If you’re currently looking to obtain a loan but your credit score is holding you back, then you might want to consider a specialist lender like Avant. The platform claims to offer loans to those with a credit score of 580 or above, which is something that many lenders wouldn’t consider.
However, you’ll need to make some considerations regarding fees before you apply for an Avant loan, as these are much higher in comparison to traditional lenders.
In our Avant review, we’ll cover everything that you need to know. On top of fees, we’ll also look at who is eligible, how the loan process works, and anything else that we think you should know before you apply.
Let’s start by finding out who Avant is.
Who is Avant?
- 1 Who is Avant?
- 2 Avant Fees: How Much Does it Cost to Take out a Loan?
- 3 Avant Charges: What Happens if I Miss a Payment?
- 4 Who is Eligible for an Avant Loan?
- 5 How Much can I Borrow with Avant?
- 6 How Long are the Loan Agreements with Avant?
- 7 What Types of Loans Does Avant Offer?
- 8 Debt Consolidation
- 9 Business Start-Ups
- 10 Home Improvement
- 11 Emergency Funding
- 12 How do I get a Loan with Avant?
- 13 Soft Credit Application (Pre Approval)
- 14 Verifying Your Information
- 15 Signing Your Loan Agreement Documents
- 16 Receiving Your Funds
- 17 How do I Repay my Loan?
- 18 Customer Service at Avant
- 19 Avant Credit Card
- 20 Avant Mobile App
- 21 Avant Review: The Verdict?
- 22 Avant Loans
- 23 Pros
- 24 Cons
One of the key selling points to Avant is that they service loans to those that have a poor credit rating. As such, if you’ve previously had a loan application rejected by a traditional lender, then the team at Avant claim that they might be able to help.
Avant also claims to have loaned $4 billion to more than 600,000 customers, and that 95% of these customers have been left satisfied, as per a recent study compiled by the lender.
The loan process itself is rather straight forward, as in most cases you can submit your application online. If Avant is able to verify the details you entered with third-party sources, then you’ll likely receive an instant decision.
The Chicago-based lender states that approximately half of the loans they service are taken out to consolidate debt. This is where you take out a loan with Avant to pay off one or more other loans that you hold with other lenders.
As is usually the case with lenders that provide loans to those with poor credit, the rates charged by Avant are a lot higher than you will find at a conventional bank. However, if you’ve got nowhere else to turn and require finance, then you might need to see what Avant can offer you.
So now that you know what Avant do, let’s take a look at fees.
Avant Fees: How Much Does it Cost to Take out a Loan?
When assessing whether a lender is right for your individual needs, one of the first things that you should look at is fees. First and foremost, the Avant platform charges an origination fee of 4.95%.
For those unaware, an origination fee is charged by lenders to service and administer loan agreements. In the case of Avant, a $10,000 loan would amount to an origination fee of $495.
To put this into perspective, the average origination fee charged by lenders in the U.S. is typically between 0.5%-1%. As such, the origination fee charged by Avant is considerably higher than the national average.
Nevertheless, this fee is subsequently reduced from the total amount that you receive from Avant. Using the same example as above, this means that you would receive just $9,505 of the $10,000 loan you had approved.
When it comes to the APR on the loan, Avant charges anywhere between 9.95% and 35.99%. There is no hard-and-fast rule as to how much you are likely to be offered, as the rate you get is entirely dependent on your credit rating.
For example, if you have good credit, then you’ll be much closer to the 9.95% figure. On the other hand, if you have a bad credit score, then it is possible that you could pay a whopping 35.99%.
If you do end up paying the higher rate, let’s take a look at a quick example.
Let’s say you took out a loan for $10,000 over the course of two years. Excluding the origination fee, you’re offered the full 35.99% APR rate. This means that you would be making 24 monthly payments of $590.42. You would end up paying a total of $14,170.12 back to Avant, meaning your total interest would amount to $4,170.12.
Avant Charges: What Happens if I Miss a Payment?
On top of origination fees and interest rates, you also need to make some considerations regarding missed payments. As is standard across the lending space, you’ll be charged additional fees if you miss a payment.
Although this will depend on the specific state, in most cases you will be hit with a late payment fee of $25. On the other hand, if you then make three subsequent payments on time, Avant will reimburse the late payment fee, which we really like.
If you have your bank account linked up with Avant as a means to make your monthly payments, but there isn’t enough money in your account to cover the payment, then you’ll be charged a $15 unsuccessful payment fee.
Who is Eligible for an Avant Loan?
As Avant is a specialist lender for those with poor to medium credit, the acceptance threshold is much lower in comparison to traditional lenders.
Avant themselves state that:
“Avant provides access to credit products that fit a wide variety of customers because each credit product is tailored to each person’s individual credit situation and history. Most of our customers that receive loans have a credit score of 600 to 700.”
