Rise credit is a company that offers loans, especially to college students who have a low credit score and may not qualify for loans anywhere else.
This is a relatively new company that was incorporated in 2013, and as of 2017, they had been able to loan out almost $2 billion in loans to more than half a million of their customers who have subprime credit.
It, however, received many negative reviews due to the following reasons;
A very high APR
APR stands for Annual Percentage Rate, and according to Rise Credit, the actual amount of APR you pay for your loan will depend on the state in which you live in. This, however, ranges between 50.00% up to 299.00%.
It is not available in all states:
Rise credit is unavailable in – Arkansas, Connecticut, Colorado, Iowa, Maine, Louisiana, Maryland, New Hampshire, Massachusetts, New Jersey, North Carolina, New York, Pennsylvania, South Dakota, Vermont, Virginia West Virginia, and Rhode Island.
This is a disadvantage because if you are a college student in any of those states, then it means that you will not be able to access any of their loan products.
Credit score requirements:
Credit score refers to a 3-digit number, that tells Banks and other lenders whether you can be able to repay your loans, and depending on the score, they can either approve or deny you. It normally ranges from 300 to 850, and you will need a minimum score of at least 500 to be able to get a simple loan. Most lenders may even ask for a higher score, and this will undoubtedly limit you.
With Rise Credit, you must have a score of at least 500 before they can consider you for a loan. This may be the minimum, but for most college kids who have a lower score, it will be a great disadvantage as they will be unable to acquire a loan.
Not available to military members:
Because the interest rates for Rise Credit are so high, they are legally unallowed in the military circles due to the military lending act.
This is a great disadvantage because it means that if you are in college and in service, you cannot be eligible for a Rise Credit loan.
The Basics of Rise Credit:
In order to qualify for a Rise Credit, there are some criteria that you must meet. These include;
- You must be at least 18 years old.
- You must have a regular source of income.
- You must have a regular checking account.
- You must have an email address.
- You must live in a state where Rise Credit is accessible
The amount of money you shall qualify for will depend on where you reside. This will range between $500-5,000.
The application process normally takes three steps – An online application, choose terms and then receive the funds the following day in your checking account.
As stated above, Rise Credit has very high costs which depend on very many factors such as the state of residence and your credit score. The APR will normally range between 36% to 365%. In addition to this, there are some origination and late repayment fees. The late fees will depend on the state, but it is normally 5% of the amount of installment.
Your credit score is the most important factor when it comes to the cost of the loan.
Rise credit installment loan:
An installment loan from Rise credit is simply a short-term loan that offers longer repayment periods on large amounts using a set number of installments. The loan ranges from $500 to $5,000 and flexible repayment terms are always available.
The interest will accrue over the life of the loan, and if you want a longer repayment period, it means that you shall pay a much higher interest rate, than someone who chooses to repay the loan in a shorter term.
The APR for the installment loan is between 36% and 299%, and as mentioned earlier, this will depend on where you live and your creditworthiness, i.e. your credit score. The higher the score, the lower the APR, but you must reside in the following states; Alabama, Delaware, California, Idaho, Georgia, Illinois, Mississippi, Kansas, New Mexico, Missouri, Ohio, North Dakota, Texas, South Carolina, Utah, and Wisconsin.
The approval period is very fast, and you shall be able to receive the funds in your account within one business working day, and you shall get to choose a higher loan amount, but bare in mind the interest rate, which is high, and it accumulates over the life of the loan.
You had rather take the loan for a shorter period and repay it immediately before you end up paying too much for the loan in the long run.
Regardless of whether you have good credit or not, it is important to check other lenders. You may find someone else who is cheaper than Rise Credit, because truthfully speaking, their interest rates are way too high for any person.
These other companies also offer a fast application process, and a deposit into your checking account at a much lower rate.
Here are a few other options for you to consider;
This is a bank that is located in Atlanta, and it offers loans in 50 states. This means that no matter where you are, you can always be able to access a light stream loan.
Why is it better than Rise?
Light stream is much better compared to Rise credit due to the following reasons;
- APR rate – It offers a fixed APR rate that ranges between 4.99% to 16.99%, and this is much lower compared to that of Rise Credit that ranges from 36% and 299%. You cannot even compare the two APR's.
- With Light stream, the APR will vary depending on your credit score and doesn’t rely on where you live, which means that everyone is graded on the same level.
- Loan limits – with Light stream, you can borrow from $5,000 to $100,000, this is way too high compared to that of Rise which ranges between $500 to $5,000 only.
