SBA 504 Lending

SBA LENDING

As a nationwide preferred SBA lender, LendingClub will work closely with you to evaluate your needs, develop a customized solution, and guide you through the process from start to finish.

Start or Expand Your Business

<ul><li>Multi-use and Special-use Real Estate</li><li>Start-ups</li><li>Business Acquisitions (up to $5 million)</li><li>Franchise Lending</li></ul>

Highlights of SBA Lending

<ul><li>National Coverage</li><li>All Property Types (Assisted Living, Child Care, Limited-Service Hotels)</li><li>Construction Financing</li><li>Long-term Fixed Rates Available </li></ul>

Features of the 504 Loan Program

<ul><li>10%-20% Equity Injection Depending on Multi-use, Special-use or Start-up</li><li>1.15x Debt Service Coverage Ratio Last Full Fiscal Year and Interim</li><li>Prior Ownership &amp; Management Experience Preferred</li><li>Minimum FICO = 660</li></ul>

Loan Qualifications

“Joyce in Customer Service was great… she spent a lot of time with me and made me feel appreciated as a customer.” 1- Hayden S.

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Higher credit scores provide access to lower interest rates and better terms when you apply for credit. However, if your credit score needs work, there may be credit hacks you can take to improve your score.  

Generally, you can boost your credit score by understanding important factors that affect your credit score, like on-time payments, credit history, total debt owed, credit mix, and new credit. Improving your credit score before borrowing may qualify you for more favorable interest rates, potentially resulting in lower monthly payments and savings over the life of the loan. <h2>How to improve your credit score </h2>The power to get your credit score moving in the right direction is in your hands. Check out nine steps you can take now to improve your credit score and your credit health. <h3>1. Review your credit reports and dispute errors </h3>Credit reporting isn’t a perfect science—errors happen, and incorrect items could seriously damage your score. Reviewing your credit report regularly and knowing how to read it can help you <a href="https://www.lendingclub.com/resource-center/personal-finance/how-to-read-your-credit-report-identify-red-flags">catch errors and dispute mistakes</a> that impact your credit score. All three credit bureaus provide one free credit report every 12 months (with some exceptions, such as for the unemployed) at <a href="http://annualcreditreport.com/">AnnualCreditReport.com</a>. Review your reports and double-check that the following information is correct: <ul><li>Name </li><li>Addresses </li><li>Phone number </li><li>Birthdate </li><li>Accounts and account numbers </li><li>Account status</li><li>Payment history </li><li>Credit inquiries (soft and hard) </li></ul>Check for errors and look for addresses or accounts you don’t recognize. Next, file a dispute if there is an error or an account you don’t recognize. If you find an error in one credit report, it’s smart to check with the other two major credit bureaus in case they contain the same error. You can also check for and contact the reporting bureau about any negative items that are too old to be reported. In the case of a late bill payment, that’s about seven years after a bill first went late. You can dispute with each credit bureau online, by mail, or by telephone. <ul><li><a href="https://www.experian.com/disputes/main.html">Experian</a> </li><li><a href="https://www.equifax.com/personal/credit-report-services/credit-dispute/">Equifax</a> </li><li><a href="https://www.transunion.com/credit-disputes/dispute-your-credit">TransUnion</a> </li></ul>After you file a dispute, credit bureaus have about 30 days to investigate. If information is found to be incorrect, it must be removed. Following the investigation, you will receive a response from the credit bureau. <h3>2. Always pay your balance on time </h3>Your payment history matters. More than any other single factor in your credit score, making on-time payments is critical because the impact of missing just one can linger on your credit report for up to seven years. Automatic payments are a great way to make sure your payments are submitted by the due date each month. <h3>3. Consider becoming an authorized user on another person’s account </h3>When you become an authorized user on someone else’s credit card account, you’re effectively putting a portion of your credit score into that person’s hands. This can impact your scores positively, negatively, or have no impact at all. For example, if they use their credit responsibly, it could help raise your credit scores—but if they start missing payments or you both make purchases that they’re not able to pay off in full each month, your scores could be negatively impacted. If the credit card issuer does not report authorized users’ activity to the credit bureaus, it would not influence your credit rating either way. Make sure you team up with a credit card holder who is using their credit card responsibly, otherwise you might want to remove yourself as an authorized user. <h3>4. Add recurring payments to your credit reports </h3>Recurring payments such as for utilities, streaming services, and rent aren’t usually included on a credit report, however, some credit bureaus now offer services that may help increase your credit score by taking into account bills you already pay. <a href="https://www.experian.com/consumer-products/score-boost.html">Experian Boost</a><a href="https://www.experian.com/consumer-products/score-boost.html">TM</a> adds on-time utility and subscription payments to your Experian credit report, and <a href="https://ecredable.com/">eCredable®</a> allows you to add utility payments to your TransUnion report for a small fee. If you make those payments on time each month, you can have them counted toward your score on two of your credit reports. Rent-reporting services will also report rent payments to the credit bureaus for a fee paid by either you or your landlord. So, on-time rent payments can help you build credit history, too. <h3>5. Consider a secured credit card or credit builder loan </h3>If you’re rebuilding credit or building credit from scratch, consider applying for a secured credit card. Secured cards are often easier to qualify for because they require a security deposit (usually equal to the credit limit) that minimizes risk for the card issuer. Putting small purchases on the card and paying down the balance each month could help you establish an on-time payment history. After a certain number of on-time payments, you may even get your deposit back and offered an unsecured card. Credit builder loans are a type of installment loan that work opposite most loans — you get your money after you repay the loan. The funds are put in an interest-bearing account, and you receive access to it at the end of the loan term or when you close the account. Like secured cards, credit builder loans are relatively easy to qualify for, and on-time payments reported to the credit bureaus can help improve your credit score. Some don’t require a credit check. <h3>6. Use credit lightly </h3>Suppose you already have access to credit accounts and some history under your belt, but you want to strengthen your credit score before applying for a credit card or loan. Lowering a high credit utilization ratio could be the fastest way to improve a credit score. Your credit utilization is the percentage of your credit limit that is in use. <a href="/resource-center/personal-finance/what-is-credit-utilization-and-how-to-improve-it">Credit utilization</a> is calculated both on individual cards and overall. Generally, you want to shoot for a credit usage below 30%; the highest credit scorers generally have credit utilization under 10%. <h3>7. Pay down credit card debt </h3>Increasing card payments, getting a new card, requesting an increase to your credit limit, or paying off credit cards with a debt consolidation loan are all strategies that could help you pay down your debt, lower your credit utilization and help improve your score when the new balances update on your reports. Even if you’re not using a credit card, consider keeping it open unless there is a compelling reason to close it, such as poor customer service or fees you don’t think are worth it, since the available credit line you’re not using could help keep your utilization low. In addition, if it’s an older card, it may contribute to your credit score in the form of the length of your credit history and the average age of credit history. <h3>8. Space out credit applications </h3>There are two types of credit inquiries—soft and hard. Soft inquiries, such as when you pull your own credit report or when lenders prequalify you for a loan, don’t affect your credit score. Hard inquiries happen when you apply for new credit such as credit cards or loans, and the creditor pulls your credit report to make a decision about your application. That kind of inquiry can affect your credit score. According to Fair Issac Corporation, or FICO®, <a href="https://www.myfico.com/credit-education/credit-reports/credit-checks-and-inquiries#:~:text=In%20general%2C%20credit%20inquiries%20have,or%20a%20short%20credit%20history.">credit inquiries have a small impact on your FICO score:</a> &quot;For most people, one additional inquiry will take less than five points off their FICO Scores.&quot; If you have a minimal credit history or many credit checks at once inquiries can have an outsized impact. So going on an application spree might hurt your score. <h3>9. Get into the habit of reviewing your credit report </h3>Signing up for credit monitoring and reviewing your credit reports regularly can help you track credit score growth and ensure the data on your credit reports are always accurate. Routinely checking your credit scores can also help you see the relationship between what you do and how it affects your credit score. Many banks, credit unions, and credit card companies now offer free credit score monitoring you could follow (but be sure you are using the same score and model to compare). You could also get access to a FICO score for free with some credit cards. VantageScore® is also available for free from some credit cards and personal finance websites, and checking your own score won’t affect your credit score. <h2>How long will it take to improve your credit score? </h2>The amount of time it takes to improve your credit score depends partly on the factors that caused or are keeping your credit score low. Recovering from late payments, for example, will take longer than fixing an error that resulted in a low credit score. If you have no credit history, it could take up to six months for scoring models to generate your first credit score, and your credit score can improve from there with on-time payments and using credit lightly if you use credit cards. Past missteps won’t stay on your credit report forever. Generally, the impact of late payments decreases over time, even though they remain on your credit report for up to seven years. Collections may also show on your credit report for up to seven years. Filing Chapter 7 bankruptcy can stay on your credit report for up to 10 years, and Chapter 13 for up to 7 years. Establishing new accounts with good payment records can help reduce the impact of past mistakes. <h2>The bottom line </h2>If you’re looking for a job or a new apartment to rent, improving your credit score could have a significant impact in the eyes of a potential employer or landlord who may want to take your credit health into consideration as part of the review process. Improving your credit score can take time. Consistently paying on time, keeping an eye on credit utilization, keeping credit cards open, and disputing credit reporting errors can help you reach or keep a credit score that gives you access to the best terms on <a href="https://www.lendingclub.com/loans/personal-loans">personal loans</a>, credit cards, and other forms of credit.

A 700 credit score is generally considered “good” among common scoring systems that range from 300 to 850.

