34% of Americans take out personal loans every year.
Personal loans can alleviate emergency situations and consolidate credit card debt. It is also possible to secure a personal loan online, even if you have a poor or limited credit history.
If you are considering taking out a personal loan, it’s essential to research lenders wisely before you sign on any dotted line.
This is particularly true if you are thinking about an online lender like Earnest.
Earnest loans are available to people who need student and personal loans in a variety of circumstances. In this post, we’ll give you the comprehensive Earnest lender review you need to feel good about your decision!
Earnest Loans: The Basics
Earnest is one of several online lenders that offers personal loans to qualifying borrowers. According to its website, Earnest brings “low-interest loans to high-potential people.”
Earnest is an entirely online lender that is devoted to giving its customers a “fast, low-cost, and hyper-personalized financial experience.” According to its website, the lender uses data and cutting-edge technology to streamline the borrowing process and give people access to the rates they need.
More specifically, Earnest has a variety of options when it comes to loans.
Through Earnest, graduates can refinance student loans they obtained through other lenders. The lender’s site also has two calculators that can help graduates crunch numbers for refinancing purposes.
According to its site, Earnest can help all kinds of graduates save an average of $30,939. Student loan consolidation rates begin at 2.57% APR with autopay.
In addition to student loan refinancing, borrowers can also take out home loans in order to finance the purchase of a house. Earnest gives borrowers three options for mortgages: conventional, conforming, and jumbo mortgage programs.
These programs have 15-year and 30-year fixed rates.
Earnest’s site also has a bunch of resources that can help first-time homebuyers apply for an Earnest mortgage confidently. Earnest does not charge any lender fees. Borrowers will only have to pay third-party fees, such as those associated with appraisals and settlements.
Lastly, borrowers can take out Earnest personal loans for weddings, vacations, and credit card debt consolidation. Qualified borrowers can take out up to $75,000 at variable rates beginning at 5.49% APR.
It is possible to apply for a loan through Earnest online. However, individuals who want to take out an Earnest loan will have to provide more than just their credit score.
This lender evaluates applicants comprehensively, analyzing savings patterns and career trajectories. For this reason, Earnest borrowers get access to rates that suit their specific financial situation.
There are quite a few eligibility requirements Earnest borrowers have to meet in order to take out a loan. For example, if you are interested in taking out a personal loan through Earnest, you will have to have a credit score of at least 680.
We’ll discuss the ins and outs of these eligibility requirements later on in this post.
There are several advantages to taking out a loan through Earnest. Let’s take a closer look at these now.
1. Dedicated Support
Taking out a loan from an online lender can be intimidating, especially if that lender does not provide much human-to-human interaction. It’s critical to choose a lender that places a premium on customer support.
What’s more, lenders that offer great customer service are far less likely to be scams.
The good news is that Earnest emphasizes its ability to give all customers human support throughout all steps of the borrowing process.
Whether you take out a personal or home loan or choose to refinance student debt through Earnest, you can count on dedicated, real-life support until you pay off your full loan balance.
What’s more, Earnest’s website has a lot of resources available for potential borrowers when it comes to debt management and refinancing.
This can be particularly valuable for people who are thinking about requesting a home loan through Earnest. Mortgages are high-value, high-risk loans, especially for first-time homebuyers, and it’s important to have a qualified support system throughout the mortgage process.
2. No Fees and Low Rates
Earnest emphasizes the fact that it does not charge borrowers any origination fees for taking out personal or home loans. It also does not have any fees for paying off your loan early, what’s often called a “prepayment penalty.”
This is important, as it’s possible to locate a lender that offers good rates but charges borrowers all sorts of fees to secure a loan.
This can also be important for people interested in requesting a home loan, as many conventional mortgages involve a host of lender’s fees up-front. These can be prohibitive when rolled into other third-party fees involved with buying a home, such as appraisal fees.
Earnest does offer variable rates on all of its loans and refinancing options. However, these rates begin at exceedingly low values.
