Considering a Lendly loan? This online lender specializes in small personal loans from $1,000 to $2,000 with typical APRs around 225%, repaid through automatic payroll deductions over 26 bi-weekly payments. While the fast application could appeal to those needing quick cash, the extremely high interest rates make exploring alternatives an absolute must.
This review covers:
- How Lendly loans work
- The pros and cons
- A sample repayment schedule
- How Lendly compares to top competitors
- Tips for getting the best rate if you do decide to borrow from them
What is Lendly?
Lendly is an online lender that specializes in offering small loans ranging from $1,000 to $2,000. So, if you find yourself in need of some extra cash, Lendly might be an option to consider.
One thing that sets Lendly apart from some other lenders is the way they handle repayments. In most cases, you’ll pay back your Lendly loan through automatic payroll deductions. Basically, a portion of your paycheck will go directly to Lendly to cover your loan payment before you even see the money in your bank account. This can be convenient for some folks because it reduces the risk of missing a payment.
Now, it’s important to note that Lendly doesn’t offer their loans in every state. Currently, they operate in 22 states, so you’ll want to make sure they service your area before applying. Lendly loans are available in the following states:
- Alaska
- Alabama
- Arizona
- Arkansas
- Delaware
- Florida
- Idaho
- Indiana
- Kentucky
- Louisiana
- Michigan
- Mississippi
- Missouri
- Montana
- Ohio
- Oklahoma
- South Carolina
- Tennessee
- Texas
- Utah
- Wisconsin
- Wyoming
So, if you’re a resident of one of these states and in need of a small personal loan, Lendly might be worth looking into.
Not so sure about Lendly Loans? There are other online lending platforms you can consider. Read these articles to know more about them.
How Lendly Loans Work?
Let’s break down how Lendly loans work, shall we?
First off, the application process is entirely online, which means you can apply from anywhere with an internet connection. Whether you’re at home, at work, or on the go, you can fill out the application in just 5-10 minutes. It’s that simple!
Now, let’s talk about the loan itself. Lendly offers loan amounts ranging from $1,000 to $2,000, which can be a real lifesaver if you’re facing an unexpected expense or need a little extra cash to tide you over until your next paycheck.
However, it’s important to keep in mind that these loans come with a higher interest rate than some other options out there. The typical Annual Percentage Rate (APR) for a Lendly loan is around 225%, so you’ll want to make sure you can afford the payments before signing on the dotted line.
When it comes to repayment, Lendly has a pretty unique setup. Instead of making monthly payments like you would with a traditional loan, you’ll typically make bi-weekly payments over the course of about a year.
On average, a Lendly loan is repaid over 26 bi-weekly payments, which are automatically deducted from your paycheck through payroll direct deposit. This means that a portion of your paycheck will go directly to Lendly to cover your loan payment before the money even hits your bank account.
Now, I know what you might be thinking – “What if I don’t want my loan payments coming out of my paycheck automatically?” Well, depending on where you live and who you work for, you may have other repayment options available. But for most folks, the payroll direct deposit is the primary way to pay back a Lendly loan.
Pros and Cons of Lendly Loans
| Pros | Cons |
|---|---|
| Fast and easy online application process (5-10 minutes) | High interest rates (typical APR around 225%) |
| Quick funding (money can be deposited as soon as the next business day) | Limited availability (only offered in 22 states) |
| May consider applicants with less-than-perfect credit | No prequalification option (hard credit inquiry required, which can impact credit score) |
| Automatic payments can help avoid missed payments and damage to credit score | Less control over cash flow due to automatic payroll deductions |
| Need to budget carefully to afford other expenses with reduced paycheck |
Let’s weigh the pros and cons of Lendly loans to help you decide if this type of loan is right for your financial situation.
First, let’s talk about the positives. One of the biggest pros of Lendly loans is how fast and easy the application process is. You can apply online in just 5-10 minutes, and if approved, you could have the money in your bank account as soon as the next business day. This can be a real lifesaver if you’re facing an unexpected expense and need cash quickly.
Another potential benefit is that Lendly may be willing to work with folks who have less-than-perfect credit. So, if you’ve had some credit challenges in the past and have struggled to secure a traditional loan, Lendly might be an option to consider.
