Lending Club Personal Loans Review 2019

Lending Club Personal Loans Review 2019
Rebecca Hosley
on March 16, 2020
Read in 3 min

Founded in 2007, online loan company LendingClub is a pioneer when it comes to peer-to-peer lending, also known as marketplace lending.

Peer-to-peer personal loans connect prospective borrowers directly with investors willing to lend money – eliminating the need for a bank to act as the go-between.

Investors make money on the interest charged while borrowers benefit from rates that are typically lower than a traditional bank loan.

Let’s take a closer look in our LendingClub review to learn more about how installment loans work in peer-to-peer lending, and if they might be the right fit for your borrowing needs.

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LendingClub Review: Connecting Investors and Borrowers

LendingClub doesn’t lend money directly to borrowers.

Instead, it acts as the facilitator by screening potential borrowers, handling the logistics, and servicing the loan.

To date, the company has helped more than 1.5 million customers borrow more than $28 billion.

RELATED: LendingClub Business Loans Review

Consumers can request personal loans online from $1,000 up to $40,000 for projects such as:

  • home improvements,
  • paying off credit cards,
  • vacations,
  • moving expenses,
  • & car financing.

If you are curious as to what rates you might qualify for, you can fill out the request without impacting your credit score.

It is only visible to LendingClub and the borrower, not other creditors or anyone else accessing your credit report.

How Personal Loans are Financed with LendingClub

The request process is straightforward and takes place entirely online.

Simply fill out the request form and answer a few financial questions, including how much you would like to borrow, the purpose of the loan, and your salary and income details.

LendingClub then reviews your request and assigns you a grade based on your:

  • Employment
  • Income
  • Credit score
  • Debt-to-income ratio
  • & Credit history

Grades range between A1 (highest grade, lowest rate) and G5 (lowest grade, highest rate).

Your grade is then used to determine the interest rates you qualify for.

Investors can then review the criteria in your request, as well as the grade assigned to you, and decide if they are willing to lend you the money.

Borrowers can typically choose from several offers with varying:

  • Loan amounts
  • Interest rates
  • Monthly payments
  • Loan terms of either 36 or 60 months

For the best deal, you should compare this offer to those of other lenders, and choose the loan option that best fits your needs.

Once you accept an offer, the money is directly deposited into your bank account.

You should know that if you need instant access to funds, you may want to look elsewhere since receiving funding through a LendingClub loan can take up to one week.

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LendingClub By the Numbers

Now that you know how peer-to-peer loans are financed by LendingClub, let’s look at some other details, including interest rates and fees.


Depending on your credit history, APR rates can range from as low as 4.99% for borrowers with excellent credit, all the way up to 35.89% for borrowers who are deemed higher risk.

A select group of debt-consolidation borrowers may also qualify for the option to pay off creditors directly by using up to 80% of their loan to pay off their outstanding debt.


While there are hidden fees in the rates, or for paying the loan off early, there are a few fees that potential borrowers should be aware of, including:

  • An origination fee of 1% to 6% of the loan amount, depending on the grade assigned to the borrower.
  • Personal-check processing fee of $7.
  • Unsuccessful payment fee of $15.
  • Late fees of $15 or 5% of the payment due, whichever is higher.

One way to avoid some of these fees if you are facing a temporary financial struggle is by taking advantage of LendingClub’s hardship plan.

This allows borrowers to take a break from paying down the principal and making interest-only payments for three months.

This can help borrowers to catch up and get back on their feet financially.

Joint Borrowers

Unlike many online lenders, LendingClub also allows joint loan requests.

To qualify for a joint loan one borrower must have a score of at least 600, while the other borrower needs to have a credit score of at least 540.

In addition, the maximum combined debt-to-income ratio for the two borrowers needs to be lower than 35%.

Other benefits of a LendingClub loan include:

  • Fixed monthly payments.
  • Low, fixed-interest rates that contain no hidden fees.
  • The ability for payments to be automatically debited from your bank account.
  • No penalties for prepayment of the loan.

Who Qualifies for a Personal Loan from LendingClub?

In order to be considered for a loan from LendingClub, you need to have a good credit score.

The minimum acceptable score to qualify is 600, with most borrowers averaging closer to 700.

The company will also be looking for:

A lengthy credit history.

The minimum credit history you’ll need to qualify is three years, but the average borrower has more than 15 years of credit history.

A higher-than-average income.

The typical American median household income is $55,775, however, the typical LendingClub borrower comes from a household with a median income of more than $75,000.

A low debt-to-income ratio.

The average LendingClub borrower has a ratio of 18.32%, excluding mortgage, with the maximum ratio allowed topping out at 40%.

While there is no magic number, the lower your ratio, the better your chances of getting approved at a competitive interest rate.

Final Thoughts

The bottom line is that LendingClub may be a good option for people with a long history of good credit and a healthy salary.

If you have poor credit or a household income below $60,000, you may want to consider other lenders, since LendingClub investors may be hesitant to lend you the money.

Even if they do, you may only qualify for a high-interest rate loan.

We hope you found this LendingClub review helpful.

If you’re interested in connecting with a lender, you can get started with our easy online form here:

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Rebecca Hosley Finance Journalist

Rebecca Hosley is a content writer based in Chicago.

She frequently writes about small business, insurance and finance.

In her free time, she enjoys trivia, craft beer and disc golf.