People with good credit generally qualify for the best rates on <a href="https://www.lendingclub.com/personal-loan">personal loans</a>, credit cards, and other types of credit. Strong credit also helps you get better insurance rates and housing. A good credit score shows lenders you’re financially responsible, make on-time payments, and can be counted on for repayment.[1] <h2>What is considered a ‘good’ credit score? </h2>Many types of credit scores exist. However, <a href="https://www.myfico.com/credit-education/what-is-a-fico-score">FICO</a><a href="https://www.myfico.com/credit-education/what-is-a-fico-score">®</a><a href="https://www.myfico.com/credit-education/what-is-a-fico-score"> Score</a> and <a href="https://www.vantagescore.com/press_releases/the-complete-guide-to-your-vantagescore/">VantageScore</a> are the two main credit-scoring companies, with the Fair Isaac Corporation (FICO) score being used by about 90% of top lenders.[2] Both companies use a scoring range of 300 to 850, with 850 being the highest score. FICO generally considers a score between 670 and 739 as good.[3] VantageScore models define good as a score 661 to 780.[4] <h2>VantageScore vs FICO score </h2>FICO and VantageScore credit-scoring models use unique (and proprietary) scoring methodologies to calculate your credit score. However, both models typically consider the following factors: <ul><li>Your payment history </li><li>How much you owe </li><li>The age of your credit history </li><li>Your credit mix </li><li>New credit accounts </li></ul>Your score may differ between different scoring systems. However, since your score is based on many of the same factors in your credit history, if you have a good FICO score you most likely also have a good VantageScore.[4] [5] <h3>What is a good VantageScore? </h3>The VantageScore model was developed in 2006 by the three major consumer credit bureaus—Equifax, Experian, and TransUnion. Your VantageScore is based on credit report data from each of the bureaus. The latest versions, VantageScore 3.0 and VantageScore 4.0, generally consider a “Prime” score of 661 to 780 to be good. Lenders that check your VantageScore typically use the VantageScore 3.0, but VantageScore 4.0 is expected to become more popular as more lenders transition over.[5] <h3>What is a good FICO score? </h3>The FICO score model was introduced in 1989 and is the credit score most lenders use when you apply for credit. FICO has <a href="https://www.myfico.com/credit-education/credit-scores/fico-score-versions">several types of scores</a> lenders can choose from, some of which are industry-specific. FICO 8 is the base scoring model, and it’s most commonly used when you apply for loans and other types of credit. However, if you apply for a car loan, for example, the lender might check your FICO Auto Score instead. Generally a FICO credit score range of 670 to 739 is considered good across the different FICO versions.[3] <h2>What is the average credit score? </h2>Most Americans have good credit, according to the latest data from both FICO and VantageScore. In 2023, <a href="https://www.fico.com/blogs/average-us-fico-score-717-more-consumers-face-financial-headwinds">FICO scores averaged 717</a>, and <a href="https://www.vantagescore.com/press_releases/vantagescore-creditgauge-may-2024-the-credit-gap-consumer-credit-diverged-older-and-more-affluent-borrowers-continued-to-spend-and-pay-on-time-as-younger-consumers-increasingly-we/">VantageScores averaged 704</a> in 2024. However, many consumer trends affect score averages like changes in people’s ability to pay their bills on time, rising consumer debt, and falling rates of new credit applications. Where you live can also affect credit score averages. <h2>What does a good credit score get you? </h2>People with good credit often qualify lower rates and better credit terms. Some of the benefits of having a good credit score include: <ul><li>A stronger chance of approval: A good credit score indicates to lenders that you are a trustworthy borrower. </li><li>Better interest rates: A good credit score can help you qualify for loans and credit cards with more favorable rates and terms. </li><li>Higher credit limits: Lenders base your credit limits or loan amounts on many factors, including your credit score. A good credit score can help you qualify for higher amounts. </li></ul>Remember: Lenders consider more than your credit score when you apply for credit, and each has its own lending requirements. Shop around to make sure you’re getting the best rates.[1] <h2>How to get a ‘good’ credit score </h2>Building good credit may take time. However, using the following strategies can help you <a href="https://www.lendingclub.com/resource-center/personal-finance/what-affects-your-credit-scores">improve your credit</a> and maintain a good credit score over time. <h3>Pay on time, every time </h3>Of all the factors that affect your credit score, your payment history carries the most weight. For this reason, the number one thing you can do to improve your score is to pay your bills on time and avoid missed payments.[6] <h3>Pay down debt </h3>To keep your credit utilization low, aim to pay as much as possible toward your debt each month. Consider a <a href="https://www.lendingclub.com/personal-loan/debt-consolidation">debt consolidation loan</a> to pay down high-interest debt, like credit cards. <h3>Maintain a consistent credit history </h3>The longer you’ve been borrowing money, the more detailed your credit report will be. Lenders prefer a longer credit history because it reveals the borrower’s spending habits and reliability. So keep those older credit cards open even if you don’t use them.[6] <h3>Opt for different types of credit </h3>Lenders like to see you can manage different types of credit accounts. Although your credit mix only determines about 10% of your FICO credit score, for example, it’s still a good idea to maintain a varied mix of credit cards, auto loans, personal loans, mortgage loans, and other credit products.[6] <h3>Limit applications for new credit </h3>Applying for credit can cause your score to dip thanks to a <a href="https://www.lendingclub.com/resource-center/personal-finance/key-differences-of-a-soft-credit-check-vs-hard-credit-check">hard inquiry</a> from the lender. Numerous applications within a short timeframe for credit can also signal to a lender that you’re not able to manage credit responsibly.[6] <h3>Ask for higher credit limits </h3>You may be able to lower your credit utilization rate by asking creditors for a credit limit increase. However, this is only helpful if your spending stays low.[6] <h3>Dispute credit report errors </h3><a href="https://www.lendingclub.com/resource-center/personal-finance/how-to-read-your-credit-report-identify-red-flags">Errors on your credit report</a> can affect your score negatively—especially when fraudulent activity occurs. So, it’s a good idea to check your credit reportregularly. If anything looks off, report it immediately. You can request free copies of your credit reports from each of the three major credit bureaus—Equifax, Experian, and TransUnion—once a year at <a href="http://annualcreditreport.com/">AnnualCreditReport.com</a>.[6] <h2>The bottom line </h2>Your credit score is an important factor lenders consider when you apply for credit, like a personal loan or credit card. If your credit isn’t perfect, don’t worry; a good score is usually all you need to qualify for the best loan and credit offers. If your credit is still a work in progress, you can take steps to improve your scores over time. Remember, <a href="https://www.lendingclub.com/resource-center/personal-finance/getting-a-copy-of-your-credit-report">checking your own credit</a> is a good way to keep tabs on your score and look out for fraudulent activity—without affecting your score. <h2>FAQs </h2>Staying on top of your credit score is an important part of managing your finances. Here are some commonly asked questions to learn more about credit scores. <h3>Can you get a perfect credit score? </h3>Though it’s possible to achieve a perfect score of 850, credit scores often fluctuate for many reasons. Instead of trying to keep your score “perfect,” aim to keep your credit in the good-to-excellent credit range. <h3>What credit score should I aim for? </h3>A credit score of 670 or higher is generally considered good and will help you access better insurance rates, credit cards, and housing options. Keep in mind that your score may go up and down slightly, depending on when you make payments, how much available credit you have, and other factors. <h3>What is a decent credit score to buy a car? </h3>While there’s no industry-wide standard, you’ll get the best deal on an auto loan if your credit score is good. You can still buy a car with lower scores, but your interest rates will be much higher. <h3>Can you apply for a personal loan with average credit? </h3>If your credit score is on the lower side, you’ll likely have a harder time finding a personal loan or debt consolidation loan with good rates and terms. Take steps to improve your credit before applying to qualify for the best offers. <hr/><ol><li><a href="https://www.consumerfinance.gov/ask-cfpb/how-do-i-get-and-keep-a-good-credit-score-en-318/">Consumer Financial Protection Bureau</a>. “How do I get and keep a good credit score?” </li><li><a href="https://www.fico.com/en/newsroom/fico-score-remains-most-widely-used-credit-score-securitization-market-keeping-lender">myFICO</a>. “FICO Score Remains the Most Widely Used Credit Score in the Securitization Market, Keeping Lender Confidence.” </li><li><a href="https://www.myfico.com/credit-education/what-is-a-fico-score">myFICO</a>. “What is a FICO Score?” </li><li><a href="https://www.vantagescore.com/press_releases/the-complete-guide-to-your-vantagescore/">VantageScore</a>. “The Complete Guide to Your VantageScore.” </li><li><a href="https://www.myfico.com/credit-education/whats-in-your-credit-score">myFICO</a>. “What&#39;s in my FICO Scores?” </li><li><a href="https://www.consumerfinance.gov/ask-cfpb/how-do-i-get-a-free-copy-of-my-credit-reports-en-5/">Consumer Financial Protection Bureau</a>. “How do I get a free copy of my credit reports?”</li></ol>

A personal loan can be a smart financial move to pay off credit card debt, but it’s important to weigh out the pros and cons before you apply. 