The automatic payment setup can also be seen as a pro for some people. With your loan payments being deducted directly from your paycheck, you don’t have to worry about remembering to make a payment each month. This can help you avoid missed payments, which can be damaging to your credit score.
Now, let’s talk about the potential drawbacks. The biggest con of Lendly loans is the high interest rates. With a typical APR around 225%, these loans can be quite expensive, especially if you’re borrowing a larger amount or taking longer to pay it off. It’s crucial to crunch the numbers and make sure you can afford the bi-weekly payments before committing to a loan.
Another downside is that Lendly loans aren’t available everywhere. They currently only operate in 22 states, so depending on where you live, you may not have access to this lending option.
It’s also important to note that Lendly doesn’t offer a prequalification process. This means you can’t check your potential rates and terms without undergoing a hard credit inquiry, which can ding your credit score slightly. Some other lenders allow you to get prequalified with just a soft inquiry, which doesn’t impact your credit.
Lastly, the automatic payroll deduction setup can be seen as a con for some folks. While it can help you avoid missed payments, it also means you have less control over your cash flow each payday. You’ll need to budget carefully to make sure you can afford your other expenses with a smaller paycheck.
Lendly Loan Review
The Good
First and foremost, the application process is a breeze. You can apply online in just 5-10 minutes, which is perfect if you’re in a pinch and need cash quickly. Plus, if you’re approved, the money can be deposited into your account as soon as the next business day. Talk about fast funding!
Another potential perk is that Lendly may be willing to work with folks who have had some credit challenges in the past. So, if your credit score isn’t quite where you’d like it to be, Lendly could still be an option worth exploring.
The automatic payment setup can also be a big plus for some people. With your loan payments being deducted straight from your paycheck, you don’t have to worry about remembering to make a payment each month. This can be a real lifesaver for anyone who has a tendency to forget due dates or struggles with budgeting. Plus, consistently making on-time payments can help boost your credit score over time!
Lendly also offers top-notch customer service, which is a major plus for many borrowers. Customers consistently praise Lendly’s representatives for being friendly, knowledgeable, and genuinely helpful throughout the loan process. Whether you have questions about the application, need help understanding your loan terms, or just want some reassurance, Lendly’s customer service team is there to support you every step of the way. It’s clear that they prioritize customer satisfaction and are dedicated to making the borrowing experience as smooth and stress-free as possible.
Lastly, the fact that you can apply for a Lendly loan online from anywhere is a major convenience factor. No need to take time off work or rearrange your schedule for an in-person appointment. You can apply from the comfort of your own home or even on your lunch break at work.
The Bad
Now let’s take a closer look at some of the potential drawbacks and negative aspects of Lendly loans.
The biggest red flag for many borrowers is the high interest rates. With a typical APR around 225%, Lendly loans can be incredibly expensive, especially if you’re borrowing a larger amount or taking longer to pay off your loan. It’s crucial to crunch the numbers and make sure you can afford the bi-weekly payments before signing on the dotted line, or you could find yourself in a cycle of debt that’s hard to escape.
Another major issue that borrowers have reported is trouble reducing the principal balance of their loans. Due to the high interest rates and the way the payments are structured, some customers have found that even after making on-time payments for months or even years, their loan balance hasn’t decreased significantly. This can be incredibly frustrating and demoralizing, as it feels like you’re throwing money at the loan without making any real progress towards paying it off.
On top of that, Lendly loans aren’t available everywhere. Currently, they only operate in 22 states, which means that depending on where you live, you might not even have the option to apply for a Lendly loan. This limited availability can be frustrating for folks who need fast cash but don’t have access to this particular lender.
It’s also worth noting that Lendly doesn’t offer a prequalification process. This means you can’t check your potential rates and terms without undergoing a hard credit inquiry, which can ding your credit score. Some other lenders allow you to get prequalified with just a soft inquiry, which doesn’t impact your credit, so it’s something to keep in mind if you’re shopping around for the best rates.
The automatic payroll deduction setup can also be a major con for some borrowers. While it can help you avoid missed payments, it also means you’ll have less control over your cash flow each payday. You’ll need to budget carefully to make sure you can afford your other expenses with a smaller paycheck, which can be stressful and limiting.
Customer reviews also highlight some other potential issues to watch out for. Some borrowers have reported difficulties with refinancing or getting approved for additional loans, even after making on-time payments on their initial loan. Others have complained about payments being deducted earlier than expected, which can throw off your budget and lead to overdraft fees if you’re not careful.