- Maximum repayment period – Light stream offers a repayment period that ranges from 24 – 144 months, while the Rise credit will offer you a period of up to 26 months, which is a little over two years, and they promise lower rates if you repay within two years flat.
Other features of light stream that you shall appreciate;
- They do not charge any origination fees – This is a fee that you may find with Rise Credit, and it is charged for Loan Processing, funding and underwriting the loan. It ranges between 0.5% 5% of the entire loan amount. If possible, choose lenders that do not charge this fee, as it means that they will reduce the total amount of loan you receive.
- They do not charge any late fees – If you happen to delay on your repayment, what you will love most about light stream loans is that they shall not charge you any fees in relation to that.
- They do not charge prepayment fee – if you decide to pay off your loan before the repayment period has expired, Lightstream will not charge you any fees in relation to that as well.
- Lightstream will consider you for a loan under the following requirements;
- If you have a credit score of 660 and above.
- Minimum age of 18 years.
- You will be considered regardless of your employment history, just as long as you can demonstrate to them that you shall be able to repay the loan.
- If you are in the military, then you are still eligible to apply for the loan because of their low-interest rates.
Most people with a low credit score will turn to Avant because for you to become eligible for a loan with them, you require to have a score of 580 which is much lower compared to the competition in the lending industry.
This is one of the largest lending platforms for this specific kind of customers, and it is based in Chicago. According to the company, most of their customers normally take loans primarily for debt consolidation purposes only.
Other features of Avant;
- Refinancing options- you are eligible for refinancing which allows you to get a higher loan and at a lower rate as well. You will need at least nine months of repaying your loan on time, in order to qualify for a refinancing of the original loan.
- Service delivery – they have an extremely active customers service department, and in addition, there is an app that you can download on your iOS and Android to help you monitor the loan.
- Loan amount – if you have bad credit, you can borrow a loan of up to $8,000 which would attract an interest rate of 27% and a repayment period of up to 24 months. As such, you would be paying a monthly installment of $436.
OneMain Financial Personal Loans:
This is a lending company that caters mostly to people with very bad credit scores, and in most cases, they will not bother with your score, although most of their customers are in the 600 – 650 range.
They have over 1,600 branches countrywide and will require just one day to be able to process your loan.
- Loan amounts – their loan amounts normally range from $1,500 to $30,000.
- APR – This is the interest rate per loan, and it ranges between 16.05% – 35.99%. The minimum interest rate however for quick secured loans is 9.99%.
- Repayment period – the period of repayment for a OneMain financial Loan is between 2-5 years.
- Qualifications – Minimum credit score – none
- Minimum credit history – not provided.
- Minimum annual income – none
- Loan example – If you have bad credit and you take out a loan of say, $10,000 which is unsecured, the loan repayment terms would be two years, at an APR of 27.2%, and this would require a monthly installment of at least $545 per month.
This is a perfect loan solution company for people with very bad credit and who would probably never get a loan anywhere else, and people who also want quick cash.
Peerform Personal Loans:
This is a company that lends to borrowers with low credit scores. Their goal is to connect borrowers with lenders who are willing to give them money, and they normally charge an origination fee.
It is ideal for:
People with poor credit scores of at least 600 and who cannot be able to get a loan with any other lenders such as banks. It normally assigns you a borrowing grade when you apply for a loan depending on your score, and they will wait for a loan decision from the lenders based on the grade that you shall receive.
People who are new to credit – if you have never borrowed a loan before, this is a great platform to start on, and they give loans for a maximum repayment period of at least one year.
People that want to consolidate their loans – this is one of their main core functions, if you have lots of loans borrowed elsewhere and you wish to repay them off and remain with one loan, which is called consolidation, then this is a good option for you.
Loan amounts – Between $4,000 – $25,000
APR rates – 5.99% – 29.99%
Fees – an origination fee of 1% – 5% per loan amount.
Funding period – typically within one week.
The information above is simply geared towards giving you better options if you have an unfavorable credit score. Rise credit is not the only financier for college students as well; all these other companies are able to provide for them.
Before choosing a specific company, however, ensure to extensively research on their loan terms, the APR, and most especially the loan repayment period, because this will determine how much interest you will end up paying.
One thing you should remember is; choose a company that does not charge an origination fee. Granted, we have added a few that do the same, and these you can choose when you are completely at a fix and are unable to find financing from any other source.