Credit card debt can rack up fast—especially if you’re only able to pay the minimum amount due each month. Using a personal loan to pay off credit card debt comes with several benefits like one monthly payment, potentially lower rates, and an end date to your debt. Plus, your <a href="https://www.lendingclub.com/resource-center/personal-finance/what-affects-your-credit-scores">credit score</a> might get a boost when your credit card balances drop to zero. However, paying off credit card debt with a personal loan may not always make sense. Here’s what you need to know about using personal loans for credit card debt.  <h2>Should you use personal loans to pay off credit cards? </h2>Managing credit card debt often comes with headaches, and you might be considering a <a href="https://www.lendingclub.com/personal-loan">personal loan</a> to consolidate your balances. Commonly known as <a href="https://www.lendingclub.com/resource-center/personal-loan/what-is-debt-consolidation">debt consolidation</a>, using a personal loan can help you streamline multiple debts into one easy-to-manage payment—and sometimes pay it off faster and with less interest. No more keeping track of multiple due dates or scrambling to pay more than the minimum.   To consolidate your credit card debt with a personal loan, it’s best to shop around and compare rates with different lenders. Ideally, you want a personal loan with an interest rate lower than your existing credit cards. For instance, if your credit cards have an average interest rate of 20%, a loan with a 10% interest rate could help you save.  When comparing loans, consider the monthly payment amount, repayment period, and fees.   To get the most benefit, try to qualify for a loan that’s large enough to cover your credit card debt, with a lower interest rate, better terms, and little or no fees. Keep in mind that while you’ll no longer have credit card debt, a new personal loan is still considered debt. So it’s important to make your payments on time and understand how a <a href="https://www.lendingclub.com/personal-loan/credit-card-consolidation-loan">debt consolidation loan</a> can affect your credit scores.   Keep in mind, a <a href="https://www.lendingclub.com/resource-center/personal-loan/what-is-a-personal-loan-how-to-apply-in-3-simple-steps">personal loan</a> may be able to help you pay off your credit card debt, but it won’t change your money habits. So if you tend to use your credit cards often, you could rack up new debt quickly after you pay them off. To avoid getting into credit card debt again, limit new spending and try to only charge what you’re able to pay off completely each month. If the temptation to overspend is overwhelming, it’s okay to take a break from using your credit cards for a while.[1] <h2>Pros and cons of using a personal loan to pay off credit card debt </h2>Before using a personal loan to pay off credit card debt, it’s important to weigh the pros and cons. Here’s a closer look at some of the advantages and disadvantages that come with paying off your credit card balances with a debt consolidation loan.[1] <table><tr><td>Pros </td><td>Cons </td></tr><tr><td>Fixed interest rate and terms: Personal loans often have a fixed interest rate that’s usually lower than credit card <a href="https://www.lendingclub.com/resource-center/personal-loan/apr-vs-interest-rate-whats-the-difference">APRs</a>. </td><td>May not get a lower interest rate: You may not always qualify for a lower interest rate than your existing credit cards. </td></tr><tr><td>Single monthly payment: Streamline multiple payments into one easy-to-remember loan payment, which may be lower than your combined monthly credit card bills.  </td><td>Potential fees: Some lenders charge origination fees, prepayment penalties, late fees, and more, which affects the overall cost of borrowing.  </td></tr><tr><td>Improved credit scores: Credit utilization, or your credit card balance relative to its credit limit, is an important scoring factor, so paying off your cards completely might boost your credit scores. </td><td>Potential to overspend: It may be tempting to rack up charges on the cards you pay off, which could result in a costly cycle of debt. </td></tr><tr><td>Quick loan processing: With online lenders, like LendingClub Bank, the loan typically has a fast turnaround time from application to funding.  </td><td>You still have debt: Although potentially less costly than credit card debt, personal loans are still a type of debt. </td></tr></table><h2>Example of using a personal loan to pay off credit card debt </h2>To see how if using a personal loan for credit card debt makes financial sense, it’s important to run the numbers.   Let’s say you have three credit cards with a total balance of $15,000 and an average 27% APR. You decide to consolidate the debt using a personal loan, which has a three-year term, a 14% interest rate and a monthly payment of $512.66. At the end of three years, you’d pay a total of $3,455.92 in interest costs.   If you decided to instead keep the debt on the credit cards and put the same $512.66 toward the balances each month, it would take a little more than four years to clear the debt, and you’d pay $9,744 in interest.   Between the two strategies, the debt consolidation loan helps you save about $6,290 in interest and gets you out of debt quicker. When using a personal loan to pay off credit cards makes sense Using a personal loan to clear your credit card debt may be a good idea in the following situations:  <ol><li>You qualify for a lower interest rate. Personal loans generally have lower <a href="https://www.lendingclub.com/resource-center/personal-loan/how-to-get-a-good-personal-loan-interest-rate">i</a><a href="https://www.lendingclub.com/resource-center/personal-loan/how-to-get-a-good-personal-loan-interest-rate">nterest rates</a> than credit cards, so you may qualify for a lower rate, especially if your credit score is in good shape. </li><li>You want to consolidate your debt. If you’re tired of juggling multiple monthly payments, a debt consolidation loan can help you make the switch to one simple monthly payment. </li><li>You plan to pay off your credit card balances in full. If you’re working on becoming free of credit card debt, a personal loan is a commonly used strategy to bring credit card balances to zero. </li></ol><h2>When using a personal loan to pay off credit cards doesn’t make sense </h2>While a personal loan can be used to pay off a credit card, it may not be the best option in every situation. Here are some scenarios when you may be better off skipping a personal loan.[2]   <ol><li>You have a small amount of credit card debt. If your debt can be paid off over a short time, consider using the debt snowball or debt avalanche methods to pay off your cards. </li><li>Your spending habits need work. If overspending is an issue, try to improve your money management skills and learn how to stick to a budget. This strategy may help you avoid an ongoing cycle of racking up your cards and using a loan to pay them off.  </li><li>Your debt feels overwhelming. If you can&#39;t afford to pay off your debt, even with a loan, a nonprofit credit counselor may be able to help you stop collection calls with a <a href="https://www.lendingclub.com/resource-center/personal-loan/what-is-a-debt-management-plan">debt management plan</a>.  </li></ol><h2>The bottom line </h2><a href="https://www.lendingclub.com/resource-center/personal-loan/personal-loan-vs-credit-card-how-to-decide-which-is-right-for-you">Credit cards</a> are a convenient financial tool to pay for day-to-day expenses or an unexpected emergency. While it’s generally best to pay your credit card balances in full every month, it’s not always possible. High interest rates can make your debt climb fast—and if you’re late on a payment, you could get charged a late fee and take a hit to your credit. Paying off your credit cards with a personal loan can be a savvy financial move. Just be sure you’ve considered all the pros and cons before you apply.    <hr/><ol><li><a href="https://www.consumerfinance.gov/ask-cfpb/what-do-i-need-to-know-if-im-thinking-about-consolidating-my-credit-card-debt-en-1861/">Consumer Financial Protection Bureau</a>. “What do I need to know about consolidating my credit card debt?” </li><li><a href="https://www.consumerfinance.gov/ask-cfpb/what-is-the-difference-between-credit-counseling-and-debt-settlement-debt-consolidation-or-credit-repair-en-1449/">Consumer Financial Protection Bureau</a>. “What is the difference between credit counseling and debt settlement, debt consolidation, or credit repair?” </li></ol>

Should you lease or buy your next car? Leasing costs less on a monthly basis and puts limits on how you can use your car. Buying comes with ownership responsibility but will cost you less in the long run.

If you’re trying to decide whether to buy or lease a car, both options have benefits and drawbacks. When you buy, you own your car outright once you repay your auto loan, and you have more flexibility regarding mileage and vehicle customization than you would with a leased vehicle. But your upfront and ongoing maintenance costs could be higher when you buy—and your monthly payments probably will be, too.[1]  This guide can help you understand whether leasing vs. buying a car makes more sense for you. <h2>Leasing vs. buying a car: what’s the difference? </h2>Understanding the differences between leasing vs. buying a car can help you make an informed choice if you’re shopping for a new vehicle.  <table><tr><td>Factor </td><td>Buying a car </td><td>Leasing a car </td></tr><tr><td>Ownership </td><td>You’ll own your car after repaying your auto loan. </td><td>You won’t own your car or build equity with monthly payments.  </td></tr><tr><td>Upfront costs </td><td>Your upfront costs may be higher. </td><td>Your upfront costs may be lower. </td></tr><tr><td>Monthly payments </td><td>Your monthly payments may be higher, but you’ll only make them for your loan’s term. </td><td>Your monthly payments may be lower, but they’ll continue as long as you lease. </td></tr><tr><td>Insurance </td><td>Your insurance premiums may be lower. </td><td>Your insurance premiums may be higher. </td></tr><tr><td>Warranty protection </td><td>It may cover your car’s maintenance and repairs for a few years. </td><td>It often covers your car’s maintenance and repairs for your entire lease term. </td></tr><tr><td>Mileage </td><td>You won’t have mileage caps. </td><td>You’ll generally have mileage caps. </td></tr><tr><td>Flexibility to customize </td><td>You have more flexibility if you want to customize your car.  </td><td>You have less flexibility if you want to customize your car.   </td></tr><tr><td>Sellability </td><td>You can sell your car anytime or keep it as long as you want. </td><td>You cannot sell your car, and you’ll need to turn it in or buy it for its full value when your lease term ends. </td></tr><tr><td>Depreciation </td><td>You’ll need to consider depreciation when you sell or trade in your car. </td><td>You won’t need to consider depreciation, as it’s built into your lease agreement. </td></tr></table>  <h3>1. Ownership </h3>When you choose to <a href="https://www.lendingclub.com/resource-center/auto-refinance/tips-for-how-to-get-the-best-deal-on-a-new-car">buy a vehicle</a>, you will eventually own your car at the end of your loan term. With a lease, your monthly payments cover the estimated depreciation of your car with interest, so you won’t build equity or own your car at the end of its lease term.[1]   <h3>2. Upfront costs </h3>Your upfront costs may be higher if you choose to buy vs. lease a car. When you buy, you’ll generally need to pay sales tax on your car, plus registration and origination fees. Your lender might also require a down payment, which increases your initial costs.  Your initial costs may be lower with a lease because a down payment isn’t always required, though other fees apply. Your leasing company may charge acquisition and disposition fees, which cover the cost of setting up your lease agreement and cleaning and selling your car at the end of your term. You’ll also pay registration fees.[1]   <h3>3. Monthly payments </h3>When you buy or finance a car, your monthly payments go toward interest and loan principal, so they tend to be higher than what you’d pay with a leased vehicle. With a lease, your monthly payments go toward interest and the estimated depreciation of your car during its lease term.   Your payments might be higher if you choose to buy, but you’ll only make them during your loan term. After that, your loan will be repaid and you’ll own your car outright. When you lease, your monthly payments continue for as long as you choose to lease a car.[1]     <h3>4. Insurance </h3>You’ll probably need full-coverage insurance whether you lease or <a href="https://www.lendingclub.com/resource-center/auto-refinance/when-is-a-good-time-to-buy-a-car">buy a car</a>, but you might need more coverage for a leased vehicle. Full coverage typically includes collision, comprehensive, and liability insurance, but leasing companies often require gap insurance, too. Gap insurance protects the lessor if your car is totaled after an accident. It pays for the difference between what your vehicle is currently worth and the amount you owe on the loan.[2]    Besides having stricter coverage requirements, some lessors also limit your deductible, or the amount you pay out of pocket before insurance kicks in, which isn’t the case with lenders. Lower deductibles typically result in higher monthly payments.[3]     <h3>5. Warranty protection </h3>Leased cars often have warranties that are effective for your entire lease term. These warranties typically cover regular maintenance costs and repairs, so you won’t need to worry about high unexpected costs cropping up with a leased car.  On the other hand, if you buy a car new, it may have a warranty that covers certain maintenance or repair costs. But that warranty will likely only be effective for a few years, after which you’ll need to pay for regular maintenance and repairs.[4]  <h3>6. Mileage </h3>You can drive as many miles as you’d like when you buy or finance a car, but this usually isn’t the case when you lease. Leasing companies often cap your mileage at 12,000 or 15,000 miles per year, and fees typically apply if you exceed your allotted mileage.[1]  <h3>7. Flexibility to customize </h3>Buying a car gives you more flexibility to customize it compared to leasing. So if you’d like to tint your windows or upgrade your wheels, you can do so when you buy or finance a car—but not if you lease.   <h3>8. Sellability </h3>You can sell your car anytime when you buy or finance it. Unfortunately, you won&#39;t have this option with a lease because you can&#39;t sell a leased vehicle. Instead, you&#39;ll need to turn it in at the end of your lease term or buy it from the leasing company for its full value.[1] <h3>9. Depreciation </h3>Once you purchase a car, it typically loses value (depreciates) instantly. While <a href="https://www.edmunds.com/tco.html">depreciation</a> may be a concern if you own your car and try to sell it before you&#39;ve established positive equity (when the remaining loan balance is less than the car&#39;s current market value), it’s less of a concern with a leased vehicle. Rather than selling, you’ll turn in the leased car or buy it for its full value once your lease is up.[1] <h2>Pros and cons: Buying vs leasing a car </h2><table><tr><td> </td><td>Buying </td><td>Leasing </td></tr><tr><td>Pros </td><td>- Opportunity to build equity and ownership - Monthly payments end once loan is repaid - No mileage caps - Can sell your car at any time - More flexibility to customize - Insurance costs may be lower </td><td>- Monthly payments may be lower - Warranty may cover maintenance costs for entire lease term - Can turn in your car once lease term is up - Can get newer cars more often </td></tr><tr><td>Cons </td><td>- Monthly payments may be higher - Warranty may only cover maintenance and repairs for a few years - Car is a depreciating asset - Upfront costs may be higher </td><td>- No equity or ownership opportunity  - Fees may apply for certain actions - Insurance costs may be higher - Mileage caps often apply - Long-term costs may be higher </td></tr></table><h3>When leasing a car makes sense </h3>Leasing a car could be a better option than leasing if you:  <ul><li>Don’t drive far or frequently: Many leases have mileage caps between 12,000 and 15,000 miles annually, so leasing could make sense if you have a short commute or don’t drive often.  </li><li>Get new vehicles often: If you prefer the dependability and features of newer cars, leasing may be the right choice. Lease terms are typically short, and you can simply turn in your car and lease another, newer vehicle once your term ends.  </li><li>Want low maintenance costs: Many lease warranties cover certain maintenance and repair costs for your entire lease term, so you won’t need to worry about unexpected expenses. </li><li>Can afford ongoing monthly payments: While you might not pay for maintenance and repairs, you’ll make monthly payments for as long as you lease a car.  </li></ul><h3>When buying a car makes sense </h3>Buying a car could be better than leasing if you:  <ul><li>Have a long commute or drive often: Since leases often have mileage caps, buying a car may be your best option if you drive more than 12,000 or 15,000 miles a year.  </li><li>Have a down payment saved: If you have a down payment set aside for a new car, buying could be a better choice. Making a down payment means you may have instant equity and benefit from lower monthly payments.  </li><li>Keep vehicles for several years: Buying may be a better option if you typically keep cars for several years. You’ll eventually repay your auto loan and own your car outright—and the lack of monthly payments may mean more potential for long-term savings. </li><li>Want more flexibility: Buying could also make more sense than leasing if you want the freedom to customize your car as you please.  </li></ul><h2>The bottom line </h2>Ultimately, choosing between leasing vs. buying a car depends on your preferences, habits, and goals. Buying is likely the better choice if you have a long commute or want to own your car eventually. Buying may also result in long-term savings, though your upfront costs may be higher. When you buy, you can also choose to <a href="https://www.lendingclub.com/auto-refinancing">refinance your auto loan</a> if you’re not happy with the terms or your credit situation has improved.   On the other hand, leasing could be a good choice if you don&#39;t drive often and enjoy the benefits of newer cars. Leasing might help you save money in the short term, but perpetual monthly payments and higher insurance rates can mean higher long-term costs.    <hr/><ol><li><a href="https://www.consumerfinance.gov/ask-cfpb/what-should-i-know-about-leasing-versus-buying-a-car-en-815/">Consumer Financial Protection Bureau</a>. “What should I know about leasing versus buying a car?” </li><li><a href="https://www.iii.org/article/what-auto-insurance">Insurance Information Institute</a>. “What is auto insurance?” </li><li><a href="https://www.iii.org/article/insuring-leased-car">Insurance Information Institute</a>. “Insuring a leased car.” </li><li><a href="https://www.kbb.com/car-advice/car-leasing-guide/">Kelley Blue Book</a>. “Car Leasing Guide: How to Lease a Vehicle in 2024.”</li></ol>

