Loan Review
NMLS#1136
Read more about how we rated Lendingclub.
LendingClub, an online lender, provides flexible loan amounts ($1,000 to $40,000) and a low minimum credit score of 600, which may make it easier for consumers with less-than-perfect credit to qualify.
- Offers joint applications: If you’re not able to qualify for a personal loan as an individual, you may be able to file a joint application with a co-borrower.
- Quick approval decisions: It typically takes just a few hours to get an approval decision from LendingClub.
- Direct payment to creditors: If you plan to use a LendingClub loan for debt consolidation, this lender will send your funds directly to your original creditors.
- Charges an origination fee: You may have to pay an origination fee — an administrative fee commonly associated with personal loans — that can range anywhere from 3.00% - 8.00% of your loan amount.
- High maximum APR: LendingClub’s annual percentage rate (APR) can get as high as 35.99%, while other lenders have a lower cap.
- Best for joint loans: LendingClub may be best for consumers who want to apply with a co-borrower or to consolidate debt. Since this lender allows joint applications and can make direct payments to creditors, it may be a good fit for borrowers looking to check one or both of those boxes.
LendingClub pros and cons
LendingClub provides an assortment of benefits to its customers, but that doesn’t mean it’s the right fit for everyone.
| Pros | Cons |
|---|---|
Offers joint loans Provides direct payments to creditors Offers same-day approval decisions | Charges an origination fee High maximum APR Charges late fees |
If you want to secure lower interest rates but don’t have excellent credit, LendingClub offers the option to apply for a loan with a co-borrower — a second individual who has good credit and shares the legal responsibility of repaying the loan. LendingClub provides quick approval decisions and the opportunity to directly pay your creditors if you’re looking to consolidate your debt.
However, LendingClub borrowers have to pay an origination fee of 3.00% - 8.00% of the total loan amount. This lender’s APR can go as high as 35.99%, while competitors like Discover and SoFi cap APRs at much lower rates.
LendingClub requirements
LendingClub doesn’t provide many specifics about personal loan eligibility criteria, aside from requiring borrowers to be at least 18 years old. Here’s what we know:
| Minimum credit score | 600 |
| Residency requirements | LendingClub provides personal loans in all 50 states. However, you must be one of the following:
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| Required documents |
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If you meet the basic requirements listed above, you may need to disclose how you plan to use your personal loan. While LendingClub does allow borrowers to use its funding for a variety of purposes, there are certain expenses for which you cannot use the borrowed money.
| LendingClub loans CAN be used for… | LendingClub loans CANNOT be used for… |
|---|---|
Debt consolidation/credit card refinancing Home improvement projects Major purchases Green loan for sustainability projects Business Medical expenses | Secondary education Illegal activity Investments Cryptocurrency |
If LendingClub’s loan options don’t work for your borrowing needs, be sure to shop around for a lender that helps you meet your financial goals and can offer you the best-fitting rates, terms and amounts.
How to get a loan with LendingClub
Because LendingClub is an online loan lender, you won’t have to worry about visiting a branch in person. The application process can be done from the comfort of your home.
Check if you prequalify
If you want to shop around for personal loans without impacting your credit score, LendingClub offers the option to prequalify for a loan. Prequalification involves a soft credit inquiry to show you the rates and loan terms you may qualify for. While prequalified offers are not guaranteed, they can give you a good idea of which lenders might be the right fit for your needs.
During this process, you’ll have to provide personal information such as your date of birth, annual income and contact information.
Verify your information
If you prequalify for a LendingClub personal loan, you can formally apply and verify your information with official documentation. For instance, to verify your income, you may need to supply pay stubs or recent W-2s.
You’ll also need to submit to a hard credit inquiry. As opposed to the previously mentioned soft credit pull, this can cause your credit score to drop by a few points. A hard credit inquiry allows lenders to have a more detailed account of your credit report.