However, according to reviews and testimonials available in the public domain, Avant does consider applicants with a credit score of 580 and above.
Avant will also look at other factors when assessing whether or not to approve your application, such as your income, and any other debt obligations you currently have outstanding.
In most cases, you will need to ensure that you have an annual income of $20,000 or more.
The good thing about Avant is that the platform allows you to view your individual loan rates online, which only results in a soft credit check. This means that your inquiry will not have any impact on your credit score. On the other hand, if you decide to proceed with your application, Avant will then be required to initiate a hard credit inquiry.
This means that your credit report will show that you made the loan application to Avant – regardless of whether or not it was approved.
How Much can I Borrow with Avant?
Avant allows you to borrow a minimum of $2,000, right up to a maximum of $35,000. However, in some cases, you might be offered more or less than you applied for.
For example, if you apply for a loan amount of $15,000, but Avant believes that your credit score doesn’t quite meet its criteria, then you might be offered $10,000. Each loan application is unique, so Avant will determine how much they are able to lend you based on your individual circumstances.
How Long are the Loan Agreements with Avant?
When you go through the loan application process, you will be given the chance to determine how long you need to pay for the loan back. The standard window offered by Avant is between 24 to 60 months.
We really like the fact that Avant allows you to repay your loan early. Some lenders do not allow you to do this, and even if they do, they will penalize you financially. With Avant, you can pay your loan back in full without being charged anything extra.
What Types of Loans Does Avant Offer?
When you go through the loan application process, Avant will want to know why you need to borrow funds from them. This is generally split into four different categories, which we’ve listed below.
As we mentioned earlier, Avant claims that close to half of all the loans it issues are to cover debt consolidation. This would be useful if you have several outstanding debts across multiple lenders.
For example, rather than having credit cards, loans and bills with multiple providers, you can consolidate them all via Avant. Just keep an eye out on the APR rates to ensure that the debt consolidation strategy is worthwhile.
If you are in the process of starting your own business, but you don’t quite have the required funding to do so, then Avant might be able to assist. Although you’ll only be able to obtain a maximum of $35,000, this could be enough to get you up and running.
If you would like to make some meaningful improvements to your home, then Avant can finance the work. This could be for a number of potential improvements, such as installing a new security system or buying new furniture.
If you require funding for something else, then it is likely to fall within the emergency loan category. This could be a bill that you are unable to meet, such as a dental or medical bill.
How do I get a Loan with Avant?
When you first head over to the Avant website, you will need to initially fill out the online form to see whether you are likely to be accepted and at what rate.
Soft Credit Application (Pre Approval)
For this, you will need to provide Avant with the following information. Don’t forget, this stage of the application is a soft credit check, so other lenders won’t be able to see that you’ve applied.
- Full name
- Home address
- Whether you rent or own a car
- Monthly housing payment
- The date you moved to your home address
- Date of birth
- Phone number
- email address
- Social security number
- Income type
- Monthly net income
- Reason for the loan Loan amount
- How would you rate your credit quality
Once you’ve submitted all of the required information, Avant will then assess your loan application. This is done automatically by evaluating your personal circumstances against third party sources.
In the vast majority of cases, you should receive a decision within less than a minute. If your application is pre-approved, you will still need to provide Avant with more information.
Verifying Your Information
Avant will attempt to verify your information against third party sources. However, you’ll also need to go through an electronic knowledge-based authentication (KBA) process. For those unaware, this is where you are asked a series of question that only you should know the answer to.
Avant extracts this information from third party credit rating agencies, and the questions are multiple choice. For example, you might be asked to select a lender that you currently have a loan with, or details pertaining to a previous address.
Once you’ve passed the KBA process, you will then likely need to submit some documents. This is not only to verify your identity, but also the income that you specified in your application.
An example of some of the documents that you will need to provide are as follows:
- Government issued ID (passport or driving license)
- Recent pay slips
- Proof of bank account ownership
- Proof of address
- Proof of U.S. residence or citizenship
- Proof of income
When it comes to verifying your place of employment, Avant allows you to do this by confirming your work email address. They will send an email to your work email, and then you need to click the link contained within the message. For obvious reasons, this can’t be a generic email address such as those offered by Gmail or Hotmail.
Signing Your Loan Agreement Documents
Once Avant is satisfied that they have verified your identity and income, your loan will be approved. Before they can release the funds, you will first need to sign your loan agreement documents.
You can do this via your Avant account portal electronically.
Receiving Your Funds
As soon as you have signed your loan agreement documents, the team at Avant will then transfer your funds directly into your bank account. The money is typically deposited the next business day via ACH, as long as your loan is approved by 4.30pm CT, Monday to Friday.
