Is Upstart a scam?
Upstart is not a scam. It is an online lending marketplace that helps match consumers with loans from banks and credit unions in its network. It has helped over four million customers and it has originated over $53 billion in funding. It’s licensed with the Nationwide Multistate Licensing System (NMLS) (NMLS #936133), and it’s licensed in 22 states and Washington, D.C.
AI lending model
Upstart is known for using artificial intelligence (AI) to help inform its loan decisions. It states that it uses AI to help predict the odds of default and prepayment and to detect fraud. For lenders within its network, it promises that its AI lending model provides more advanced risk analysis and faster loan approvals, with 91% of its loans being fully automated.
No-action letters
The Consumer Financial Protection Bureau (CFPB) issued two no-action letters (NALs) to Upstart in 2017 and in 2020, both of which were related to its use of AI in underwriting. In response to the 2017 NAL, Upstart agreed to regularly report lending and compliance information to the CFPB. The 2020 NAL required Upstart to notify the CFPB of changes to its AI model. In 2022, the CFPB terminated the NAL in response to a request from Upstart, which intended to update its AI model.
According to the CFPB, no-action letters give companies special regulatory privileges related to specific matters, and the issuing agency agrees not to take legal action for violations. It doesn’t mean that the issuing agency will refrain from supervising activities. The CFPB also states that the goal of its no-action letter program is to support innovation and emerging technologies while mitigating risk to consumers.
Banking partner failure
In March 2023, Upstart’s primary banking partner, Silicon Valley Bank, failed. However, its personal loan offerings did not appear to be affected.
» RELATED: Are online loans safe?
Pros and cons of using Upstart
Before taking out a loan with Upstart, make sure you consider the pros and cons.
Pros
- High maximum loan amount
- May accept lower credit scores
- Fast funding
Cons
- High origination fees
- Lending marketplace, not a direct lender
- Limited term lengths
What Upstart customers say
Upstart's personal loan reviews are mixed, though it’s important to note that ConsumerAffairs currently has a limited number of reviews for Upstart. Many customers said they were satisfied with its competitive rates and the ease and speed of the loan process, while others reported issues with customer service and on-time payments.
Recent Upstart reviews
Some ConsumerAffairs reviewers were happy with their Upstart experience.
“I was pleasantly surprised by how quickly I received a decision on my loan,” said Sherri, a reviewer from California. “Within 24 hours, I received an email letting me know that I was approved for the loan and detailing the terms and interest rate. The interest rate was also much lower than I had anticipated, which was another bonus.”
Other reviewers, such as Aaron, a reviewer from Massachusetts, said they were initially happy with their experience, but that they were dissatisfied with Upstart after they paid off their loan early.
“I felt Upstart was good at first, but once I paid my loan off early[,] I can tell they were no longer interested in my business,” Aaron said. “This is a clear practice for predatory lenders looking to focus on tying people up with high interest loans that never end. It's a shame because the website and service are user friendly and they are timely [with] reporting to credit bureau[s].”
Upstart loan requirements and eligibility
Upstart reports that it doesn’t have a minimum credit score requirement in most states, so it may lend its products to consumers with a range of credit scores, including people with fair or bad credit. It may even accept consumers with limited credit histories. This is because Upstart evaluates more factors than just credit scores for loans. It also considers debt-to-income (DTI) ratios, educational background and employment history.
Still, each lender determines its minimum credit score, and consumers will generally have the best odds of approval with a good to excellent credit score. Consumers with good to excellent credit scores will also qualify for the best rates and terms.
Compare Upstart with other personal loan companies
Compared to other personal loan lenders, Upstart offers a higher maximum loan amount, and it may accept credit scores in the fair or poor range. However, it offers fewer term lengths than other lenders.
| Company | Customer rating | Loan amount range | Term lengths | |
|---|---|---|---|---|
 Upstart | Compare Offers | 3.1 | $1,000 to $75,000 | 3 or 5 years |
 Upgrade | Compare Offers | 4.5 | $1,000 to $50,000 | 2 to 7 years |
 Best Egg | Compare Offers | 4.5 | $2,000 to $50,000 | 3 to 5 years |
 NetCredit | Compare Offers | 4.9 | $1,000 to $10,000 | 6 months to 5 years |
 Reach Financial | Learn More | 2.0 | $3,500 to $40,000 | 2 to 5 years |
» RELATED: Upgrade vs. Upstart
FAQ
What credit score do I need to qualify for an Upstart loan?
For the best odds of qualifying for an Upstart loan, you’ll typically need a fair credit score or better. However, it’s possible Upstart may accept borrowers with credit scores as low as 300 or with a limited credit history.
How quickly can I get my funds from Upstart?
If approved for a loan, you may be able to get your funds as soon as the next business day after signing your loan agreement.
Does Upstart charge any hidden fees?
Upstart doesn’t charge any hidden fees. All fees should be clearly disclosed in your loan agreement. It typically charges an origination fee, and it may charge a late payment fee. It doesn’t charge any prepayment penalties.
Does an Upstart loan affect your credit score?
Applying for an Upstart loan will cause your credit score to drop temporarily since Upstart will perform a hard credit check. However, opening a loan can improve your credit mix, which can help increase your credit score. Over time, on-time payments can also help to improve your credit score.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Consumer Financial Protection Bureau, “CFPB Announces First No-Action Letter to Upstart Network.” Accessed March 20, 2026.
- Consumer Financial Protection Bureau, “CFPB Issues Order to Terminate Upstart No-Action Letter.” Accessed March 20, 2026.