Sign your loan agreement
If LendingClub officially approves you for a loan, you’ll have to sign a loan agreement outlining the terms, fees and conditions of your personal loan. After you’ve signed it, LendingClub will either deposit your funds into your personal bank account or repay your original creditors.
If your application for a personal loan is denied, you may need to work on improving your credit score and beefing up your credit profile. To increase your chances of getting approved for a loan, you can try strategies like checking your credit report for errors or locking down a steady source of income.
How LendingClub compares to other personal loan companies
Even if you believe LendingClub aligns with what you’re looking for in a personal loan, it never hurts to shop around and compare lenders. Here’s how LendingClub stacks up against similar personal loan lenders.
| LendingClub | Avant | Best Egg | |
|---|---|---|---|
| LendingTree’s rating | 4.1/5 | 3.8/5 | 4.3/5 |
| Minimum credit score | 600 | 550 | 580 |
| APRs | 8.98% - 35.99% | 9.95% - 35.99% | 6.99% - 35.99% |
| Loan amount | $1,000 - $40,000 | $2,000 - $35,000 | $2,000 - $50,000 |
| Repayment term | 24 to 60 months | 24 to 60 months | 36 to 60 months |
| Origination fee | 3.00% - 8.00% | Up to 9.99% | 0.99% - 9.99% |
| Funding timeline | May take a few business days to receive funds | Receive funds as soon as one business day | Receive funds within one to three business days |
| Bottom line | At 3.00% - 8.00%, LendingClub falls between Avant and Best Egg when it comes to origination fees. It also offers smaller starting loan amounts. | Despite having less flexible loan amounts than LendingClub, Avant has a shorter minimum loan term and a lower credit score requirement than LendingClub. | Best Egg has the potential for a higher origination fee than LendingClub, and offers less flexible repayment terms. However, Best Egg does offer much larger loans. |
How we rated LendingClub
To come up with our star rating for personal loan companies, LendingTree considered 22 data points across three categories:
- Accessibility: We paid attention to whether lenders offered loans to nontraditional borrowers, as well as those without excellent credit scores. We also checked if lenders offered soft credit pulls, and whether they were transparent about eligibility criteria other than credit scores.
- Rates and terms: We wanted to know if lender rates, terms, amounts and fees were not only transparent, but competitive.
- Repayment experience: We based this category on lenders’ reputations, customer support availability and unique benefits.
The data points reflect every step of the process to shop and apply for, borrow and repay personal loans. A five-star lender, for instance, has flexible eligibility requirements, offers you the chance to prequalify without commitment and supports you in zeroing your balance.
The 22 data points, culled from the lenders themselves, determine the overall rating. We score lenders consistently, sometimes awarding partial points, so that you can make apples-to-apples comparisons when shopping around.
LendingTree isn’t paid for conducting these reviews, and lenders don’t have control over their content. With our reviews and ratings, we aim to give our users the objective and exhaustive information they need to make the best possible decisions.
Frequently asked questions
LendingClub is a legitimate loan company that offers loans ranging from $1,000 to $40,000. It also offers flexible loan terms and APRs that don’t currently go above 35.99%, which fits within what is considered to be responsible lending practices by policy advocates.
LendingClub has a minimum credit score requirement of 600 but also considers other factors when reviewing your personal loan application.
The lender will also look at your credit history and debt-to-income (DTI) ratio, which is how much debt you have compared to your income. It’s typically recommended that you don’t have a DTI ratio below 35%.
Checking to see whether you prequalify for a LendingClub personal loan won’t hurt your credit, but if you officially apply, you’ll have to go through a hard credit inquiry. This can cause your credit score to drop slightly and will stay on your credit report for up to two years.
Keep in mind that any trustworthy lender will require that you submit to a hard credit inquiry at some point in the application process so it can see your credit profile.
After you’re approved for a personal loan, it may take a few days to receive your funds.
Typically, it can take anywhere from one to ten business days to receive your money from a lender, but many other lenders also offer quick funding.