There are places to get loans even if your credit score has fallen off the cliff. You may need that extra money for a medical or housing emergency despite the fact you have other financial obligations or are not making a top salary.
NetCredit is a lender that caters to clients with low credit ratings. That low credit score will cause you to pay a higher interest rate, though, because the lender feels you are at higher risk of not meeting your payments.
Plus, if you take out a loan or open a line of credit from NetCredit and make your payments on time, you will likely see your credit rating climb. We review NetCredit here so you can decide if this lender is right for you.
What Is NetCredit?
NetCredit is an online lender, offering unsecured personal loans (and lines of credit) through their partnership with Republic Bank & Trust Company and Transportation Alliance Bank, Inc. Available in 37 states, NetCredit believes that borrowers are more than just their credit score and claims to use a broader financial summary of borrowers’ finances to create a loan plan that works for borrowers — even those with a poor credit history.
While a NetCredit personal loan is better than a payday loan, NetCredit’s personal loans have high APRs. Those APRs range from 34% to 155% depending on your state and that can make paying back the loan difficult.
We like that NetCredit’s loan term is decently flexible with repayment terms ranging from 6 to 60 months and that they have a fast deposit time. But with such high interest rates, NetCredit won’t be a good choice for most.
Personal Loans vs. Lines of Credit
Before we dive into NetCredit’s loans, here’s a quick review of NetCredit’s two services: personal loans and lines of credit.
Unlike a personal loan that is received as a lump sum, NetCredit’s open-end line of credit works as a flexible, revolving account. Basically, you can access the money up to the borrowing limit and then once repaid, you can access it up to that limit again.
NetCredit offers lines of credit with varying maximums and minimums depending on your state, but mostly an average of $500 to $7,500. To find your state’s limitations, check out NetCredit’s Rates and Terms.
Lines of credit are most often used to supplement income if borrowers run into a cash shortage. While helpful, most people use NetCredit for large upfront expenses like to consolidate debt or cover a large home expense, so a personal loan is more helpful.
Accordingly, this review focuses on NetCredit personal loans, but if you’re interested in understanding lines of credit better, check out our full review of what a line of credit is and how it works.
Things to Know About NetCredit Personal Loans
NetCredit can seem like a lifesaver for people with poor or nonexistent credit looking for a loan, but it’s important to understand what you’re really paying for with a NetCredit loan and how much it’s going to actually cost you.
Below, we outline key points to consider before you sign up for a NetCredit personal loan.
NetCredit Personal Loans
High interest rates
Flexible loan terms
Quick approval time
Features Covered in NetCredit Review
There are a number of features of a NetCredit loan or line of credit that you’ll want to understand before (electronically) signing on the dotted line. We go into detail about them here so you can decide if NetCredit is right for you.
Keep in mind that one of its top selling points is that it works with clients with bad credit and there is no penalty for paying off a loan early.
NetCredit mostly offers personal loans from $1,000 to $10,000, but in some states actually offers loans as little as $500. You can look up your personal offerings by state on NetCredit’s Rates and Terms.
Unlike some online lenders that have specific, unbendable loan timelines, NetCredit’s loan terms range from six to 60 months. If you qualify for a NetCredit loan, it’ll allow you to pick your loan term amount. Just remember that while a long loan term does reduce monthly payments, it ultimately costs you more interest over time.
NetCredit follows state lending laws that limit interest rates, so their rates vary depending on location and can range from 34% to 155% APR. Where you fall in this range depends on your state of residence, your credit history, your monthly payment expectation, and the amount you plan to borrow.
These high APRs situate NetCredit somewhere in between other online lenders that often have lower APRs and payday loans that have even higher APRs. While we’re grateful NetCredit’s APR is a (slightly) more affordable option than payday loans, NetCredit’s high rates can really tank your finances.
For example, say you borrow $1,000 at 87% APR with a three-year repayment period. Here are the totals you’ll end up actually paying for that $1,000 loan:
Monthly payment: $78.85
Total Interest paid: $1,838.44
Loan Cost: $2,838.44
The low monthly payment can initially seem pretty enticing, but you’ll end up paying almost three times the original loan thanks to the high interest rate. Basically, this interest can make getting yourself out of debt pretty difficult.
Fees and Penalties
NetCredit charges several fees and penalties depending on where you live. For example, in most states, NetCredit charges a late payment fee of $25 and an origination fee.
Thanks to NetCredit’s ClearCost for Me program, your specific fees should be explained up front before you sign up so that the extra costs for the personal loan will be clear — just make sure to read all the loan details.
One thing we do like about NetCredit’s fees is that they do not have a prepayment penalty. They don’t penalize you for paying off your loan early which we suggest you do as soon as possible to avoid the effects of NetCredit’s astronomical interest rates.
NetCredit serves 37 states: Alabama, Alaska, Arizona, Arkansas, California, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin and Wyoming.
How to Get Started With NetCredit
If you’re moving forward with a NetCredit personal loan, the requirements to apply for a NetCredit loan are minimal. To apply, borrowers must:
Be 18 years or older (19 in Alabama and Delaware and 21 in Mississippi)
Have a valid personal checking account
Have an active email address
Have a verifiable source of income
Once you’ve applied, you can be approved for a loan in as little as one business day. NetCredit claims to determine your approval based on a broader financial picture, not just your credit score which often means people with less-than-perfect-credit scores still stand a chance at approval.
