Pave comprehensive loans
Courtesy of Pave

Pave is a personal loan company that weights an applicant’s future earning potential as much as their credit history.

This makes a Pave loan a potentially good choice for millennials who may have thin credit files but big ambitions. According to company co-founder and CEO Oren Bass, “Our underwriting is tailored to a younger demographic.”

Pave’s typical borrower is someone to who wants to use the money to take a course, relocate for a job or pay down credit card debt.

Who is this loan good for?
Lending terms
Minimum borrower requirements
Fees and penalties
How to apply
What to do if you’re turned down

Because the screening process for its unsecured personal loans is entirely virtual, there are fewer loan underwriting costs, which means Pave may be able to offer better interest rates and quicker turnaround times than brick-and-mortar lenders.

Who is a Pave personal loan good for?

  • Anyone with good to excellent credit. Pave borrowers have an average credit score of 700. The minimum credit score required is 660, according to the company. Check your credit score for free before you apply.
  • High-income earners. Pave borrowers have an average annual income of $80,000. Real median household income in the U.S. is about $56,500.
  • Someone who doesn’t need a co-borrower. Pave, like many other lending platforms, does not allow joint borrowers on a single loan. If your credit or income aren’t good enough to qualify on your own, you may want to consider using a different lender.
  • Consumers with a low debt-to-income ratio. That’s the amount of debt you have compared to your gross monthly income. Cash flow is an important factor in determining your eligibility for a loan with Pave. Calculate your debt-to-income ratio before applying.

Who should not accept a loan

  • Anyone with bad credit. If you have less-than-stellar credit and you’re quoted an annual percentage rate higher than your credit card charges along with a steep origination fee, you may be better off with a different type of loan.

Consider applying for a balance transfer credit card or a home equity loan if either of those offer more favorable terms.

Lending terms

When you get a loan from Pave, you’re not actually getting the money from Pave. The actual lender is Cross River Bank, an FDIC-insured institution based in Fort Lee, New Jersey.

Pave acts as a broker, matching investors with would-be borrowers. It charges an origination fee for its matchmaking services. Think of it like an application fee or a processing fee — a sunk cost that may or may not seem reasonable, but it’s non-negotiable. Some, but not all lenders, charge this fee.

Pave offers loans that range from $3,000 to $25,000. Its personal loans carry a fixed annual percentage rate of between 7.18% and 29.65%, meaning it will never adjust up or down throughout the life of the loan. The quote you receive is based on multiple factors, including cash flow, credit history, the amount you’re asking for, and if you want 24 or 36 months to pay it off.

The loan term length is one thing to consider. Other lending platforms will give borrowers up to five years to repay a loan.

Pave borrower snapshot
Borrower average
Loan size $13,000
Annual percentage rate 13.5%
Income $80,000
Credit score 700

Pave’s origination fee – which ranges from 1% to 6% — is an upfront cost taken off the top of the loan. The fee varies depending on the terms of your agreement. For example, if you are approved to borrow $10,000 and you’re charged a 3.5% origination fee, you’ll only receive $9,650. Keep in mind, though, that you’ll be making payments on the entire $10,000. You should factor the origination charge when calculating the total amount you’re looking to borrow.

Once approved for a loan, you should receive the funds in your bank account by the next business day.

Minimum borrower requirements

The minimum credit score to borrow is 660, but that’s not the only factor Pave considers in evaluating an application. Pave also will take into account information:

  • A customer provides on their loan application, including future income potential or job offers, if you’re taking a course for professional development.
  • Provided by credit bureaus and other information that predicts the likelihood that you’ll make on-time payments.

You have to be at least 18 years of age, a U.S. citizen and have a valid bank account to apply.

Pave weighs potential and cash flow more heavily than a credit score, Bass says.

Fees and penalties

  • Pave charges an origination fee of 1% to 6%.
  • You’ll be charged $2 if you pay by check. There is no fee if you set up an ACH debit through your bank account.
  • You’ll be charged $15 if you don’t have enough money in your bank account to cover your monthly installment.
  • Late payment fee is either 5% of the unpaid installment amount or $15, whichever is greater. A 15-day grace period is included.
  • You won’t be penalized for paying off your loan early.

How to apply

The application process is straightforward and fast. Enter some basic information in the online application, including if you’re using the money to take a course, what type of course, the amount you’re looking to borrow and other basic identifying information. You’ll also need to grant Pave access to your bank account information so the company can review your cash flow as part of its loan consideration process.

Pave then will conduct a “soft” credit check, which won’t impact your credit rating.

If you’re approved, Pave will contact you and review the terms of your loan. The whole process takes on average a day or two.

How Pave compares
Pave SoFi
Loan amounts $3,000 to $25,000 $5,000 to $100,000 in most states
APR range 7.18% and 29.65% 5.70% to 14.24% in most states
Origination fee 1% to 6% None
Minimum credit score 660 None
Time to funding Next day Several days
Soft credit check with application? Yes Yes

Before finalizing your loan, Pave, like all lenders, will do a “hard” credit check, which can adversely impact your credit score.

What to do if you’re turned down

If Pave rejects your application and you believe your financial standing is strong enough, consider asking for clarification. The explanation could be as simple as a processing error. Or there may be a negative mark on your credit report that you need to investigate.

If your credit is lower than 660, consider applying for a personal loan at Avant, OneMain Financial or a credit union. You may find more favorable rates and fewer lending restrictions.

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