Avant Personal Loan Review
Personal loans offer a quick solution to urgent personal financial issues. With a good credit score, one can qualify for dozens of personal loans with suitable repayment plans. But what about the individuals with below-average credit scores? What options do they have?
Various companies have specialized in providing personal loans to the below-average credit score market. The issue, however, is that most of these companies take this opportunity to increase the fees involved in borrowing and repaying the loans. Individuals with poor credit scores are considered as a risky market because the likelihood for defaulting is very high.
Avant brags themselves as being among the best lenders who offer loans with reasonable terms to people with credit scores as low as 580. According to the president of Avant Adam Hughes, the company is dedicated to providing decent personal loans to the “typical middle-class American.”
How decent are the loan terms though and how well do they compare to other alternatives?
Avant Personal Loan Overview
Avant is an online lender that offers some of the best personal loans for individuals with poor to below average credit scores. This basically means that Avant focuses on the market where consumers don’t have many options in terms of loans. Even though Avant claims that they have no minimum requirements, our research showed that individuals with credit scores of at least 580 are the ones with the highest chances of qualifying for the loans. While this may lock out some individuals, it is still quite favorable because most other online lenders have minimum credit score requirements of between 620-680.
Since Avant is an online lender, checking your eligibility and applying for the loan is pretty easy. Also, if you apply and qualify for the loan, you will receive the funds within two business days. Managing your loan is also very simple. This can be done online through their website or via their mobile application.
Avant is also a good option due to its flexible loan repayment plans. You can borrow between $2,000 to $35,000 from this lender. The terms will also range from 2 to 5 years depending on the amount borrowed and several other factors. We also have to mention that Avant allows its customers to adjust upcoming payments one day before the due date! This kind of flexibility will help you to avoid late payment penalties.
Avant offers various options when it comes to the method of repayment, and you won’t be charged any fees for choosing one particular method over the others as is the case with most lenders. The first option is to enroll in their auto-pay program. This convenient method will make sure that the balances due are automatically deducted from your account. It’s a decent option because it also eliminates the possibility of one forgetting to pay the monthly balances. You can also pay through your bank account either automatically or by creating a check remotely. The other options include debit or credit card, cashier’s check, personal check or money order.
The challenge that comes with most personal loans that are easy to qualify for is the APRs involved. For instance, Avant personal loans come with APRs of between 9.95% to 35.99%. The exact APR that will be applied on your loan will depend on your credit score, financial history, and income. The APRs here are very high especially if you have a credit score of 640 or higher. For people with poor credit scores, these APRs may be a bit fair, and that’s simply because their options are limited and other companies usually have much higher interest rates with some payday lenders charging as high as 300% in APR! If you have a fairly good credit score, you should definitely avoid Avant personal loans because even though they’re flexible, you will end up losing a lot of money through interest rates.
Other than APR, Avant will also charge you a 4.75% origination fee that will be deducted from your loan. Unlike most other personal loans, Avant personal loans don’t have a prepayment fee, and hence you can clear the loan in advance without any additional charges.
There is also a late payment fee of $25. This will be applied every time you fail to make your monthly payments on time. On the brighter side, Avant has a late payment fee forgiveness plan which is issued to all users who make at least three consecutive payments on time before making one late payment.
Avant personal loans will also be charged a returned payment fee or NSF of $15.
Avant Personal Loans Eligibility
You must meet the following requirements to qualify for an Avant personal loan:
- Be a United States citizen or a permanent resident
- Be at least 18 years old (Alabama residents must be at least 19 years old)
- Be in an eligible state
- Have a FICO score of at least 580
- Valid bank account
If you qualify for the personal loan, Avant will analyze your application info, credit history and the reason for applying for the loan. They will then evaluate your ability to repaying the loan before they present several loan offers to you.
How to apply for an Avant Personal Loan
To apply for an Avant personal loan, you must first create an account through their official website. You are required to provide details including your email, physical address, social security number, phone number, monthly income, and estimated credit score. You will then proceed to give information on the loan amount you need and the purpose of taking the loan.
After evaluating all the details, Avant will provide you with multiple loans offers that you can choose from. After selecting one, you’ll be required to upload documentation for identity verification. It is also at this point where Avant will pull a hard credit check which might affect your credit score. If everything checks out, your personal loan will be finalized.
The funds may be deposited to your bank account within a single business day if your loan is approved between Monday to Friday before 4:30pm CT.
Avant may be a favorable option for you due to the following benefits:
- The website allows you to check your loan options and some of the terms attached to the loans before making your application. This will enable you to avoid unnecessary credit checks which may affect your credit score.
- Applying for the loan is very convenient since the entire application process is done online.
- The turnaround time is quick. The funds will be deposited in your account within one business day after your approval.
- You can avoid paying interest rates by prepaying the loan, and the best part is that you won’t be charged prepayment fees.
- Avant personal loans can be used for different purposes including debt consolidation and home renovation. Avant personal loans can’t be used for business financing though.
- You can enroll for automatic payments through the Automated Clearing House.
- The high APRs make Avant personal loans a decent option to people with poor credit scores, but if you have a fairly good FICO score, you can get much better loan offers somewhere else.
- All Avant personal loans are also eligible for a 4.75% administrative fee.
- The maximum amount you can borrow from Avant is $35,000 which is quite low compared to other lenders.
- Avant personal loans are not available for people living in Vermont, Colorado, West Virginia and Lowa.
Avant Personal Loans Competitors:
We compared Avant personal loans to other lenders in the market and came up with the following summary:
Avant vs. Prosper
Prosper is a peer-to-peer lender that offers up to $40,000 in personal loans. This is more than the maximum loan amount that you can get from Avant. Prosper also charges better interest rates compared to Avant. These range from 6.95% to 36%. This makes them a better option compared to Avant. However, you will need a credit score of at least 640 to qualify for Prosper loans. Your debt-to-income ratio must also be below 50%.
Prosper offers terms of between 3 to 5 years. They will decide the terms extended to your loan depending on the amount borrowed and other details. Just like Avant, Prosper loans have an origination fee, but they don’t charge prepayment fees.
Avant vs. LendingClub
LendingClub is another peer-to-peer lender that offers excellent loans for debt consolidation. You can even choose to pay your creditors directly via LendingClub. They provide personal loans of up to $40,000 with interest rates ranging from 6.95% to 35.89%. This is better than what Avant has to offer.
To borrow from this lender, you need a minimum credit score of 600 which means that fewer people qualify for this loan as compared to Avant. Also, the turnaround time of LendingClub loans can take one week or even more.
Avant personal loans are a good option if you have a poor credit score. Their turnaround time is more than convenient, and they also provide flexible repayment terms that you will hardly find with other lenders within this category. Unfortunately, the high APRs make it a bad option for everyone with a good credit score. Therefore, if you have a FICO score of 620 going up, we’d recommend that you shop around and get a lender with better interest rates.
David is a financial expert who graduated from the University of Fordham (Master in Finance) in 2001. He has 10+ years of experience in private equity and wealth management. With strong expertise in senior-level financial planning, personal financial analysis, and mortgages, David knows his way around personal finance. Before working at CCR he used to be a financial analyst at McKinsey.
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