All in, the end-to-end process can be finalized within 1 working day.
How do I Repay my Loan?
Your first loan payment will be due around 30 days after you received the funds in your bank account. After the first payment is issued, your monthly repayments will need to be made on the same date each month.
For example, if your first repayment was issued on June 7th, then each subsequent repayment would be due on the 7th of each month. If you are ever unsure, you can always log in to your Avant account portal to view your scheduled repayments.
In terms of supported payment methods, you have three main options. You can decide to set up regular bank account payments, which will ensure that you never miss a payment
Avant also gives you the option of paying with a debit or credit card.
If paying by debit card, Avant supports payments via Visa, MasterCard, and Discover. Amex isn’t accepted.
Although you can pay by credit card, as of September 2018, Avant no longer accepts Visa credit cards.
Furthermore, although Avant does not pass on credit card processing fees to you, your card issuer is likely to charge you for this, as transactions of this nature are typically categorized as a cash advance.
Customer Service at Avant
If you need to speak with a customer support agent at Avant, you have a couple of options available. If you require instant assistance, then you are best calling the team directly. The loan customer service team are available Monday to Friday 7am to 10pm, and between 7am and 8pm at weekends. All times are Central Time. Alternatively, if your query is less urgent, then you can send the team an email.
When looking in the public domain for reviews on Avant, the general consensus is generally quite positive. Notable points centered on the team responding to account queries quickly and efficiently.
The most common negative point that we came across from public reviews was with regards to high-interest rates. However, it is important to note that Avant is very clear regarding the fees they charge.
In fact, you are presented with your interest charges when you first perform the soft application, meaning you have the option of declining the offer. We also noted that the likes of Credit Karma and AAA Credit Guide have both scored Avant favorably, with a score of 4.5 and 4.8 out of 5, respectively.
Avant Credit Card
Outside of its traditional lending vehicle, Avant also offers a credit card. Although the Avant credit card is also suited for poor to medium credit scores, you will likely need to have a FICO score of at least 630. Strangely, Avant do not state the credit limit thresholds that you can obtain, as this is determined based on your individual circumstances.
The card, which is backed by MasterCard, carries a fixed annual fee of $29. In terms of the ongoing APR, you will 26.24% on both purchases and cash advances. However, you will also need to pay an additional 3% on cash advances, at a minimum of $5.
These rates are much higher than in comparison to other credit cards you will find in the market. However, once again, this is to mitigate the risks associated with lending to those with poor to medium credit.
Avant Mobile App
For those of you that like to have the option of applying for loans via your smartphone device, you’ll be pleased to know that Avant has a native mobile app. You download the app across both Android and iOS devices, free of charge.
Unfortunately, for those using Windows or Blackberry devices, you’ll need to stick with the mobile browser version of the site.
Once you’ve downloaded the app and signed in, you can access all of the same services that you would expect to find online. This includes the ability to view your payment history, see upcoming payments, make payments, and of course, apply for a loan.
You can also set up your mobile app so that you receive push notifications. This is especially useful if you want to receive periodic reminders when a repayment is due.
In terms of online reviews regarding the app, these are somewhat mixed. For example, the app is rated just 3.3 on Google Play. Upon reviewing the comments in more detail, some users reported issues with the accuracy of account details when using the app. This included issues with the balance of outstanding loans.
Avant Review: The Verdict?
In summary, Avant has a clear target market. If you’re currently looking to obtain finance but you’re struggling to get your application approved with traditional lenders, then Avant is a noteworthy alternative.
While it is true that the interest rates charged by Avant are significantly higher in comparison to conventional lenders, this is to mitigate the higher risks of lending to those with poor credit.
We also like the fact that Avant is really transparent on the fees it charges, meaning that you have a full understanding of the charges before proceeding with your application. This is important, as some lenders are notorious for inserting hidden fees.
It is also notable that Avant gives you the chance to recover previously charged late payment fees. If you miss a payment but subsequently meet the following three on time, Avant will refund the $25 late payment fee.
If we were to highlight a potential negative with Avant, it would have to be with respect to its origination fee. While traditional lenders in the U.S. will charge in the region of 0.05% to 1%, Avant charges a remarkable 4.95%. This means that by obtaining a $15,000 loan, Avant would charge you $742.50. Although this is subtracted from the loan amount as opposed to an upfront payment, this effectively increases your APR.
It would also be worthwhile if Avant spent some time fixing their native mobile app. Reviews in the public domain indicate that the app is riddled with bugs, which is reflected in its rating on both Google Play and the iTunes store.
Nevertheless, all in, if you’re looking for a lender that will consider applications from low-to-medium credit scores, then Avant is up there with the best of them.