The fact that some students can refinance their debt at a 2.57% APR is significant. The standard APR for unsubsidized federal student loans (for undergraduates) is at least 4% and often climbs to 6% or 7%.
Personal loan borrowers through Earnest will also appreciate the low rates for qualifying loans, especially those that hover just above 5% APR.
Finally, it is possible to receive funds within a week of requesting an Earnest loan. This can be ideal for borrowers who find themselves in a financial emergency or need cash fast.
3. Borrowing Potential for Eligible Applicants
Many online lenders offer small personal loans to qualifying borrowers, ranging between $200 and $5,000. However, Earnest gives the right applicants a chance to take out loans of up to $75,000.
The high borrowing potential that Earnest offers applicants can be a key advantage, particularly for borrowers who need to finance home improvement costs or consolidate credit card debt.
It can be especially valuable for borrowers who have solid credit histories and scores. These borrowers are more likely to qualify for higher personal loan amounts given Earnest’s eligibility requirements.
Earnest also enables applicants to choose how much they want to pay per month, within flexible limits.
There are a few disadvantages to keep in mind when it comes to applying for Earnest loans. Read on for insight.
1. Eligibility Requirements
Perhaps the biggest drawback of requesting an Earnest loan is this lender’s strict requirements for eligibility. While a lot of this lender’s loan terms sound amazing, borrowers will have to check the right boxes to achieve them.
All personal loan applicants have to have a credit score of at least 680 in order to have their applications approved. Individuals who want to request an Earnest home loan will have to have credit scores of at least 660.
As a graduate wanting to refinance student debt through Earnest, you will have to have a minimum credit score of 650.
If you have a poor or limited credit history, an Earnest loan may simply not be feasible for you. However, a Bonsai Finance loan may be. Learn more about bad credit loans here.
Earnest does not serve individuals who are not U.S. citizens. It does not provide personal or home loans for residents of at least five U.S. states, so be sure to check your resident eligibility before requesting an Earnest loan.
Individuals who are keen to request a personal loan through Earnest will have to use this loan for very specific purposes, such as credit card consolidation and wedding costs. You can’t use an Earnest personal loan for purchasing real estate, paying for student tuition, or business capital.
In general, Earnest prioritizes customers with solid credit history, low debt, and income that is greater than their monthly expenses. It also gives preference to clients who have a history of paying bills on time.
For this reason, Earnest loans may be out of reach for individuals who have a high debt-to-income ratio.
2. Variable Rates
Along the same lines, Earnest offers variable rates on personal loans and student financing. These begin at quite low numbers.
However, borrowers with less-than-excellent credit may face rates as high as 18% on personal loans. Earnest borrowers who choose longer loan terms such as five-year repayment plans also face dramatically higher APR.
This may simply be prohibitive for some borrowers, particularly those who request a large sum to be paid off over the longest term available.
If you do find the notion of an Earnest loan attractive, be sure to lock in your rates before you sign anything.
3. Hard Credit Checks
When requesting an Earnest loan, the lender performs a hard credit check on all borrowers. Hard credit checks do impact your credit score, which can be particularly damaging for people who are working hard to rebuild credit.
A hard credit check does not guarantee loan approval, either. Applying for an Earnest loan in this regard can be risky for applicants with compromised credit.
The Verdict: Earnest Loans
Earnest is one of many online lenders of personal and home loans, as well as student debt refinancing. In general, this lender has a variety of options and high borrowing potential for the right applicants.
If you have great to excellent credit and a solid borrowing history, Earnest may be for you. Earnest is particularly ideal for borrowers who meet its eligibility requirements and want to lock in a great rate for a shorter payoff period.
Earnest loans may not be viable for borrowers who have poor or compromised credit. They can also involve higher rates than expected, especially for individuals who request longer payoff periods.
At Bonsai Finance, we recommend comparing rates from several online lenders before making your decision. We can help you secure the loan that meets all of your needs today. Contact us now!