Climbing the LendUp Ladder
nformation verified correct on October 13th, 2016
Wise up and get a lower rate on your next loan: How LendUp is changing the credit game
Credit in the US is a fleeting thing, so why are so many Americans under-informed on the topic? Personal loans, credit cards, home loans – there are a large number of Americans who are ineligible for some or all of them due to bad credit, no credit, low incomes or unemployment. One lender who offers loans to people in these situations is also looking to educate them, and reward them with lower rates for getting informed.
Positioning itself as an “alternative to payday lending”, LendUp offers loans to people normally only eligible for a payday loan. Starting with a loan of $250, qualified borrowers can work their way up the “LendUp Ladder” to receive lower rates (as low as 29% APR – unheard of in payday loans), higher loan amounts, and reporting of payments to credit bureaus to rebuild their credit scores.
Earning 4,000 points gets you to the Gold level and means you can take out an installment loan. Once you earn 10,000 points you reach the Platinum level and LendUp will start reporting your payments to credit bureaus, and you can start rebuilding your credit.
Paying your loan on time
The easiest way to earn points is simply by repaying your loan on time. LendUp offers it’s customers many ways to make sure they pay on time. One option is automatic payment scheduling, which is a convenient way to schedule a payment in advance that LendUp will automatically withdraw from your account on the agreed upon date. If you opt for automatic payments, keep in mind that your payment will be deducted from the account that your loan was deposited into.
You can also repay your loan early if you choose. Just sign into your account, and click on the link that says “Repay early with your debit card.” Your card will be charged instantly and you will get a confirmation message on your screen. Your transaction will need to be completed by 5pm PST to be processed that day, and there is a small fee charged for debit card transactions.
Back to topCompleting financial literacy courses
The most beneficial way to climb this ladder is to complete LendUp’s financial education courses. Covering a wide array of financial topics, borrowers are not only given a way to unlock lower rates, but to also take back control of their finances and rebuild their credit history.
While financial literacy initiatives are needed everywhere, the US is definitely one of the most in need.
First-time borrowers are offered APRs between 151.42% and 315.72% for a $100 loan with a one-month term. Completing each education course, which is comprised of a short video and a quiz, lets you earn 125 points each plus a 250 point bonus for completing the first six.
While financial literacy initiatives are needed everywhere, the US is definitely one of the most in need. In the first large-scale study of financial literacy amongst 15-year-olds in early 2014, conducted by the Organization for Economic Cooperation and Development (OECD), the US ranked 12th at its worst and 8th at its best out of the 18 countries. On the test, 1,133 US teens scored a mean 492, which was 8 points below the global mean of 500.
It seems Americans aren’t learning with the experience that comes with age, either. In the 2015 Consumer Financial Literacy Survey, prepared for by The National Foundation for Credit Counseling (NFCC) only 40% of adults said they budgeted and kept track of their spending. This is a number that has “held roughly steady” since 2007. One in three of those surveyed reported carrying credit card debt from month to month, and 11% reported the amount they carried to be $2,500 or more.
The American financial system relies heavily on credit, from credit reporting to people having access to finance. Innovative solutions such as LendUp’s are taking an essential step towards creating a generation of credit-informed borrowers – but it’s only a first step. It’s ultimately up to you, the American borrower, to identify the gaps in your financial knowledge and work to fill them.
If you’re fully satisfied with the service from LendUp, you could even submit a review to earn extra points. This could be either a video submission or written testimonial. You also have the option of referring a friend. If you refer a friend who ends up getting a loan, both of you will earn points!
https://www.finder.com/the-lendup-ladder