Negotiating a salary is often expected after a job offer, and with the right preparation you may be able to meet your career, personal, and financial goals faster. 

Negotiating your salary after getting a job offer is an important part of the job hunt—and often expected by employers. However, an <a href="https://www.indeed.com/career-advice/pay-salary/how-to-negotiate-salary">Indeed</a> study reports that more than half (58%) of respondents don&#39;t typically negotiate their salary. Negotiating a salary after an offer doesn’t have to be intimidating. With a little bit of research, planning, and practice, you’ll be ready for the negotiations and one step closer to meeting your money goals.[1]  <h2>5 Tips to prepare for negotiating your salary </h2>Preparation is a key component of salary negotiation. Here are some of our favorite tips to consider before you make a counteroffer.  <h3>1. Do your research </h3>Look into typical rates for the job and industry around your location, so you can confidently ask for the top of your range. Salary transparency and information sharing is becoming more commonplace. This can help you gauge whether the salary offer is fair. Check online, ask recruiters, or talk to your network about average salaries for the role.  Did the employer give you a salary range upfront? Was it specific to your location and experience level? How does it compare to your research? If it&#39;s about average, you may have some wiggle room when you negotiate. Or if you notice that the offer is on the high end for the employer&#39;s range or industry average (or both), you may choose to negotiate for additional benefits or perks instead. <h3>2. Consider perks and benefits </h3>It&#39;s likely your offer included perks and benefits beyond the paycheck. Evaluate the employer&#39;s total compensation package to see if it makes sense for your personal, professional, and financial goals—in both the short and long term.   Is health insurance a must-have benefit, or do you already have a great plan through your spouse&#39;s employer? Are you looking for a job with just the basic benefits like health care, paid time off (PTO), and a retirement plan? Or do you want an offer that also includes extra perks like tuition reimbursement, paid parental leave, bonuses, stock options, or equity? What about remote or hybrid working options, flexible hours, or unlimited vacation? <h3>3. Know what you bring to the role </h3>Understanding your true value as a new team member is important when negotiating. You already know that the employer wants to hire you since they&#39;ve made an initial offer. However, does the offer reflect your actual worth?  If the number feels too low—based on what you bring to the table—this is your chance to reiterate all the great qualities that set you apart from other candidates in the first place. Do you have a specific type of training or a particular area of expertise? Do you have proven experience that uniquely benefits the employer? Remind them.  <h3>4. Rehearse the conversation </h3>The idea of negotiating a salary may feel intimidating or uncomfortable. Organizing your talking points ahead of time can help you feel more prepared for the conversation. Jot down your desired salary and any notes you need for the negotiation. Consider whether you&#39;ll be speaking with someone in human resources, the direct hiring manager, the owner of the company, or a recruiter. Will the meeting be in person, a video chat, or phone call?  Then practice, practice, practice. You can rehearse on your own in the mirror, record yourself, or ask a trusted friend for help. Ask for feedback to ensure you&#39;re coming across confident, but not cocky. Run through different scenarios—like the employer making a counteroffer, refusing your suggestion, or needing time to run the numbers.  <h3>5. Know when to end negotiations </h3>When salary negotiations get dragged out, it can be frustrating for you and the employer. It&#39;s usually best practice to make one or two counteroffers. If you&#39;re not able to come to an agreement after a few conversations, it may be time to walk away respectfully. Or if the employer&#39;s revised offer isn&#39;t exactly what you wanted, but still fits within your range, you can consider taking the role.  <h2>What not to do when negotiating your salary </h2>Keep these tips in mind to get the most out of your salary negotiation. <h3>1. Don&#39;t show your cards first </h3>The timing of compensation discussions varies widely by employer, industry, and even by state. Try to wait for the employer to make an offer before you tell them your salary goals. However, this may not always be possible if the employer or a recruiter asks about your salary expectations before making an offer. If this happens, provide a range that&#39;s acceptable to you—and don&#39;t lowball yourself. Remember, you can always negotiate down, but it&#39;s much harder to negotiate up from a lower number.  <h3>2. Don&#39;t settle for less than you&#39;re worth </h3>If negotiations are unsuccessful, you may be stuck with an offer that&#39;s less than you deserve and be tempted to take the job anyway. Accepting an offer that&#39;s less than your worth or below market value can have major financial consequences, like loss of income or less money for retirement. It may also mean the company won&#39;t have the budget for future salary increase, raises, or other perks. Consider taking a job with a lowball offer carefully. If the final offer is too low, it could be best to move on. <h3>3. Don&#39;t forget the written documentation </h3>A verbal agreement, handshake, or email is a great start to wrapping up a final negotiation. However, once you&#39;ve agreed on new terms, it&#39;s best to get the final offer in writing—ideally in a format that both you and the employer sign. Ask for written documentation of the salary, job description, benefits, perks, and any other details you negotiated. This may be a contract, offer letter, or other type of paperwork confirming what was discussed.  <h2>Can you lose a job offer by negotiating salary? </h2>It&#39;s unlikely a job offer will be rescinded just because you tried to negotiate the salary. However, if you&#39;re rude, arrogant, or too pushy, the employer may choose to pull their offer or leave you hanging with a &quot;We&#39;ll get back to you.&quot; If you do decide to walk away, be sure not to burn any bridges. Once you&#39;ve reached a stopping point in the salary negotiations, turn down the offer graciously. Consider writing a quick thank-you note or email to show your appreciation, and ask the employer to keep you in mind for future opportunities that may be a better fit. <h2>Why it&#39;s important to learn how to negotiate your salary </h2>Negotiating a salary isn’t usually just about the money, especially if you’re currently living <a href="https://www.lendingclub.com/resource-center/personal-finance/how-to-stop-living-paycheck-to-paycheck">paycheck to paycheck</a>. Yes, you&#39;re asking for a higher income, but you&#39;re also advocating for your career, family, and financial future. Keep that in mind if you&#39;re second-guessing your decision to negotiate.[2]  Some job seekers worry that asking for more money will make potential employers view them negatively. However, many employers actually expect potential hires to negotiate their initial salary offer—and the employer&#39;s initial offer often reflects that. Solid negotiation skills can help you boost your income, but it can also boost your work-life balance with a strong compensation package.   <h2>The bottom line </h2>Salary negotiations can feel intimidating at first, but remember, they&#39;re considered common after an employer makes you an initial offer. Plus, a higher salary can help make it easy to <a href="https://www.lendingclub.com/resource-center/personal-finance/how-little-can-you-live-on-tips-for-frugal-living">live within your means</a> and meet your financial goals. While it may not always be possible to get the salary you wanted, with the right negotiation skills you may be able to find a happy compromise. Or, if you&#39;re still not feeling valued, you can pass on the offer and continue finding a better-paying role.  <hr/><ol><li><a href="https://www.roberthalf.com/us/en/insights/career-development/how-to-negotiate-salary-after-getting-job-offer#:~:text=Yes%2C%20it's%20absolutely%20okay%20to,want%20to%20ensure%20fair%20compensation.">Robert Half</a>. “How to Negotiate Salary After You Get a Job Offer.” </li><li><a href="https://files.consumerfinance.gov/f/201501_cfpb_digest_financial-well-being.pdf">Consumer Financial Protection Bureau</a>. “Financial well-being: What it means and how to help.” </li></ol>

From groceries and diapers to Halloween costumes for pets, nearly 60% of American consumers prefer to shop online for everyday items that make life more convenient, comfortable, and enjoyable. And with rising prices showing no signs of stopping anytime soon, we’re pleased to introduce StackitTM from LendingClub Bank—a new browser extension that automatically finds and rewards eligible members with coupons and cash back for extra savings at more than 15,000 favorite online retailers.