If approved, you’ll then fill out a form explaining the loan’s purpose and providing employment and income details, desired loan amount, repayment terms, and your social security number, and NetCredit will create the final loan terms for you to look over and sign.
Should I Get a Loan With NetCredit?
The short answer is, not if you can avoid it. While NetCredit is a good service as a last resort, it should always be treated as such. A personal loan from NetCredit comes with a high APR, which makes the cost of borrowing substantial. If you can afford to, we suggest you look elsewhere.
If you do decide to go with NetCredit, we recommend you read the loan details carefully so that you understand exactly what you’re paying and then try to pay it off as early as possible!
Alternatives to NetCredit
If you’re wary of NetCredit’s high APRs like we are, check out a few other options to consider to meet your financial needs.
Other Personal Loan Lenders
These days there are a lot of other lenders that offer much lower APRs than NetCredit. Some even advertise similar promises for fair credit scores. For example, Upstart claims to take a look at more than just your credit score and has more reasonable APRs of 6.5% to 35.99%. While it does require a credit score of at least 300, the lower APRs are well worth it if you can qualify. If you’re interested, check out our UpStart review.
Secured loans–like a HELOC–are another option to help with your cash flow problem. These types of loans have collateral behind them so they’re less risky for lenders which normally means lower interest rates for the borrowers. You are of course risking whatever you use as collateral, but the lower interest rates can make paying off the loan much easier.
Balance Transfer Card
If you’re thinking about taking out a personal loan for debt consolidation, you might think about a balance transfer card. A balance transfer card is like any other normal credit card except it also allows you to move a balance from one card to another. Most often what this does is buy you time, allowing you to move your balance to a card that might have a lower APR or a low introductory rate. It’s not a permanent solution to debt, but can be a big help.
Renegotiate Credit Card Debt
You can also try to negotiate with your creditors. Some things you might think about is asking for a forbearance or hardship plan, asking the lender to erase your late fees, or seeking out a debt management program.We suggest you check out the Negotiating Credit Card Debt page to help flush out your options.
Pros and Cons of NetCredit
Now that you’ve got the basics, here are the pros and cons of how we see NetCredit stack up as a whole.
Approval possible on the same business day
Loan options for people with bad credit
Soft credit check available
Opportunity to build credit
Origination fees and late fees
Not available in all states
Know What You’re Getting Into With a NetCredit Loan
First, we admire NetCredit’s quick turnaround on approvals and deposits. NetCredit claims they can have you approved and money in hand the same day. While that’s possible with other online lenders, some banks will take as long as five business days to disburse your money, so if you’re in a bind, NetCredit can help you quickly.
We also like that NetCredit offers a soft credit check called MyScoreSaver that allows you to understand your personalized loan terms without a hard credit pull.
Finally, we like that NetCredit reports to the major credit bureaus. So as you pay off your loan on time, you can build your credit. There are other less expensive ways to build your credit, but if you’re going to be using NetCredit anyway, this is a nice perk.
Despite all these positives, we have to emphasize NetCredit’s high APRs and fees. NetCredit’s interest rates range from 34% to 155% — and can make it difficult to get out of a cycle of debt.
Plus, NetCredit has a $25 late fee and 1% to 5% origination fee depending on your location. While these fees aren’t exorbitant, there are some online lenders that waive these fees completely.
Frequently Asked Questions (FAQs) About NetCredit
If you’re still wondering about NetCredit, check out some of the most frequently asked questions to help you figure out if NetCredit is right for you.
NetCredit is a legitimate online lender working in partnership with the Republic Bank & Trust Company and Transportation Alliance Bank, Inc as an option for people with bad credit scores seeking a quick money source.
NetCredit’s history has not been without its problems however. In 2018, the Commonwealth of Virginia sued NetCredit for misleading borrowers and working in Virginia illegally. Now, NetCredit promises upfront pricing, but they still do have quite a few complaints filed at the Consumer Financial Protection Bureau each year.
So the straight-forward answer is that NetCredit is legitimate, but we suggest you understand the terms of your loan before you sign.
NetCredit advertises same-day approval. The approval process can sometimes take up to three business days with the money depositing one business day after the loan is approved. This deposit time is quick and one of the reasons NetCredit can help if you’re in a bind.
NetCredit’s APRs range depending on where you live and your financial history, but can be anywhere from 34% to 155%. You can look up your state’s specific range on NetCredit’s Rates and Terms.
NetCredit isn’t a straight-forward predatory lender, but they do have some predatory lender-like practices, namely high interest rates.
Enova International, NetCredit’s parent company, has been put on the NCLC’s High-Cost Rent-a-Bank Loan Watch List for suspicious activities regarding possibly skirting state laws that are meant to protect borrowers.
Even the NetCredit website itself references that fact that there may be lower APRs available on the market. So no, NetCredit is not on some official predatory lender list, but it is worth watching and being careful what you sign up for.
Contributor Whitney Hansen writes for The Penny Hoarder on personal finance topics including banking and investing.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.