The Bottom Line
So, is a Lendly loan right for you? Let’s break it down.
If you need a small amount of cash quickly and don’t have the best credit, Lendly could be a viable option. Their willingness to work with borrowers who have had credit challenges in the past sets them apart from some more traditional lenders. Plus, if you have a steady paycheck that can support automatic bi-weekly payments, the repayment process might be more manageable for you than remembering to make monthly payments on your own.
However, it’s crucial to consider the significant drawbacks of Lendly loans before making a decision. First and foremost, these loans are an extremely expensive form of credit due to the high APRs. You could end up paying hundreds or even thousands of dollars in interest, which can keep you trapped in a cycle of debt if you’re not careful.
The automatic payroll deductions can also be risky, especially if you’re living paycheck-to-paycheck. If a large chunk of your income is going towards loan payments, you might struggle to afford other essential expenses like rent, groceries, or utilities. This can lead to a domino effect of financial stress and instability.
If you’re struggling to keep up with bills or expenses, it might also be worth reaching out to your existing creditors to see if they can offer a payment plan or temporary hardship assistance. Many lenders and service providers are willing to work with customers who are proactive about communicating their financial challenges.
Ultimately, the best way to avoid needing high-cost loans like those offered by Lendly is to focus on saving money and building a budget that works for your income and expenses. It’s not always easy, but by setting aside even small amounts of money each month and being mindful of your spending, you can start to build a financial cushion that can help you weather unexpected expenses without resorting to risky debt.
How Lendly Compares to Top Competitors
Lendly vs. LendingClub
LendingClub offers personal loans ranging from $1,000 to $40,000 with APRs between 9.57% and 35.99%. This is significantly lower than Lendly’s typical APR of 225%. LendingClub also offers longer repayment terms of 24 to 60 months, giving borrowers more flexibility compared to Lendly’s average repayment term of 26 bi-weekly payments.
One key difference is that LendingClub charges an origination fee between 3% and 8% of the loan amount, while Lendly doesn’t mention any origination fees. However, LendingClub’s overall cost of borrowing is still likely to be much lower than Lendly’s due to the substantially lower APRs.
LendingClub also offers a wider range of loan purposes, including debt consolidation, balance transfers, home improvements, and more. In contrast, Lendly seems to focus primarily on providing quick cash for short-term needs.
Lendly vs. Upstart
Upstart offers personal loans from $1,000 to $50,000 with APRs ranging from 7.8% to 35.99%, which is much lower than Lendly’s typical 225% APR. Like LendingClub, Upstart also offers longer repayment terms of 36 or 60 months.
One unique aspect of Upstart is that they consider factors beyond just credit score when evaluating borrowers, such as education and employment history. This could potentially make it easier for borrowers with limited credit history to qualify compared to more traditional lenders.
Upstart does charge an origination fee, which ranges from 0% to 8% of the loan amount. However, they don’t charge any prepayment penalties, so borrowers have the flexibility to pay off their loans early if they choose.
Lendly vs. Payday Loans
Payday loans are short-term, high-cost loans that typically need to be repaid on your next payday. These loans often come with extremely high APRs, sometimes exceeding 400%, which can make them very difficult to pay off.
In comparison, Lendly’s typical APR of 225%, while still very high, is substantially lower than most payday loans. Lendly also offers a longer repayment term, with the average loan being repaid over 26 bi-weekly payments, giving borrowers more time to pay off their debt compared to payday loans.
Lendly vs. Earnin
Earnin is an app that allows users to borrow small amounts of money against their upcoming paycheck. One key difference is that Earnin doesn’t charge any mandatory fees or interest. Instead, users can voluntarily “tip” the app what they think is fair.
However, Earnin has much lower borrowing limits compared to Lendly. Earnin typically caps advances at $100 to $500 per pay period, depending on the user’s income and usage history, while Lendly offers loans up to $2,000.
Lendly vs. Dave
Dave is another popular cash advance app that provides small, short-term loans to help users avoid overdraft fees. Like Earnin, Dave doesn’t charge any interest. Instead, they make money through optional tips and a monthly membership fee.
Dave’s borrowing limit is also lower than Lendly’s, with a maximum advance of $250. However, Dave offers additional features that Lendly doesn’t, such as budgeting tools and the ability to build credit by reporting rent and utility payments to the credit bureaus.