From groceries and diapers to Halloween costumes for pets, nearly 60% of American consumers prefer to shop online for everyday items that make life more convenient, comfortable, and enjoyable. And with rising prices showing no signs of stopping anytime soon, we’re pleased to introduce StackitTM from LendingClub Bank—a <a href="/member-benefits/stackit/install?utm_source=Internal&utm_medium=Blog&utm_campaignid=stackit_launch">new browser extension</a> that automatically finds and rewards eligible members with coupons and cash back for extra savings at more than 15,000 favorite online retailers.<h2>Limited Time Offer to Double Your Cash Back Through 12/31/22</h2>Stackit is a free, new cash back and rewards program available to personal loan members that’s easy to download and install. Eligible members can activate their favorite offers with one click to start saving while stacking cash back offers with existing loyalty program rewards at eligible stores.“We’re relentless when it comes to giving customers more, and Stackit is a perfect example of this,” said Amber Carroll, SVP of Membership and Lifecycle Marketing. “Stackit appears as you shop so it’s easier to activate. You can redeem your cash back for gift cards from hundreds of online stores. And you can continue accumulating loyalty points from merchants and rewards from credit cards while we stack coupon savings and cash back earnings on top of all of it,” she said. “Stackit demonstrates our promise to help members make smart money moves that are both easy and rewarding.”To celebrate the new Stackit rewards program, LendingClub is offering its personal loan members double the cash back on eligible purchases made now through the end of the year. To start earning and stacking rewards, eligible members can simply <a href="/member-benefits/stackit/install?utm_source=Internal&utm_medium=Blog&utm_campaignid=stackit_launch">add the new Stackit Extension</a> to their browsers—doubling their earnings for a limited time through 12/31/22.* Cash back can be redeemed for e-gift cards through the Earnings Dashboard.<h2>New Name, Better Rewards</h2>Earlier this year, LendingClub soft-launched its exclusive member rewards program as a separate Chrome browser extension test that was made available to a small subset of customers. Drawing from these learnings,Stackit is LendingClub Bank’s new and improved rewards program featuring a new extension, expanded browser availability, and enhanced account integration that is rolling out to a wider member audience beginning in November.Currently, any LendingClub personal loan member can download and start using the new Stackit browser extension. (Users of the old LendingClub Chrome Extension can continue earning cash back through 11/30/22; any amount remaining in users’ accounts after 11/30 will automatically be paid out via PayPal. Members are advised to add the new Stackit Extension to continue earning cash back and rewards, including double cash back, on future purchases.) In addition to Chrome,Stackit expands browser availability to Safari and Edge, and enables members to view recent transactions and cash back earnings inside their LendingClub account instead of a third-party site. Planned rollouts to LendingClub members with Auto, Deposit, and other accounts beyond personal loans are expected, however, timing is still under consideration.*Double Cash Back Offer on eligible transactions expires 12/31/22. See <a href="/legal/terms-of-use">Terms of Use</a> for full details. Offer is subject to change without notice.Stackit is a non-deposit product offered by LendingClub Bank.

Even in today’s low-yield, high-inflation environment, it’s essential to keep a certain amount of money in an easy-to-access checking or savings account for things like daily household and emergency expenses, or to meet short-term financial goals. 

Even in today’s low-yield, high-inflation environment, it’s essential to keep a certain amount of money in an easy-to-access checking or savings account for things like daily household and emergency expenses, or to meet short-term financial goals. However, recent <a href="https://www.fdic.gov/analysis/household-survey/">FDIC research</a> shows approximately 7.1 million Americans are “unbanked,” meaning they do not have a basic checking or <a href="/personal-savings">savings account</a>.<h2>Being Unbanked Increases Costs for Families</h2>Reasons for being unbanked (and underbanked) vary from not having enough money to meet a minimum balance and high or unpredictable fees, to having a history of credit, ID, or banking problems, and/or a general distrust of financial institutions.As a result, this drives unbanked individuals to expensive, alternative financial outlets—such as check cashers, payday lenders, and pawn shops that charge high fees for financial products and services—to manage their money. Such fringe financial “solutions” hold people back from making meaningful financial progress, many of whom are living on low incomes and, likely, already struggling to make ends meet. Without a <a href="/personal-checking/rewards-checking">checking account</a>, these families wind up overpaying for basic financial transactions, making it difficult for them to build savings and assets over time.<h2>More Rewarding Banking for More People</h2>In light of this, we’re proud to share that recent improvements to LendingClub Bank’s <a href="/personal-checking/rewards-checking">award-winning Rewards Checking</a> has earned us official certification by the national Cities for Financial Empowerment Fund as meeting the BankOn National Standards for trust and affordability for consumer transactional accounts.Key features of our award-winning Rewards Checking account include:<h3>Low Minimum Opening Balance</h3><ul><li>Access Rewards Checking with an opening deposit of only $25</li><li>Freedom from Fees Save more of your hard-earned money with no overdraft, monthly maintenance, and incoming wire transfer fees1</li></ul><h3>Unlimited Cash Back</h3><ul><li>Earn <a href="/personal-checking/rewards-checking">unlimited 1% cash back</a> on Qualified (signature-based) Purchases when using your Rewards Checking debit card2</li></ul><h3>Free ATM Access</h3><ul><li>Enjoy <a href="/help/checking-accounts-faq/how-do-i-earn-atm-rebates-on-my-checking">ATM access with no LendingClub ATM fees</a>, plus get unlimited ATM fee rebates on fees charged by other banks3</li></ul><h3>Get Your Paycheck Early</h3><ul><li>Set up direct deposit into your account and you could be eligible to receive your money up to 2 days earlier4</li></ul><h3>Earn Interest</h3><ul><li>Earn an APY that’s more than the national average with account balances of at least $2,5005</li></ul><h3>FDIC Insurance</h3><ul><li>Rest easy knowing your deposits are FDIC-insured up to the maximum amount allowed—$250,000 per depositor for each ownership category</li></ul><h3>Best Online Experience</h3><ul><li>Based on our easy-to-use mobile app and award-winning <a href="/personal-checking/rewards-checking">online checking account</a>, NerdWallet named us Best Bank or Credit Union for Online Experience</li></ul><h2>What Our Members Say</h2>It’s important knowing we’re offering products and services that are helping to improve the financial lives and stability of all Americans, including unbanked and underbanked individuals and families, in every community across the United States.Here’s what some of our members have to say about their Rewards Checking experience with LendingCLub Bank:“I never knew how much money I was losing with my old bank whenever I used an ATM. [LendingClub Bank] reimburses fees from ATM’s and now I look forward to getting the cash back every month.”Robin, a LendingClub Bank Member“The rewards checking account with cash back every month has helped me ditch my credit card and debt.”Lauren, a LendingClub Bank MemberRead more member reviews.<h2>Your Financial Well-Being Matters to Us</h2>At LendingClub Bank, making <a href="/personal-checking/rewards-checking">checking accounts</a> more rewarding for more people is an example of our belief that financial well-being should be attainable for everyone—not just for those who can afford it. Everything we do is centered around empowering our members to meet their personal financial goals by enabling access to a broad range of financial products, services, and educational resources, all designed to help them pay less when borrowing and earn more when saving. Testimonials reflect the real-life experiences of individuals who used our products; however, individual results may vary.<hr/><h4>Terms and Conditions</h4>Accounts subject to approval. $25 minimum opening deposit required. See Product Terms &amp; Conditions for additional details.1. Miscellaneous fees may apply. View Product Terms &amp; Conditions for complete details.2. The Debit Card Rewards Program (“Cash Back Rewards”) provides 1.00% cash-back on all Qualified Purchases using a debit card tied to an Eligible Account.Eligible Accounts are: Rewards Checking accounts that meet the following requirements for the calendar month in review:1). Maintain an average monthly balance of at least $2,500.00; or 2). Receives at least $2,500.00 in Qualifying Direct Deposits.Qualifying Direct Deposits are defined as: Recurring Automated Clearing House (ACH) credits, including payroll, pension or government payments (such as Social Security) made by your employer, or an outside agency. We may require documentation to verify that credits are Qualifying Direct Deposits. Qualifying Direct Deposits do not include peer to peer payments or ACH transfers (funds transfers) from your external accounts.Qualified Purchases are defined as: Signature-based purchases made using the debit card tied to an Eligible Account. These are “credit” purchases that can be made in stores and online. To make a signature-based purchase, select “credit” rather than debit at point-of-sale kiosks. The “credit” option is most often pre-selected when making purchases online using a debit card. Online subscription payments may not be considered signature-based purchases. The payment transaction type (signature-based or other) is ultimately decided by the merchant and is based on how the transaction is transmitted at the time of processing. Qualified Purchases do not include: (1) any goods or services purchased that are returned or otherwise credited to your Eligible Account; (2) unlawful purchases; or (3) purchases of currency, cash or cash equivalents (including, without limitation, currency from the U.S. Mint, Travelers Checks, gift cards, cryptocurrency, casino chips, peer to peer payments, prepaid debit cards, account openings, loan payments, or other cash equivalents). We may report the value of Cash Back Rewards to the IRS as required by law. Any client whose tax status would require us to impose tax withholding of any sort will not be eligible for Cash Back Rewards. Accounts are reviewed after the end of each month. Any earned Cash Back Rewards will be credited to your account on or before the 10th calendar day of the next calendar month. The Eligible Account must be open and active at the time the Cash Back Reward is credited.3. LendingClub does not charge a fee for using another bank’s ATM. Plus, get unlimited automatic ATM surcharge rebates for ATM fees other banks charge you. ATM surcharge rebates apply to cash withdrawals from a Rewards Checking account. ATM fees will be rebated at the end of each statement cycle. Excludes international exchange fees. LendingClub makes its best effort to identify those ATM fees eligible for rebate. In the event that you have not received a rebate for a fee you believe is eligible, please contact Customer Service at 800.242.0272. LendingClub reserves the right to modify or discontinue the ATM surcharge rebate program at any time. Out-of-network ATM fees cost $2.50 on average — source: CNBC as of 01/26/2022. If someone were to use an out-of-network ATM 6 times per month at an average fee of $2.50 per withdrawal, they would spend $180 in ATM fees in 12 months.4. Any account features that enable you to receive direct deposits, or that enable direct deposit funds to be made available to you early, are contingent upon and subject to the payor’s support of such features. 5. Annual Percentage Yield (APY) accurate as of 8/1/2022. Rate tiers are as follows: 0.00% APY applies to balances of $0.00–$2,499.99, 0.10% APY applies to the entire balance on balances of $2,500.00–$99,999.99, and 0.15% APY applies to the entire balance of $100,000.00 or more. Rates are variable and are subject to change, at the discretion of the bank and without notice, at any time after an account is opened. Fees may reduce earnings.

