What we like:
Loans with deferred interest
|Rates (APR)||4.99% – 23.99%|
|Loan Terms||Deferred-interest loans: Promotional period followed by 7 years.|
Reduced-rate loans: 5, 7, 8, 10 or 12 years.
|Loan Amounts||Up to $65,000|
|Fees||Activation fee: $39 at time of first purchase|
Origination fee: None
Prepayment penalty: None
Late fee: None
Whether you’re working with a contractor or going at it alone, home improvement costs can quickly add up. This can be problematic if you need to make multiple purchases from various merchants or if the contractor you decide to work with doesn’t offer their own financing option. To address that need, GreenSky offers a quick-approval loan you can use for home improvement.
A GreenSky loan offers borrowers six months to make home improvement-related purchases from merchants or retailers. Once the six months is up or the credit limit is reached, the card expires and borrowers are required to make fixed monthly installment payments for the duration of the loan term.
Getting a Loan Through GreenSky
Residents of the U.S. who are 18 years or older (19 years if you live in Alabama or Nebraska) who want to apply for a loan through GreenSky will need to fill out an online application or work with a representative over the phone.
The application process is fairly straightforward, with a one-page application form, which includes a valid Social Security number, gross annual income, the loan amount requested, and the desired term.
Those applying will also have the opportunity to add a co-applicant to the applications, which can increase the chances of approval and decrease the APR.
For most creditors, creditworthiness typically is based on a variety of factors including income, debt-to-income ratio, and your credit score. And though it’s assumed that these requirements remain the same, GreenSky doesn’t specify what factors are most likely to earn approval. However, a recent Wall Street Journal article about the company suggests that they target consumers with credit scores around 760, potentially making their product out of reach for borrowers who have poor credit.
Once an applicant is approved, GreenSky will ship the payment card out, and the applicant can expect to have the card in hand in about 10 days.
Generally speaking, GreenSky’s loan is very similar to a line of credit, in so far as you are approved for a certain amount but don’t have to use that amount – you’ll only be billed for what you use. Borrowers who are deemed creditworthy can receive up to $55,000 in home improvement loans but are not obligated to spend the entire amount awarded through the payment card.
Once approved and payments begin, borrowers can expect to pay anywhere from 3.99% to 23.99% interest. In some cases, these rates are lower than those offered by similar companies like Avant (9.95% to 35.99%).
It should be noted that the borrowed amount may not be the amount originally requested, as the loan program operates similarly to a line of credit, in which the borrower is only responsible for paying the total spent. Any remaining funds that are not used during the six-month period will expire.
Home improvements can be made by using a variety of financing options, including home equity loans. But if you don’t have enough equity in your home, or if you aren’t eligible for other home improvement financing options, then GreenSky’s Program Loan might be a viable option for you, particularly if you have strong credit or a creditworthy cosigner.
Additionally, some borrowers may find the payment card to be an attractive feature, as it allows them to apply for a specific loan amount but doesn’t require them to use that amount. Another benefit of the payment card is the six-month window, which enables users to purchase goods and services, specific to home improvement, as the project progresses or requirements shift over the allotted time.
GreenSky seems to have its share of unsatisfied customers, as many review sites, including Yelp, indicate issues with customer service and payments, specifically failed automated payments. Although it’s not always best to judge an organization based on a bad review or two, the consistency with which certain issues, like those mentioned, are reported might indicate a red flag. As such, borrowers considering GreenSky might want to consider those reviews and read any fine print that comes along with the loan agreement.
The Bottom Line
If you’re working with a contractor who doesn’t offer financing, or you’re doing your own home improvements, then GreenSky might be a good fit. However, be sure to research this lender, review alternative home improvement lending options, and do your homework before committing to make sure it’s the best option for you.3.65 GreenSky Home Improvement Personal Loans
Author: Jeff Gitlen
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