Lendly vs. Upgrade
Upgrade is an online lender that offers personal loans with APRs ranging from 5.94% to 35.97%, which is significantly lower than Lendly’s typical APR of 225%. Upgrade also offers loans up to $50,000, which is much higher than Lendly’s maximum of $2,000.
However, Upgrade typically requires a minimum credit score of 580 to qualify, while Lendly may be more lenient with credit requirements. Upgrade also charges an origination fee of 2.9% to 8%, while Lendly doesn’t mention any origination fees.
Sample Lendly Repayment Schedule
Here’s a sample repayment schedule for a Lendly loan:
Let’s say you borrow $2,000 with Lendly’s typical APR of 225%. Your loan term is set at 26 bi-weekly payments, which is about one year.
Given these loan details, your bi-weekly payment would be approximately $226. Remember, this payment will be automatically deducted from your paycheck every two weeks.
Here’s what your repayment schedule might look like:
| Payment Number | Payment Amount | Principal | Interest | Remaining Balance |
|---|---|---|---|---|
| 1 | $226 | $73 | $153 | $1,927 |
| 2 | $226 | $79 | $147 | $1,848 |
| 3 | $226 | $85 | $141 | $1,763 |
| … | … | … | … | … |
| 24 | $226 | $206 | $20 | $452 |
| 25 | $226 | $222 | $4 | $230 |
| 26 | $230 | $230 | $0 | $0 |
As you can see, a significant portion of each payment goes towards interest, especially in the beginning of the loan term. This is because of the high APR associated with Lendly loans.
Over the course of this loan, you would pay a total of $5,876 in 26 bi-weekly payments. That means you would pay $3,876 in interest on your original $2,000 loan.
It’s crucial to understand the true cost of borrowing before taking out a high-interest loan like those offered by Lendly. While the bi-weekly payment might seem manageable, the total amount repaid is more than double the original loan amount due to the high APR.
Alternatives to Consider
If you’re considering a Lendly loan, it’s worth exploring some alternatives that may offer lower costs or better terms. Here are a few options to consider:
- Payday Alternative Loans (PALs): Some credit unions offer payday alternative loans (PALs) as a more affordable option compared to traditional payday loans or high-interest installment loans like those offered by Lendly. PALs typically have lower interest rates capped at 28% and longer repayment terms, making them a more manageable option for borrowers.
- Personal Loans from Online Lenders: Online lenders like LendingClub, Upstart, and Prosper offer personal loans with APRs that can be significantly lower than Lendly’s rates. These lenders often have more flexible credit requirements and can provide funds quickly, sometimes as soon as the next business day.
- Cash Advance Apps: Apps like Earnin and Dave allow users to borrow small amounts of money against their upcoming paycheck without charging interest. While the borrowing limits are typically lower than what Lendly offers, these apps can be a good option for covering small, short-term expenses without the high cost of borrowing.
- Payment Plans with Creditors: If you’re considering a loan to cover bills or outstanding debts, reach out to your creditors first. Many companies, including utility providers, landlords, and even some credit card issuers, may be willing to work out a payment plan that can help you catch up without resorting to high-interest loans.
- Local Assistance Programs: Many communities have local nonprofit organizations, charities, and religious institutions that offer financial assistance to those in need. These programs may provide help with food, rent, utilities, or other essential expenses, which can reduce your need for borrowing.
- Building an Emergency Fund: While it may not be an immediate solution, working to build an emergency fund can help you avoid the need for high-cost loans in the future. Start by setting aside whatever you can, even if it’s just a few dollars per week, and gradually increase your contributions as your budget allows. Having a savings cushion can provide peace of mind and financial stability when unexpected expenses arise.
Tips for Getting the Best Lendly Loan Rate
While Lendly’s interest rates are generally quite high, there are a few things you can do to potentially improve your chances of getting a better rate:
- Improve Your Credit Score: Although Lendly may be more lenient with credit requirements compared to traditional lenders, having a higher credit score could still help you secure a better rate. Before applying, check your credit report for errors and take steps to improve your score, such as paying down credit card balances and making all payments on time.
- Provide Accurate and Complete Information: When filling out your loan application, be sure to provide accurate and up-to-date information about your income, employment, and other financial details. Inconsistencies or missing information could lead to a higher interest rate or even loan denial.