Since 2007, LendingClub has been on a mission to deliver a world-class experience to all our members. This month we took a moment to reflect on the more than four million members who have chosen LendingClub as their partner to help them reach their financial goals.

Since 2007, LendingClub has been on a mission to deliver a world-class experience to all our members. This month we took a moment to reflect on the more than four million members who have chosen LendingClub as their partner to help them reach their financial goals.As the leading digital marketplace bank in the U.S. built on the belief that innovative, creative solutions deliver more value and a better experience, we’re always looking for new ways to provide more. In early 2021, LendingClub became a bank holding company operating a national bank, allowing us to expand our products and level the playing field for everyone.  “Every day we help members leverage their money so they can earn more when saving and pay less when borrowing,” said Amber Carroll, Senior Vice President of Membership &amp; Lifecycle Marketing at LendingClub. “We&#39;re working to redefine banking, which means ensuring our interests are well aligned with those of our members and introducing new ways to better serve their needs.” Since the beginning of the pandemic, how we work, live, and manage our finances has evolved in ways most of us would never have imagined. Increasingly, more Americans across varying credit profiles are struggling to stretch their dollars between paychecks. According to a recent survey from LendingClub and PYMNTS, even among workers earning more than $100,000 per year nearly half are living paycheck to paycheck.  At LendingClub, we’re inspired every day by our members who continue to strive for financial well-being during these unprecedented times—such as by consolidating their credit card debt into a single, more manageable payment, refinancing their auto loan to free up room in their budget, or taking advantage of a CD or high-yield savings account to invest in their future. The Club is working hard to help members reach their goals and we’re incredibly proud to help simplify their path. As one of member recently shared: “This is the third time I have utilized LendingClub&#39;s great rates and lending plans to assist with home repairs and debt consolidation. Their application and payment processes are quick and simple to use. I have saved so much time and money using this funding!” — Christine, a member from Texas We believe everyone deserves a better financial future. If you’re ready to improve your financial well-being and are not already a member of the Club, we can help. From banking smarter with your <a href="/personal-deposits/online-banking">personal checking and savings</a>, to working toward larger financial goals—like <a href="/personal-loan">consolidating debt</a>, <a href="/auto-refinancing">refinancing an auto loan</a>, or making home improvements—you can easily check your rate for a personal loan in minutes, with no impact to your credit score. Thanks again to all of our members for helping us achieve this incredible milestone.

In March 2022, we hosted our first quarterly webinar where we celebrated our one-year anniversary as a digital marketplace bank. 

In March 2022, we hosted our first quarterly webinar where we celebrated our one-year anniversary as a digital marketplace bank. During the webinar, Anuj Nayar, our Financial Health Officer, discussed:<ul><li>Our journey to get to where we are today </li><li>Lessons learned from our 15-year history as a fintech pioneer</li><li>How we’re leveraging our digital marketplace bank to further our mission to help Americans on their path towards financial health</li><li>We recently reported Q4 2021 and year-end earnings</li><li>New data on the financial health of U.S. consumers from our latest Paycheck-to-Paycheck report</li></ul>A historic milestone, as one of the first fintech company to acquire a national bank we’ve paved the way for other fintechs to follow suit. With 15 years under our belt, more than 3.9 million members, and over $70 billion in loan originations, the marriage of LendingClub’s marketplace fintech business with all the benefits of being a bank is fundamentally changing the nature of our business and influencing change across the banking industry as a whole. We’re also creating something new for our members -- a bank that puts the customer at the center of what we do. <a href="https://vimeo.com/686043451">Check out the video below to learn more.</a>

LendingClub completed the acquisition of Radius Bank in February 2021. At that time, in addition to the direct-to-consumer deposit business, we inherited a fintech partner program, and several lending businesses. As we reach the one-year anniversary of the acquisition, and in conjunction with the conclusion of a strategic review of our business operations, we have made the decision to discontinue certain businesses that don’t fit our mission.  

LendingClub completed the acquisition of Radius Bank in February 2021. At that time, in addition to the direct-to-consumer deposit business, we inherited a fintech partner program, and several lending businesses. As we reach the one-year anniversary of the acquisition, and in conjunction with the conclusion of a strategic review of our business operations, we have made the decision to discontinue certain businesses that don’t fit our mission.  This includes our yacht loan business. Yacht loans are simply not in line with our mission to help everyday Americans on their path to financial health and we plan to grow our auto refinance business to take its place.  During the review, we also thoroughly examined relationships and operating activities for the fintech partners. As a result of our review, we are asking certain partners to modify their activities and/or operations to match expectations and contractual commitments, and we have begun exiting certain partners. As part of the ongoing dialogue with these partners, we have discussed transition plans or operational changes that could impact the services available to these partners and their customers.   As a pioneer in this space, we have a unique perspective. We operated for 15 years as a fintech with a partner bank model and now we operate as a fintech, a bank, and a partner bank. We work hard at LendingClub to maintain and build a robust, secure, compliant and scalable enterprise. We are guided by our core values, our extensive experience, our deep data set and technology investments, and governed by strong controls, to deliver on behalf of our members, communities, shareholders, partners, and team members.  These business model changes will have no material effects on our business operations and we plan to report more details when we issue our Full Year 2021 and Q4 earnings in a few weeks. Scott Sanborn CEO  LendingClub<hr/>Safe Harbor StatementSome of the statements above, including statements regarding  the effect on our business operations as a result of the business model changes, are &quot;forward-looking statements.&quot; The words &quot;anticipate,&quot; &quot;believe,&quot; &quot;estimate,&quot; &quot;expect,&quot; &quot;intend,&quot; &quot;may,&quot; &quot;outlook,&quot; &quot;plan,&quot; &quot;predict,&quot; &quot;project,&quot; &quot;will,&quot; &quot;would&quot; and similar expressions may identify forward-looking statements, although not all forward-looking statements contain these identifying words. Factors that could cause actual results to differ materially from those contemplated by these forward-looking statements include those factors set forth in the section titled &quot;Risk Factors&quot; in LendingClub&#39;s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, each as filed with the Securities and Exchange Commission, as well as in LendingClub&#39;s future filings made with the Securities and Exchange Commission. LendingClub may not actually achieve the plans, intentions or expectations disclosed in forward-looking statements, and you should not place undue reliance on forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in forward-looking statements. LendingClub does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

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{noun} A type of credit that allows the borrower to make charges and payments against a set borrowing limit, paying interest only on outstanding balances.

A type of credit that allows the borrower to make charges and payments against a set borrowing limit, paying interest only on outstanding balances.<h2>What is Revolving Credit?</h2>Revolving credit is a type of credit that lets you borrow money as needed up to an amount called your credit limit. Borrowing reduces your available credit, and repayment replenishes your credit limit (minus the interest and fees charged). Revolving credit does not have a fixed number of payments. This differs from installment credit which lets you borrow a lump sum and pay it back over a set number of fixed monthly payments.<h2>How Does a Revolving Line of Credit Work?</h2>It helps to think of a revolving line of credit as a renewable source of funds within a set credit limit. The lender sets the credit limit upon application approval. You can use as much of your credit limit as you need, paying interest only on the money you borrow. As you repay what you’ve borrowed (plus interest and fees), your available credit replenishes, and you can continue borrowing against your revolving line up to the credit limit.<h3>Types of Revolving Credit</h3>The most common revolving credit products are lines of credit and credit cards.Lines of credit come in different forms, including home equity lines of credit (HELOCs), personal lines of credit, and business lines of credit. Credit lines are typically issued by banks and credit unions, and generally you can draw on your line using special checks, ATM, telephone, and online banking. You’ll only pay interest on the money borrowed from your line of credit. Some lines of credit may be limited in how the funds can be used, such as only for balance transfers from credit cards.Credit cards are revolving credit accounts that, unlike lines of credit, require you make a purchase or cash advance to access your credit line. While card issuers reserve the right to change your credit limit, you can access your available credit as long as your account is in good standing. When you make purchases on a credit card, you can repay the balance in full by the end of your billing cycle to avoid interest charges and fees. If you don’t pay your outstanding balance in full,the balance “revolves,” or rolls over, to the next month and will accrue interest until paid in full. Note: Both lines of credit and credit cards can be secured or unsecured. Secured accounts require collateral; unsecured accounts do not. For example, a HELOC uses your home as collateral. Credit cards are typically unsecured, but some secured cards require cash deposits as collateral.<h3>Why is Revolving Credit Important?</h3>Revolving credit offers greater borrowing flexibility than installment credit. For instance, if you get a $10,000 installment loan for a home remodeling project, you typically receive all the money at once and must start repaying on the entire loan balance immediately plus interest on that amount—even if you don’t use the funds right away. If you need more money, you’ll have to apply for a new loan.On the other hand, if you get a line of credit or credit card with a $10,000 limit, you can draw on it as needed—say, $1,000 in January, $2,000 in April and $1,500 in June­—and interest will accrue only on the amounts you borrow. As you pay back what you’ve borrowed, your available credit is restored up to your credit limit, so you can make future purchases without needing to apply for additional credit.Since it doesn’t require fixed monthly payments, revolving credit can also offer greater payment flexibility than installment loans. If money is tight in a particular month, you have the option of only making the minimum payment on a revolving account, potentially making it easier to meet other financial obligations.Revolving credit can also serve as a financial cushion. Even if you never use it, it’s there in case you need quick access to small amounts of cash in an emergency.<h3>What Are the Risks of Revolving Credit?</h3>Revolving credit has some drawbacks you should be aware of.Collateral risk: If you fail to make payments on a secured revolving credit account, you could lose your collateral. With a secured credit card, that loss could be a few hundred dollars. With a HELOC, you stand to lose your home.High interest rates: Revolving credit typically has higher interest rates than installment credit. Interest rates for most credit cards and many lines of credit are also variable, meaning they can change over time based on economic conditions.Excessive debt: If you only make the minimum payment on a credit card, you could accumulate a large balance. Credit card interest is typically compounded, meaning interest accrues on both the balance of your purchases and on previously applied interest. Compound interest can cause your balance to snowball until it’s difficult to pay down.<h3>How Does Revolving Credit Affect Your Credit Score?</h3>Revolving credit could help your credit score in several ways.<ul><li>On-time payments: Making revolving credit payments on time could boost your credit, since timely payments are a major factor in your FICO® Score.</li><li>Responsible credit utilization: Keeping your revolving credit balance below 30% of your credit limit could increase your credit score. Ideally, you would pay your credit card balances in full each month.</li><li>Diverse credit mix: A variety of accounts, including installment credit and revolving credit, could show lenders you can successfully manage different types of debt.</li></ul>Revolving credit could also have negative impacts on your credit score when not managed responsibly. Late payments: Missing payments could have a significant negative impact on your credit score. Setting up auto-payments on your revolving credit accounts can help ensure you never miss a due date.Excessive credit utilization: Consistently carrying balances that exceed 30% of your available credit limit can reduce your credit score. Hard inquiry: When you apply for revolving credit, creditors perform a credit check called a hard inquiry, which could cause a small, temporary dip in your credit score.

