Upstart vs. Upgrade: Which Is Right for You?

Upstart and Upgrade are two online lenders with very similar names that offer fast funding and cater to a similar audience — borrowers with fair and better credit. But there are distinct differences. While Upstart has a lower starting APR and higher maximum borrowing amount, Upgrade delivers lower interest rates, on average, according to Credible closed loans data. Plus, Upgrade offers joint personal loans.

Before applying, compare the important features of Upstart vs. Upgrade to find the lender that best matches your borrowing goals.

Upstart vs Upgrade: Overview

Upstart and Upgrade are online lenders offering personal loans for a broad range of borrowers, but each one has unique features and perks. For example, Upstart uses artificial intelligence to assess alternate qualification criteria for loan applications, making it potentially more accessible if your credit history or income is limited. Upgrade tends to be a bit more flexible for fair credit and offers longer repayment terms, which can make budgeting easier.

Upstart personal loans

Upstart is a lending platform that connects borrowers to banks and credit unions that originate loans. Its network currently includes more than 100 financial institutions. Using artificial intelligence models, Upstart reviews each applicant's eligibility based on thousands of factors that predict the potential for default. As a result, you may have a better chance of approval with Upstart compared to lenders that utilize traditional underwriting, even if your credit score isn't great. Plus, the minimum income requirement is a low $12,000 per year.

Upstart personal loans range from $1,000 to $75,000 with 6.60% to 35.99% APRs. Depending on the lender that originates your loan, you could pay an origination fee between 0% and 12%. You can use your Upstart personal loan for almost any purpose aside from illegal activities (Upstart offers separate loans for auto financing). In most cases, Upstart funds loans on the business day following approval. Note that unlike Upgrade, Upstart does not offer joint loans or discounts for autopay or direct pay to creditors (for debt consolidation loans).

Upgrade personal loans

Upgrade is a fintech company that partners with Cross River Bank and Blue Ridge Bank to furnish personal loans from $1,000 to $50,000. The company also offers checking and savings accounts, rewards-focused credit cards, Flex Pay (a loan app), and credit health monitoring tools.

Upgrade personal loans come with fixed APRs of 7.99% to 35.99% and origination fees between 1.85% and 9.99%. You can use an Upgrade personal loan for debt consolidation, home repairs, and other major expenses, but Upgrade doesn't allow loan funds to go toward college tuition, investments, gambling, or illegal activities. As with Upstart, Upgrade loan funds usually arrive in one business day.

Learn More: How to Get a Personal Loan Using Credible’s Marketplace

Tips on choosing between Upstart and Upgrade

Below, we break down important differences between Upstart vs. Upgrade to help you decide which one matches your loan needs better.

APRs and average rates

Winner: Upgrade (for good and very good credit)

Tie (for fair credit)

The annual percentage rate, or APR, for Upstart ranges from 6.60% to 35.99%, meaning your interest rate could fall anywhere in between. Upgrade's APR range is 7.99% to 35.99%. Generally, lenders reserve the lowest rates for borrowers with excellent credit, so if your credit score is 800 or above and you have an income sufficient to make personal loan payments, you could qualify for a lower rate with Upstart.

We found that fair-credit borrowers received nearly equal rates, on average, between the two lenders. However, we found that borrowers with very good and good credit scores received lower rates with Upgrade. Average rates are based on 12 months of closed loans data from both lenders on the Credible personal loan marketplace.

Minimum credit score

Winner: Upstart

Upstart requires a minimum 300 credit score in most states, if you're applying directly through the lender's site. If applying through Credible, however, you'll need at least a 620 credit score, while Upgrade requires a minimum 580 credit score.

Loan purpose

Tie

Both online lenders allow you to borrow personal loans for various reasons, including:

• Debt consolidation
• Credit card refinancing
• Home improvement or repairs
• Major purchases, like a wedding

Upstart is a little more lenient with acceptable loan uses, though, essentially only banning the use of a loan for illegal activities. Upgrade has the same restrictions but also prohibits using personal loan funds for tuition, investments, and gambling.

Repayment terms

Winner: Upgrade

An Upstart personal loan has a repayment term of three or five years. Upgrade offers more flexible schedules, with repayment terms between two and seven years, giving you more time to pay off your loan if needed, and potentially lower monthly payments.

Loan amount

Winner: Upstart

Upstart lets you borrow between $1,000 and $75,000, although some states have higher minimum borrowing amounts ($7,000 in Massachusetts, for example). Upgrade's loan amounts range from $1,000 to $50,000.

If you have a significant amount of debt to consolidate or expenses to pay for with your loan, Upstart can give you some more wiggle room to borrow. But if you want to minimize your monthly payments, Upgrade may be a better option due to its longer repayment terms.

Time to fund

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In most cases, both Upgrade and Upstart send your loan funds within one business day of your approval, but your bank may take a couple of business days to clear the transaction. Both lenders had average funding times of two days, according to 12 months of Credible personal loans data.

Related: How Long Does It Take To Get a Personal Loan?

How to apply for a personal loan

The process to apply for a personal loan through Upstart, Upgrade, and other online lenders is relatively similar. Here's what to do:

1. Use Credible's free credit monitoring tool to check your credit score and determine which lenders you may qualify for. Check your credit report for free at AnnualCreditReport.com.
2. Prequalify for a loan on the lender's website or through Credible's loan marketplace to compare rates and terms you may be eligible for. This only involves a soft credit check.
3. Compare prequalified loans and choose the one with the monthly payment and total repayment amount you feel comfortable with.
4. Apply with the lender offering your preferred loan. When you apply, the lender will run a hard credit check to make sure you qualify, which can temporarily lower your credit score by a few points.
5. Carefully review the loan agreement the lender sends you upon approval, and sign it if you agree to all terms.
6. Get your loan funds according to your lender's timeline, which is usually within two business days for Upgrade and Upstart.

Which lender is best for you?

Upstart and Upgrade have similar requirements and benefits for borrowers, but there are some cases where one lender might work better for you than the other.

Best for large loans: Upstart

Upstart allows larger borrowing limits than Upgrade ($75,000 versus $50,000), so it's a better option if you need to borrow more than $50K. Just keep in mind that qualifying for a larger loan amount may require a strong credit profile and higher income.

Best for flexible repayment terms: Upgrade

If you want to stretch your loan payments over several years, Upgrade may be your best choice. It offers repayment terms of up to seven years. Meanwhile, Upstart only gives the option of three- and five-year loans, which doesn't give you as much room to customize your loan for your budget.

Learn More: Personal Loan Term Length: What You Need To Know

Best for fair credit: Upgrade

Upgrade and Upstart both consider your full credit and financial profile rather than just your credit score, so someone with fair credit may qualify with both. Plus, you can potentially get a secured loan with either lender. However, Upgrade also offers joint personal loans, unlike Upstart, which can make it easier to qualify or lower your rate.

Upgrade also offers discounts for autopay and direct payment to creditors (for debt consolidation).

Best for low-income borrowers: Upstart

Upstart requires borrowers to have a minimum income of $12,000 per year, which is lower than many other lenders look for. For comparison, Upgrade requires a minimum income of $25,000. The lower income threshold could benefit students, part-time workers, or borrowers with limited earnings who still need access to a personal loan.

Learn More: Best Low-Income Personal Loans

Best for joint applications: Upgrade

Some borrowers may want to apply for a personal loan with another applicant to improve their approval chances or qualify for a bigger loan or better terms. Upgrade is the only one of these two lenders that allows joint applications.

Learn More: Co-applicant vs. Cosigner: What's the Difference?