- Consider a Co-Borrower: If you have a trusted family member or friend with a strong credit profile, consider asking them to be a co-borrower on your loan. Having a co-borrower with good credit can help you secure a lower interest rate and improve your chances of approval.
- Borrow Only What You Need: While it may be tempting to borrow the maximum amount offered, keep in mind that a larger loan balance will result in higher interest charges over time. Borrow only what you need to cover your expenses, and consider whether you can reduce the loan amount by cutting back on non-essential spending or finding additional sources of income.
- Compare Rates from Other Lenders: Before accepting a loan offer from Lendly, take the time to shop around and compare rates from other lenders, including online lenders, credit unions, and traditional banks. By getting quotes from multiple sources, you can ensure that you’re getting the best possible rate for your financial situation.
Frequently Asked Questions
1. Who is a Lendly loan good for?
A Lendly loan is designed for individuals who need access to cash quickly, even if they have less than perfect credit. The loans range from $1,000 to $2,000 and can be funded in as little as 24 hours after approval. The repayment process is made convenient through payroll direct deposit, where a portion of your paycheck is automatically deducted to make the loan payment. This eliminates the need to remember to make manual payments each month. Lendly loans are a good option for those facing unexpected expenses or needing short-term cash flow assistance.
2. What interest rates does Lendly Loan offer?
Lendly loans come with a high annual percentage rate (APR) of approximately 225% for a typical loan. This reflects the higher risk associated with lending to borrowers with subprime credit histories. While convenient, borrowers need to carefully consider the total cost of the loan at this APR before proceeding, as it can make the loan very expensive over its term compared to other options.
3. What fees does Lendly Loan charge?
Lendly Loan does not charge any fees besides interest. Additionally, for Florida residents, loans are subject to a Documentary Stamp Tax of 35 cents per $100 or portion thereof, which amounts to $3.85 for a $1,000 loan.
4. Does Lendly Loan charge prepayment fees?
Lendly Loan does not charge prepayment fees. Borrowers are allowed to make extra payments or pay off their loan early without incurring any penalties, providing flexibility in managing their loan repayment.
5. What do you need to qualify for Lendly Loan?
The main requirements to qualify for a Lendly loan are having a job with the ability to set up payroll direct deposit for loan payments, and being able to verify your employment and income details through third-party services during the application process. While credit history is considered, having a low or subprime credit score alone will not automatically disqualify you from getting a Lendly loan.
6. Does Lendly Loan report your account activity to credit bureaus?
Yes, Lendly reports all of their loan customers’ payment activity to credit reporting agencies on a monthly basis. This means your payment history, good or bad, can directly impact your credit scores and reports while you have an outstanding Lendly loan.
7. How soon can I get my money after being approved for a Lendly loan?
Once your application is finalized and your loan documents are signed or direct deposit is set up, funds are typically deposited into your bank account the next business day. However, it may take up to 3 business days depending on your bank’s processing time.
8. Can I have multiple Lendly loans at the same time?
No, borrowers are only allowed to have one Lendly loan at a time. However, if borrowers need additional funding, they can request a loan refinance after 90 days with a good repayment history.
9. How is interest calculated on a Lendly loan?
Lendly uses a simple interest calculation method, where the interest charge each day is the outstanding principal balance multiplied by the annual interest rate (225% APR) and divided by 365 days. The daily interest charges accrue until a payment is made to reduce the principal balance.
Conclusion
Lendly loans can provide fast cash for those in need, but the extremely high interest rates of around 225% APR make them an incredibly expensive borrowing option. Before taking on a Lendly loan, it’s crucial to carefully evaluate if you can truly afford the bi-weekly automatic payroll deductions and total borrowing costs.
Exploring alternatives like credit union loans, payment plans with creditors, local assistance programs, and building an emergency fund could help you avoid the debt cycle of high-interest loans.
If you do decide a Lendly loan is your best option, following tips like improving your credit, borrowing only what you need, and shopping rates from multiple lenders can potentially help secure a better rate. With diligent budgeting and research, you can determine if a Lendly loan is a wise financial decision for your situation.
Emily Johnson is a seasoned loan expert whose passion lies in empowering individuals to make informed financial decisions. With years of experience in the lending industry, Emily has honed her expertise in various loan products and strategies.