{noun} The total annual cost to borrow money, including fees, expressed as a percentage.

<h2>What is Annual Percentage Rate (APR)?</h2>Annual percentage rate (APR) is the cost of borrowing money on an annual basis. APR is expressed as a percentage, to make it easier to compare the cost of credit. APR and interest rate are sometimes used interchangeably, however, APR and interest rate are different. APR includes both interest plus fees applied over the course of a loan. Because APR is a more complete measure of the cost of credit, it is usually higher than the interest rate.<h2>How is Annual Percentage Rate Calculated?</h2>To calculate APR on a loan, you’ll need to know a few other numbers first:Interest: The total interest charges paid over the life of the loan, also known as the cost of borrowing money.Fees: Review the terms and conditions of the loan to find the fees that apply to your loan. Fees vary by loan type and lender. Principal: The original loan amount.Days in the Loan Term (n): Since APR measures the annual cost of borrowing money, multiply 365 (days) by the number of years in the loan term. For loan terms under one year, use the number of days.The formula to calculate APR is: <img src="//images.ctfassets.net/orqped9h4wgz/6cJEgR4ftSGoIaSuKLlek6/a3ce252e07839182be4e7550cd09e08a/Formula-Calculate-APR.png" alt=""/>The steps to calculate APR are:<ol><li>Find the interest charges</li><li>Add the fees</li><li>Divide the sum by the principal balance</li><li>Divide by the number of days in the loan’s term</li><li>Multiply by 365</li><li>Multiply by 100</li></ol><h3>Credit Card APRs</h3>Credit card APRs do not reflect fees and since a credit card has no set loan amount or fixed repayment term, its APR is simply its interest rate.Under the Truth in Lending Act, passed in 1968, lenders and other financial institutions must disclose APR when offering credit. <h2>Why is Annual Percentage Rate Important?</h2>Knowing the annual percentage rate helps you understand the true cost of borrowing. For example, all lenders are required to disclose APR, which makes it easier to compare loans from different banks and make a more informed borrowing decision.<h2>Are There Different Types of APRs?</h2>There are different categories of APRs depending on the type of financial product.<h3>Credit Card APRs</h3>Credit cards have several APRs that may apply to different transactions or account activities.<ul><li>Purchase APR: The rate you pay for purchases. </li><li>Balance transfer APR: The rate applied if you use a card to pay down balances on other credit cards or loans. </li><li>Cash advance APR: The rate charged on ATM withdrawals or cash-equivalent transactions, like money-order purchases. </li><li>Introductory APR: A promotional interest rate for a limited period of time that is lower than the card&#39;s regular APR, sometimes as low as 0 percent APR.</li><li>Penalty APR: A higher-than-normal rate that results from violating a card’s terms of service. </li></ul><h2>What’s the Difference Between Fixed and Variable APRs?</h2>APRs can be fixed or variable. A fixed APR remains unchanged for the life of your loan. A variable APR fluctuates in sync with a published market index, like the U.S. Prime Rate. <h3>Adjustable-Rate Mortgages</h3>Home loans with variable interest rates are called adjustable-rate mortgages (ARMs). With an ARM, your APR is fixed for an initial term (typically one, three, or five years, but sometimes as long as 10 years), then resets every six or 12 months, based on market rates. <h2>What Affects APR?</h2>The APR you&#39;re offered depends on a few factors: <ul><li>Whether a loan or line of credit is secured or unsecured</li><li>Current economic conditions</li><li>Your credit history</li></ul>Lenders may also consider your income and assets, down payment, and where you live when determining your APR.<h2>How Do You Get a Good APR?</h2>Getting the best APR on a loan or credit card typically requires shopping around. Start by prequalifying with multiple lenders. Prequalifying is a quick process where you provide some basic information about your income and borrowing goal. Then, lenders respond with a preliminary, non-binding estimate of the loan amount and APR. This is typically done through a soft credit check, which doesn’t impact your credit.Then, compare the preliminary offers and submit a full application to your lender of choice. With your detailed financial information and a hard credit inquiry, which will impact your credit, lenders can make a formal loan offer that includes your APR, fees, and repayment terms. If you’re unhappy with the terms you’re offered (or if lenders decline your applications), your credit history might be the culprit. If this is the case, you can work to pay down your existing debts and bring late payments current, which can improve your credit score and chances for approval over time.

{noun} The amount of unpaid interest that has accumulated as of a specific date, either on a loan or an interest-bearing account or investment. 

<h2>What Is Accrued Interest? </h2>Accrued interest is the amount of unpaid interest that has accumulated as of a specific date, either on a loan or credit card you’re repaying or on an interest-bearing account or investment.   Accrued interest can be owed or earned. For example, with a loan or credit card, it’s the amount of interest (payment you owe) that has been incurred since you made your last payment. With an interest-bearing account or an investment, such as a bond, it&#39;s the interest (income you earned) that has accumulated since the last time you received a payment from the financial institution or bond issuer. <h2>How Does Accrued Interest Work? </h2>The way accrued interest works depends on several factors, including the type of account, the balance or principal, the interest rate, timing, and whether you are borrowing money (such as with credit cards, auto loans, and personal loans), or earning money (such as with interest-bearing checking or savings accounts).  <h2>Accrued Interest on Loans </h2>Personal loans, auto loans, and other types of debt charge interest to their borrowers. Most lenders use the simple interest method of accounting, which means that interest that accrues each day is based only on the principal balance of the loan and doesn&#39;t compound on previously accrued interest. For example, on a personal loan, the interest on your debt accumulates daily based on your current loan balance and interest rate. When you make a loan payment, a portion of your total payment amount goes toward the interest that has accrued since your last payment and the remainder goes toward paying down the principal balance of your loan. If you have a fixed interest rate, the daily interest amount will go down over time as your principal amount owed decreases with on time payments. With variable rate loans, the amount of interest that accumulates can fluctuate along with the loan&#39;s interest rate, however there&#39;s generally a downward trend with timely payments.   <h2>Accrued Interest on Bank Accounts </h2>Generally, with interest-bearing deposit accounts, such as a high-yield checking or savings account, interest typically accumulates daily and is paid out monthly. The amount of interest that accrues is based on your balance and the account&#39;s annual percentage yield or APY (which may adjust higher or lower as rates rise or fall) and compounding interest. The higher the APY and your balance, the more you&#39;ll earn. Also, most banks and savings institutions will compound the interest you earn, usually daily. This means that the interest that accrues each day is based not only on your principal account balance but also on the interest that has accumulated since the last payment.  For example, let&#39;s say you have a $10,000 balance in a savings account with an interest rate of 5%. On the first day, your balance earns $1.37 in interest, and that gets added to your interest-earning principal—compounded—at the end of the day. That happens every day. By the end of the year, your principal will have grown to $10,512.67—$500 in interest on your principal balance, and $12.67 from the interest earned on your interest.   Calculation for daily interest rate: 0.05 / 365 = 0.000136986  Calculation for first day’s interest: 0.000136986 x 10000 = 1.36986  While your interest rate is 5% compounded daily; your total return including compounding, or <a href="https://blog.lendingclub.com/apr-vs-apy-whats-the-difference">annual percentage yield</a>,  is 5.1267%. Compounding interest increases your savings over time, especially in a rising interest rate environment. <h2>Accrued Interest on Bonds </h2>If you&#39;re investing in bonds, interest is typically paid out every six months, and the amount that accrues between payments depends on the face value of the bond and its interest rate. This calculation is known as yield to maturity. Interest on bonds does not compound; that is, you don’t earn interest on your interest. <h2>How Accrued Interest Affects Borrowers </h2>If you borrow money, understanding accrued interest gives you an idea of how your loan&#39;s costs are incurred. As you make your regular monthly payments, for instance, the amount of interest that accumulates over time decreases. And if you make additional principal payments on top of your regular payments, you can reduce how much interest accrues even more.   Keep in mind that, if you make an extra payment on a loan the lender may use some of that money to pay off the interest that has accrued since your last regular payment unless you specify otherwise. You can request that the lender put the full amount of your additional payment toward the principal balance, saving you more money on interest in the long run. Understanding how accrued interest works is particularly important if you have student loans. While college students aren&#39;t typically required to make monthly payments while they&#39;re still in school, interest accrues from the moment the loans are disbursed.  For borrowers with federal subsidized loans, the federal government will typically pay interest that accrues while they&#39;re in school and during future deferment periods. If you have unsubsidized loans or private student loans, all the interest that accumulates while you&#39;re in school (and during periods of deferment or forbearance) is added to your balance once repayment begins.  If you want to avoid a growing balance, consider making interest-only payments while you&#39;re still in school. <h2>How Accrued Interest Benefits Savers </h2>If you have an interest-bearing deposit account, look into how often (daily, weekly, monthly, quarterly, semi-annually, annually) your financial institution compounds the interest that accrues in your account. The more frequently interest is compounded (e.g., daily vs. quarterly) makes it possible for you to earn more interest more quickly. And if you&#39;ve invested in bonds, understanding how accrued interest works can help ensure that you get the money you&#39;ve earned, especially if you sell the bond between scheduled interest payments. For example, if you sell a bond three months after your last payment, you won&#39;t receive the amount of interest that accrued during that time. Because the buyer will receive the full semi-annual (every six months) interest payment despite only owning the bond for three months, they should pay you the amount that has accrued since your last payment on top of the price of the bond. <h2>How Is Accrued Interest Calculated? </h2>On loans, lenders generally calculate interest on a daily basis using either a 360-day or 365-day year. The lender will divide the loan&#39;s interest rate by one of those numbers to determine your daily interest rate, which it then applies to your balance. On interest-bearing deposit accounts, interest generally accrues daily. Depending on how often your financial institution compounds interest, the amount that accrues each day may be calculated based on the principal balance plus previously accrued interest. <h2>What Is an Example of Accrued Interest?  </h2>Let&#39;s say you have a personal loan with a $20,000 principal balance and a 12% interest rate. To calculate the amount of interest that accrues every day, you&#39;ll do the following equation: Calculation for daily interest rate: 0.12 / 365 = 0.000328767123288 Calculation for daily accrued interest: 0.000328767123288 x $20,000 = $6.58   In other words, you&#39;ll have $6.58 in daily accrued interest. Over 30 days, that amounts to $197.40.

