Payoff, now known as Happy Money, is a platform that provides personal loans to pay off credit card debt. Upstart acts as an intermediary between the client and the lender and is based on artificial intelligence technologies. The choice between Upstart personal loan and Payoff loan can be significantly facilitated by comparing the important parameters of the two platforms.
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Payoff vs Upstart: a Comparative Chart
| Payoff | Upstart | |
|---|---|---|
| APR Range | 8.99 - 29.99% | 5.6 - 35.99% |
| Term | 24 - 60 months | 36 - 60 months |
| Loan amount | $5,000 - $40,000 | $1,000 - $50,000 |
| Min Score | Good (670-739) | Poor (300-579) |
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How to choose between Payoff & Upstart
Terms
Payoff
First of all, a potential borrower should be aware of the basic terms of lending offered by the Payoff platform:
- the loan repayment period includes from 24 - 60 months;
- the available personal loan amount ranges from $5,000 - $40,000. At the same time, there is a restriction regarding the available minimum loan amount for two states: New York - $5,100, Maryland – $6,100;
- the credit score is taken into account, the minimum value of which should be equal to 640;
- fixed rates (APR) range from 8.99 - 29.99%. If the loan amount exceeds $15,000, then the minimum rate (APR) is 9.24%;
- there are no general fees of any kind, including application fees, late payments, early repayment, processing or refund of checks. The only fee available is the origination fee in the amount of 5%, depending on the selected loan term. It takes the form of a one-time payment upon issuance of a loan and is charged from the borrower to cover the lender's expenses.
Upstart
The conditions of the Upstart credit platform are characterized by the following features:
- the loan repayment period is 36 - 60 months;
- compared to a competitor, the possible loan amount is more flexible and ranges from $1,000 - $50,000. The restriction in the form of the available minimum loan amount also applies to some states: Hawaii – $2,100, Georgia – $3,100, Massachusetts – $7,000;
- despite the fact that the credit score is not a key indicator when considering a loan application, its minimum value should be at least 300;
- fixed interest rates (APR) range from 5.6 - 35.99%;
- a one-time origination fee, which can be up to 10%. In addition, there is a late payment fee of 5% of the monthly overdue amount or $15, a $15 fee for each return check, and a $10 paper copy fee. There are no fees for prepayment and early repayment.
The loan application process comparison
Payoff
The application process includes the following steps:
- checking the rate based on a soft request that does not affect the credit score;
- consideration of received proposals after preliminary approval, which involves familiarization of the client with the terms of the loan and subsequent selection of the appropriate option;
- provision of necessary personal data and confirmation of the specified information;
- electronic signature of relevant documents and preparation for financing, which is usually carried out within 3 - 6 business days to a personal current or savings account.
The borrower must complete the application within 30 days. This is due to the fact that reporting is sent to credit bureaus and the company checks that the rates correspond to the information specified by the client. Documents proving the identity of the borrower and confirming his income, social security card, bank account statement and others may be requested for verification.
Upstart
Submitting an application is quite simple and comes down to a few steps:
- formation of a request for a rate on the platform's official website;
- selection of a suitable rate and filling out an online application, including information about academic data, work experience, and the purpose of the loan. The application also contains information about the bank account, which sometimes requires confirmation through the relevant documents;
- waiting for a decision. If it is approved, the applicant is invited to review the final information and confirm his agreement in the promissory note.
The initial stage, during which the borrower checks his rate, does not affect his credit rating due to a soft loan request. However, the situation changes when the consideration of the application continues and the lender proceeds with a hard request to verify the specified data.
Is income verification required for Upstart and Payoff personal loans?
Upstart accepts different documents to confirm the source of income, depending on the employment status. It is important to remember that only the personal income of the client is taken into account, which includes salary, income from self-employment, income from rental property, pension and other forms.
Payoff may also request confirmation of the borrower's income to verify the veracity of the information provided in the application. Such documents may include the last payment receipt, a pension payment letter, the latest tax information, etc.
Which is better for the first loan - Payoff or Upstart
Since Upstart is ready to consider the application of a client with insufficient credit history, the possibility of obtaining a loan remains. The company does not consider the credit score as a fundamental factor. In addition to the financial situation, Upstart takes into account factors such as the field of study and the client's employment history. It also significantly increases the chances of the borrower to approve his application, including the first loan. It is important to understand that with a bad credit history or no credit, the conditions may be less favorable and the loan program may be characterized by higher interest rates.
Payoff does not provide loans if the potential borrower does not have any credit. Moreover, the term of the established loan must be at least three years.
Which is better for credit consolidation - Upstart or Payoff?
Despite the fact that the number of permitted uses of Upstart includes consolidation of credit cards, it is worth paying attention to Payoff. The last of these companies specializes in helping the borrower to repay their credit cards. The platform has a number of advantages that determine the choice in its favor:
- simplification of payments by consolidating credit card bills into one monthly payment;
- the ability to improve the credit score to create a good credit profile;
- decrease in total interest payments;
- no additional fees in the form of hidden fees, late payment fees, prepayment fees;
- guarantee of data confidentiality;
- the ability to quickly reduce and eliminate credit card balances.
When is Payoff Better? / When to choose Upstart?
It is better to consider Payoff when:
- there is an interest in flexible lending terms, since the platform has the ability to independently choose terms, repayment date and monthly payments;
- there is a need a shorter loan repayment period;
- consolidation of credit cards is required;
- there is a need to increase the credit score and improve the credit profile;
- there is a desire to get good competitive rates.
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Upstart should be selected in the following situations:
- there is no good credit history, as the platform analyzes some non-standard credit indicators;
- the borrower takes a loan for home improvement, student loan refinancing, payment for medical services and other permitted uses;
- interested in the large variability of the loan amount, including the upper and lower limits;
- the borrower seeks to protect himself with the help of a program that allows the temporary suspension of loan payments in case of problems in the economic sphere.
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