Avant personal loans: 2017 comprehensive review

Avant.com

Avant offers unsecured personal loans for borrowers with less-than-perfect credit scores. If you qualify, you’ll receive quick funding, often by the next business day.

Avant’s target borrowers have a credit score between 600 and 700. (That’s slightly below the national average.) Avant is competitive with other low-credit lenders, like OneMain Financial. But if you have damaged credit, you’re unlikely to qualify for the lowest rates.

Avant’s loans are ideal for consolidating debt or repairing credit. Borrowers with average credit scores can use an Avant loan to fund major expenses and boost their credit.

Table of Contents: Avant loans

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

Reasons to consider Avant loans

  • Loans range from $2,000 to $35,000
  • APR ranges from 9.95% to 35.99%
  • Loan lengths range from 24 to 60 months
  • Administration fees range from 1.50% to 4.75%
  • Simple online loan application process
  • Checking loan options won’t affect your credit score
  • No prepayment fees

Avant began charging an origination fee in late 2016, which it calls an administration fee, a surprising move given that Avant originally distinguished itself from competitors by offering fee-free loans.

Who is an Avant loan good for?

  • Someone with slightly below average credit. The average Avant customer has a FICO score of 650. The average FICO score is 695. As long as the loan terms are better than the interest rate on your credit card, Avant loans could be a good option to pay off and consolidate credit card debt.
  • Someone with a modest income. The typical Avant borrower has an average annual income of at least $40,000. Real median household income in the U.S. is about $59,039.
  • Those who need some flexibility in their payments. Avant will forgive a late payment after you have three consecutive on-time payments.

Who should not accept a loan

  • Anyone with good or better credit. If you have a credit score above 700, you may qualify for better rates elsewhere.
  • Anyone who needs a co-borrower. Avant, like many online 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 company.
  • Anyone looking for a face-to-face experience. Avant’s loan process is entirely online. If you want to speak with a representative, you’ll have to do so over the phone.
  • Anyone with bad credit. If your credit is exceptionally weak, you may be quoted double-digit interest rates on your Avant personal loan. Those interest rates may not be any better than you’re paying on your credit card today. Learn more about loans for people with bad credit.

Lending terms

Avant loans range from $2,000 to $35,000, although the minimum loan varies by state.

The quote you receive is based on multiple factors, including:

  • Credit history
  • Debt-to-income ratio
  • Loan amount
  • Repayment term (36 vs. 60 months)
  • Employment history
Avant borrower snapshot
Borrower average
Loan size $8,000
Income $40,000 to $100,000
Credit score 580

Avant charges an administration fee that is built into the monthly payments. For example, if you are approved to borrow $6,500 and you’re charged a 4.75% administration fee, you’ll only receive $6,191.25. Keep in mind, though, that you’ll be making payments on the entire $6,500. You should factor the origination charge when calculating the total amount you’re looking to borrow.

If the loan is approved, funds can typically be accessed within the next business day or two.

Unlike most other firms, Avant offers a late-fee forgiveness program. If you make a late payment, which averages around $25, Avant will refund this charge after you make three on-time payments in a row.

Minimum borrower requirements

Avant borrowers typically have a minimum FICO score of 580. Borrowers must also be over 18 years of age, have valid identification, and access to a bank account that accepts ACH (or electronic) transfers.

According to the company, most applicants have a FICO score between 600 and 700. Avant will verify income information either through your employer or, if you’re self-employed, it may ask you to submit your previous tax returns to verify your income.

Fees and penalties

  • Avant charges an origination fee that ranges from 0.95% for refinance customers and 4.75% for new customers.
  • You’ll be charged on average a $25 late fee, although the actual amount varies by state. Avant has a late-fee forgiveness program that will refund the late payment fee after three consecutive on-time payments.
  • You’ll be charged $15 if you don’t have enough money in your bank account to cover your monthly installment.
  • You won’t be penalized for paying off your loan early.

How to apply for Avant loans

The online application is simple to follow.

Here’s what you’ll need to apply for a loan with Avant:

  • Personal information (includes address, phone number, email, and SSN)
  • Monthly net income
  • Monthly housing payments
  • Loan amount
  • Credit score
  • Loan reason

Avant then does a “soft” credit check, to quote you loan rates, which won’t impact your credit rating.

If you’re approved, the online calculator displays a chart with individualized options, including the fixed monthly payment due on different loan length ranges and the interest rates for each.

How Avant compares
Avant OneMain
Loan size $2,000 to $35,000 $1,500 to $25,000
APR range 9.95% to 35.99% 9.99% to 35.99%
Origination fee 4.75% Varies by state
Minimum credit score 580 No minimum
Time to funding 1 to 2 business days Same day
Soft credit check with application? Yes Yes

After you choose a repayment option, you’ll be shown the details, including the total amount of the loan, what Avant is subtracting as an origination fee and how much will be deposited into your account.

The last steps are to electronically sign for your loan and provide your bank information for the deposit. You can opt for automatic monthly debits or remotely created checks.

Before finalizing your loan, Avant will do a “hard” credit check, which can adversely impact your credit score.

The process is uncomplicated and straightforward, and the site is easy to navigate and read. It takes approximately one to two business days for the funds to be deposited in your account.

What to do if you’re turned down

If you’re unable to qualify, or if you only qualify for one of Avant’s highest-rate loans, which is close to 36%, consider the following:

  • Lower credit-friendly lenders like OneMain Financial
  • Secured credit cards to help rebuild credit

If Avant rejects your application and you believe your financial standing is strong enough, consider requesting the reason for decline. Avant will follow-up with an email. 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.

A brief history of Avant

Avant was founded in 2012, specializing in loans to borrowers with average credit. Since then, they’ve funded almost $2 billion in loans, and have developed an international presence.

“While many competitors in the industry have focused on prime or super-prime customers, few platforms have concentrated on the near-prime customer — those with a credit score in the 600-700 range,” company spokesman Carolyn Blackman Gasbarra says. “This customer demographic represents 40% of the population and provides Avant with a massive opportunity to provide credit to a historically underserved borrower.”