A debt that is written off as a loss because the financial institution or creditor believes it is no longer collectible due to a substantial period of nonpayment.

A debt that is written off as a loss because the financial institution or creditor believes it is no longer collectible due to a substantial period of nonpayment.<h2>What Is a Charge-Off?  </h2>A charge-off on your credit report indicates the financial institution or creditor has written the account off as a loss and has stopped attempting to collect on a debt that you owe. However, a charge-off does not mean your debt is forgiven—it may be transferred to a collection agency or sold to a debt buyer. As long as the debt remains outstanding, you&#39;re still responsible to pay it. <h2>How Does a Charge-Off Work? </h2>When you miss a payment on a loan or credit card or have a bank account with a negative balance, the creditor or financial institution will attempt to collect the amount you owe. At some point, the creditor may determine the debt is uncollectible and decide to charge it off. This means the creditor has written off the remaining balance as a loss.  At this point, the creditor will report the account as “Charged Off” to the credit reporting agencies which will appear on your credit reports along with the account balance. If the charge-off is legitimate and you can&#39;t convince the creditor to remove it, a charge-off can remain on your credit reports for up to seven years after your first missed payment. Once a creditor has charged off a debt, they may decide to sell it to a debt buyer or transfer it to a debt collection agency for pennies on the dollar. If this happens, your account will be closed, interest will stop accruing on your balance, and your credit report will reflect that the account was &quot;Charged Off.&quot; However, you will still be liable for paying off the debt to the debt collection agency. Additionally, the collection agency may report a collection account for the same debt, further impacting your credit score. <h2>Will a Charge-Off Impact Your Credit Score? </h2>Your payment history is the most influential factor in your FICO credit score. Missing just one payment could have a significant negative impact on your credit score. If a debt balance remains unpaid long enough for the creditor to stop attempting to collect payment, the worsening delinquency and subsequent charge-off could have a long-term  and far reaching impact to your credit score.  For example, a low credit score and history of nonpayment may make it more difficult to get approved for credit in the future. It may also impact your ability to get approved for a residential lease or to qualify for lower interest rates on auto or homeowners insurance.  <h3>How Can You Repair a Charge-Off? </h3>The best way to repair a charge-off is to prevent it from happening. If you start missing payments, don&#39;t ignore the situation. Contact your lender and ask if there’s anything that can be done to help you avoid a charge-off situation. In the event your debt is charged off, as long as there is a balance, you’re still responsible for repayment which is why you should consider ways to pay off the debt as soon as possible to avoid having it go to collections. Even if you cannot pay off the debt in full, you may want to consider negotiating a payment settlement with the creditor for less than what you owe or, if necessary, having the debt discharged in bankruptcy.  In some cases, you may be able to negotiate with the lender to remove the charge-off from your credit report in exchange for full payment—a process known as “pay for delete.” Even if you can&#39;t get it removed, paying off the balance could potentially reduce the impact to your credit score.  If the creditor does sell the debt to a collection agency, you&#39;ll face more attempts to collect the amount you owe. Some debt collectors may even resort to lawsuits to force collection through a court order. <h3>How Can You Limit Charge-Off Damage? </h3>The timeframe for when a creditor decides to charge-off an account ranges from 120 to 180 days from your initial delinquency date. You&#39;ll typically receive letters and phone calls reminding you of the past-due payment, urging you to get caught up. Don&#39;t ignore the creditor—this is the best time to talk to the lender to see if you can avoid a charge-off. If you&#39;ve had an account charged off recently, contact the creditor as quickly as possible to verify the accuracy of the account details and look for opportunities to pay off some or all of the debt to avoid transfer to a collection account and further damage to your credit score. In some cases, a charge-off could be reported in error. If this happens, it could damage your credit score, so you should act quickly to dispute the negative item with the credit reporting agencies. As long as the dispute isn&#39;t frivolous, the credit bureaus are required to investigate it and remove or update the information if it&#39;s found to be innacurate.   To contact the credit bureaus:  <ul><li><a href="https://www.equifax.com/personal/credit-report-services/credit-dispute/">Equifax</a> </li><li><a href="https://www.experian.com/contact/personal-services-contacts.html">Experian</a> </li><li><a href="https://www.transunion.com/credit-disputes/dispute-your-credit">TransUnion</a> </li></ul>If the creditor decides to charge-off your account, it&#39;ll only report only to the credit reporting agencies that it normally reports to. For many lenders, it&#39;s all three, but some lenders may only report to one or two of the major credit bureaus.

{noun} An interest rate that remains the same for a set time, usually for the life of the loan.

An interest rate that remains the same for a set time, usually for the life of the loan.<h2>What Is a Fixed Interest Rate?</h2>A fixed interest rate is an interest rate that remains the same for a set time, usually for the life of the loan. With fixed-rate financing, borrowers can enjoy payment stability and avoid the risk of a variable interest rate—which may increase substantially over time, especially in rising interest rate environments.<h2>How Do Fixed Interest Rates Work?</h2>When you take out a loan with a fixed interest rate, your loan terms will define the fixed rate period.Generally, for financial products like fixed rate mortgages and personal loans, your interest rate will remain the same throughout your loan term, as will your monthly payment amounts.For financial products such as adjustable rate mortgages, the interest is variable, which means it can change periodically. Often, an adjustable rate mortgage (ARM) will have an initial period where the rate is fixed. After the fixed period, your interest rate may stay the same or it may adjust based on prevailing interest rates at the time.<h2>What Is the Difference Between Fixed and Variable Interest Rates?</h2>Fixed interest rates generally won’t change—either for the life of your loan or during a predetermined fixed period. In contrast, variable interest rates fluctuate based on market conditions and may change at any time.<h3>What Benefits Do Fixed Interest Rates Offer?</h3> Having a fixed rate loan offers several benefits for your finances.<ul><li>Financial Predictability. A fixed interest rate makes it easier to plan your finances since your monthly payments don’t fluctuate over the fixed period, usually the life of the loan. Such predictable payments can help you more easily manage your budget and alleviate stress.</li><li>Eliminate Interest Rate Risk. With a fixed interest rate, you don&#39;t have to worry if interest rates start to increase in a volatile economy. Compared to loans with variable rates, a fixed-rate loan with a lower interest rate could save you money in a rising interest rate environment.</li><li>Potentially Lower Borrowing Costs. With fixed-rate loans, you’ll know your total borrowing costs—including interest and fees—before you sign your loan documents. With variable-rate loans, it’s difficult to calculate your total borrowing costs since your interest rate may change substantially over time.</li></ul><h3>What Are the Drawbacks to Fixed Interest Rates?</h3>While a fixed interest rate can help you plan your finances for the long term, there are a few drawbacks to consider.<ul><li>Potentially Higher Rates. Adjustable-rate financial products often have lower interest rates for an initial, introductory fixed period which may temporarily lower your cost to borrow. Fixed-rate products don’t offer such “teaser” rates.</li><li>Risk in Decreasing Interest Rate Environments. If interest rates start going down, you may end up paying more to borrow on a higher interest rate than if you took out a new loan.</li><li>Refinancing Costs. Even if you decide to refinance to get a lower rate, refinancing costs may outweigh the savings you may realize, and the process can be time-consuming. It’s important to compare the total cost of borrowing of your existing versus a potentially new loan before making a decision.</li></ul><h2>What Can You Do to Get a Good Fixed Interest Rate?</h2>Generally, having a high credit score and a demonstrated track record of responsible debt management can help you land a lower fixed interest rate. In contrast, if you have a low credit score and a spotty history of on-time payments, the lender may view you as a higher-risk borrower and may not offer you the best fixed interest rate they have available.<h2>Can You Switch from a Variable Interest Rate to a Fixed Interest Rate?</h2>In most cases, you can&#39;t switch from a variable to a fixed interest rate on an existing loan. While you may be able to refinance your loan—either with your current lender or a new one—and move to a fixed-rate loan that way, it’s important to consider how well you would be able to cope with economic uncertainty. A low variable rates may be tempting initially, but should economic conditions sour and rates begin to rise rapidly, it may be difficult to find a good fixed rate when you want one. Or you may experience an unexpected obstacle, like job loss, that could make refinancing into a fixed interest rate loan difficult.<h3>Are Credit Card Interest Rates Fixed?</h3>Generally, credit card interest rates are variable, not fixed.<h3>Are Student Loan Interest Rates Fixed?</h3>It depends on the type of student loan. Student loans like Perkins Loans and PLUS Loans have fixed interest rates. Many other direct federal student loans—both subsidized and unsubsidized—have fixed rates as well.

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