Lending Club is a financial community that brings together borrowers and lenders for the purpose of mutually beneficial cooperation. The platform replaces the costly and time-consuming bank loan process and offers a simple, transparent and confidential mechanism.
Lending Club is a well-known lender in the business that offers personal and business loans on advantageous conditions as well as consumer finance and auto refinancing at a lower rate of interest. Also, it assists clients in covering expenditures of expensive medical services. The rates of interest are comparatively reasonable, especially if you have a good credit history, and you will not pay any prepayments if you repay your loan ahead of schedule.
The specifications of achieving a loan in Lending Club
If you want to apply to Lending Club, you should keep in mind that your credit score should be at least 600, although most lending companies have scores approximately 700. If this requirement doesn’t fit you, then it is better considering the other options instead. Lending Club is a bad choice if you need money right away. Since you have to wait until your loan is financed by a network of peer creditors of the company, it may take about two weeks to get your funds.
It is better to apply to Lending Club in case:
- Your credit history is quite long credit history. The minimum credit history should be 3 years. It shouldn’t be spoiled.
- You have a stable and rather high income. The company meets the yearly income of $79,145.
- Your borrower ratio is low. It is 18.29% without mortgages.
The scheme of work with the Lending Club platform is as follows:
- The borrower sends a request for a loan after passing a formal assessment of their creditworthiness.
- In accordance with the credit history and objectives of the loan, the company offers an interest rate that varies from 6.95% to 35.89%. The loan amount ranges from $1000 to $40000. The loan term is limited to a maximum of 5 years.
- Borrowers should pay interest on a monthly basis. If there is the required amount in their bank accounts, it happens automatically.
- The client receives the money to his bank account as soon as 3 business days.
The benefits of investing to Lending Club
In addition to the interest paid to investors, borrowers also give from 5% to 7% to the company. The amount of rate of interest depends again on the borrower's rating. Lending Club also earns from investors by imposing a tribute of 1% of the monthly payments they receive from borrowers. This scheme is beneficial for borrowers because it gives fast access to funds, appropriate terms, and reasonable rates of interest compared with those the banks offer. For investors, it allows earning some additional funds easily and fast while assisting your peers in the borrowing process.
The services on offer
- The opportunity to receive up to $40000: Seize the chance to borrow up to $40,000. You will never find any financial institution that offers a large cash advance. In case you have an intention to borrow a solid sum of money, Lending Club is a great choice.
- The absence of prepayment charges: The company doesn’t ask for any advance payment. Therefore, if you decide to repay the loan early, you will not be charged an additional fee to pay off the lost rate of interest.
- Origination fees: Like most lenders, the Lending Club provides a fee on entering into a loan agreement to cover the cost of processing the cash advance. It varies from 1% to 6%, depending on your current credit worthiness. This amount is not included in the amount of your loan. So if you need a particular sum of money, check out that you are borrowing a sufficient amount to repay the cost of this charge.
- Small loans for business development: Besides personal lending, the company also provides small business lending. The sum of the borrowing ranges from $5,000 to $300,000. The company doesn’t provide any down payment and rates of interest make a start at 5.99%. To achieve a cash advance for business development, your company has to be no less than two years old, and revenues must be $50,000 per year. Lending Club doesn’t provide any financial operations with those who have insolvencies or tax liens.
- Auto refinancing: If it is a challenge to cover a costly auto loan, it is possible to refinance it at the Lending Club. Your car should be at least under seven years old with a mileage of less than 80,000 miles. The lending amount varies from 5,000 to 50,000 US dollars, and interest rates range from 2.49% to 19.99% per annum.
- Patient Solutions: If you faced the difficulty to pay for costly medical or dental services, Lending Club Patient Solutions can provide you with the necessary assistance. It is possible to receive up to 50,000 US dollars with an interest rate from 3.99% to 24.99% per annum.
The essential information about the costs
It isn’t possible to know the certain price of a loan until you apply to Lending club. However, there is an opportunity to have an idea by visiting the company's official website. This will not affect your credit rating. After you complete the application, you will be offered several options, and you will be able to select the one according to your desires.
To determine the accurate interest rates, the lender checks your month income, credit score, and other issues. The next step is assigning you a personal rating. It ranges from A to G. Those clients who got an A rating can expect to receive 6.95% rates, and rating G means you may be assessed to 35.89%. These costs are reasonably priced compared with other financial institutions. So, applying to the Lending club you may even derive a benefit.
For investors, the costs are a bit simpler. It is possible to choose the amount to invest. The minimum investment is $25. The investor makes a decision which lends they want to invest in because this directly affects the income of the investor. A-rated client will be a safer to invest, but the rates of interest will be much lower. Alternatively, a borrower with a rating of G can bring you more income, but they are also more likely not to fulfill their loan obligations. You can diversify your portfolio in order for you to have several instances and set up automatic investing for your convenience.
Lending Club is an excellent choice if you want to borrow a big sum without contacting the bank. Nevertheless, if you have a bad credit history, you may have problems getting a loan. In this case, you may try some other variants, such as OneMain Financial or Avant.