If you already have an auto loan but are considering refinancing, LendingClub allows applicants to see two different loan terms and rates without a hard credit check.
Hard credit checks lower credit scores, so this means borrowers can easily determine if LendingClub can offer them loan details without worrying about any negative effects on their scores.
The process is fast, pain-free, and easy to understand. LendingClub clearly lists out the APR, monthly payment, and loan term for you to compare to your current auto loan. There are some restrictions, but many borrowers are able to qualify with LendingClub who would normally be turned away with other refinancing companies.
If your monthly car payments have been taxing your bank account a bit too much, try LendingClub. With no hard credit checks before final approval, there’s no reason not to check them out.
LendingClub Application Requirements
There are a few requirements you, your car and your existing loan will have to meet before LendingClub will refinance your vehicle.
You must have a minimum credit score of 510, and live in one of the following states:
AL, AR, AZ, CA, DE, FL, GA, ID, IL, IN, KS, LA, MD, MI, MN, MO, MT, NE, NJ, NM, NY, NC, OH, PA, RI, SC, SD, TN, TX, UT, WA, or WI.
Unlike other refinancing companies, LendingClub doesn’t have a minimum monthly income requirement. Most companies like to see borrowers make, on average, at least $2,000 a month, but LendingClub does not have this restriction for its customers. This one aspect gives many borrowers who would normally be unable to refinance the potential to save money each month.
- Your car must be 10 years old or newer. If your car is any older, LendingClub unfortunately won’t refinance it.
- Your car’s odometer must have no more than 120,000 miles on it.
- The car must be for personal use only. If it’s a business car, it’s not eligible.
- The car cannot be an RV, motorcycle, commercial vehicle, or a salvaged vehicle.
- Refinancing is not available for diesel Volkswagens or Dodge Neons.
- Hummer, Pontiac, Saturn, Daewoo, Isuzu, Suzuki, and Oldsmobile vehicles are also not eligible for refinancing through LendingClub.
- The loan must have a balance between $5,000 and $55,000 left.
- The loan must be at least one month old.
- The loan must have at least two years of remaining payments.
Types of Auto Loans Available
LendingClub refinances both new and used car loans. Just make sure you meet the requirements mentioned above for both your loan and your car before you apply.
At the moment, Lending club has not yet extended itself into the purchase loan market, but that may change in the future as the company has consistently expanded over the past several years.
Fees and Rates
Rates vary depending on your credit score. Currently, the lowest APR LendingClub offers is 3.49%; however, typically only borrowers with superb credit qualify for this rate. If you have poor credit, your rate could be as high as 24.99%.
To qualify for a better rate, LendingClub considers 720 or above to be excellent, and 690 to 719 to be good. If you have a score lower than 690 LendingClub will still work with you, but just remember that they only work with borrowers with scores of 510 or above.
If you know your credit score is low, don’t forget you can see what LendingClub will offer you without having a hard credit check. It’s still very possible LendingClub can offer you better conditions than your original lender.
As for fees, LendingClub does not charge any application fees, nor are there any prepayment penalties for paying off your loan early. This is in stark contrast to many other lenders who nickel and dime their customers.
LendingClub Application Process
You’ll find out if you qualify within minutes of applying. During the initial pre-qualification process, you don’t even need a social security number, but you will need it later for final approval.
The overall process can be broken down into three steps:
The first step involves telling LendingClub a little bit about yourself. This step only takes a couple of minutes and is done entirely online. At this time, you’ll see what rates you would be offered by LendingClub. Compare the monthly payments to what you presently pay, and see if the APR is, in fact, lower than your current auto loan.
Remember: they’ll give you two options to compare to your current plan. The terms (length of set payments) will likely be different, so it’s up to you to decide if you want a lower monthly payment or more money each month applied to the existing principal.
Confirm Submitted Information
Decide which offer you like best from LendingClub. Once you do, you’ll be asked to complete an online application form. A loan specialist will get in contact with you shortly thereafter to review your submitted information and might also ask you for additional documentation about either yourself or your car.
If the information you submitted is verified and your application is approved, LendingClub then pays off your previous lender. From then on your monthly payments will be made directly to them. Depending on the refinance option you chose, you’ll likely have lower monthly payments each month and may own your car sooner than you would have if you had stayed with your original lender.
The great thing about LendingClub Auto is the ability to see what rate you would get with only a soft credit check. This means there’s no reason for anyone with an auto loan not to see what loan options they would get if they refinanced with LendingClub.
The loan range they’ll refinance in is pretty large, from $5,000 to $55,000. For most people, this is right on target because the average new car loan is $31,099, and the average used car loan is $19,589.
LendingClub works with most credit borrowers. Even if your score is 510, LendingClub may work with you. Of course, you’ll pay a higher rate than your peers, but that rate will still likely be lower than what your original lender gave you.
Lastly, many lenders these days prefer to work through auto loan brokers (companies that connect borrowers with multiple lenders). With LendingClub you’ll always work directly with your lender because they’re not representing anyone else. All communication you’ll receive will be directly from the source, meaning there’s no middle-man. It’s just you and them.
LendingClub presents risk-free auto loan refinance options to borrowers. Stop wondering if refinancing is for you and see for yourself. Pre-qualifying only takes a few minutes and will provide you with valuable information that could very well help you in the coming months and years ahead.
Just be sure to refinance early so you can start saving money sooner. Refinance late during your loan term and you might be missing out on big savings.