LightStream Personal Loan Review
LightStream is an online lender designed to accommodate and reward borrowers with excellent credit histories. The application is quick, the interest rate can be exceptionally low, and in some cases, you can receive your LightStream loan on the same day you apply.
What we like:
Beat any qualifying rate
|Rates (APR)||5.34% – 16.99%|
|Loan Terms||2 – 7 years|
|Loan Amounts||$5,000 – $100,000|
|Fees||Origination fee: None|
Prepayment penalty: None
Application fee: None
Online lending continues to be a growing force in the financial industry, and many traditional banks are adapting to this emerging consumer preference. Such is the case with SunTrust Bank, which recently launched LightStream, their online consumer lending division.
As a lender, LightStream aims to reward borrowers with good credit through a simplified borrowing process and highly competitive rates. Although LightStream doesn’t have a product officially referred to as a personal loan, they do offer lending opportunities to cover a wide range of expenses, including those related to auto purchases, home improvement and repair, debt consolidation, medical expenses, weddings, vacations, and educational refinancing efforts. Instead of a blanket interest rate for a single loan product, LightStream bases rates, in part, on the purpose of the loan.
In this review:
- How to Get a LightStream Personal Loan
- Rates, Fees, & Other Basic Info
- The Benefits of LightStream Loans
- The Downsides
Getting a LightStream Personal Loan
To apply for a LightStream loan, consumers can visit the LightStream website and begin the online application process.
- To complete this application, borrowers must first specify the primary purpose for the loan (e.g., wedding expenses, home repairs, auto loan, debt consolidation, etc.), the total loan amount, and the desired loan term in months.
- Additionally, applicants must select a repayment method by selecting either AutoPay — which will result in an automatic monthly payment — or Invoice — which require the borrower to make manual monthly payments. Selecting Invoice will automatically increase the interest rate by .50 percentage points.
- Once the loan application is submitted, applicants can typically expect a quick, same-day response if they apply within normal business hours; otherwise, applicants may not receive a response until the following business day.
- If approved, applicants can e-sign their loan agreement and set up their funding preferences (e.g., banking info, funding date, etc.). In some cases, if the loan is approved and the agreement is reviewed and signed by 2:30 p.m. EST, funds can be available on the same day. Funds can either be deposited via ACH or wire transfer.
As a company that specializes in lending partnerships with consumers who have very good or excellent credit scores, eligibility factors are a bit more stringent. With that in mind, Lightstream defines excellent credit as having little to no delinquencies in your payment history; evidence of the ability to save through the presence of liquid assets like stocks, bonds, retirement savings, and manageable revolving debt; stable and sufficient income when paired with your loan request; and a variety of financial accounts, like credit cards, personal loans, and mortgages, that are all in good standing.
LightStream Loan Rates, Terms, Fees & Limits
Generally speaking, LightStream currently offers loan rates between 3.34% and 16.99%, with loan terms that range from 24 to 144 months. However, rates and terms are based on the purpose of the loan, the loan amount, and the desired loan term, as well as the applicant’s credit history, income, and other financial background information.
For example, a home improvement loan for $25,000 will likely carry an interest rate between 6.59% and 13.04% with loan terms as long as 144 months.
Typically, the longer the repayment plan, the higher the interest rate. Additionally, rates are typically lower for loans between $10,000 and $49,000, with loans below or exceeding that range frequently carrying higher interest rates.
Sound confusing? It can be, but fortunately, LightStream’s website is extremely easy to use and potential borrowers can use the rate chart to determine how different lending scenarios impact the rate and terms.
One thing borrowers will want to consider is the impact that AutoPay has on their rates. To receive the best rates, borrowers must agree, at the time of application, to a monthly autopay obligation. Failure to do so will increase rates by .50 percentage points across the board.
The Benefits of LightStream Loans
One of the most appealing aspects of LightStream is the low interest rates, which can potentially save borrowers a good amount of money in the long run. LightStream offers rates as low as 5.34% for home improvement or general loans, which is much lower than many of its competitors.
LightStream is also an excellent option for borrowers hoping to avoid fees. The unsecured loans from LightStream come with little to no fees, such as late payment fees, prepayment penalties, and origination fees.
Additionally, borrowers who need cash quickly can potentially secure the funds on the same day they apply, a real plus for unexpected, emergency expenses.
Aside from offering low rates and quick funding, LightStream offers a few other unique perks that make it attractive to potential customers. One of those perks is the Rate Beat Program, which offers approved borrowers a .10 percentage point deduction if the annual percentage rate presented by another lender beats the rate offered by LightStream.
Additionally, LightStream also offers a Loan Experience Guarantee in case a customer is not satisfied with their loan experience and notifies LightStream within 30 days of their loan origination. If this is the case, LightStream will send the customer a questionnaire, and once completed and returned, the customer will receive $100.
The Downsides of a LightStream Loan
With rates that are, in many cases, much lower than the competition, it’s tempting to believe that this lender has few, if any, downfalls. However, one thing to keep in mind is that the best rates are, as is often the case, typically reserved for prime borrowers with outstanding credit profiles and years of credit history. Since LightStream is specifically designed to accommodate the needs of borrowers with excellent credit, it may be hard for some borrowers, even those with good credit, to get approved for the lowest advertised rates.
Finally, though many online lenders utilize soft credit inquiries to help potential customers obtain rate quotes, LightStream does not follow this policy. They do offer a comprehensive rate scale, but you won’t know if you’re eligible for a loan or competitive rates until you apply and agree to a hard credit inquiry, which can affect your credit score.
If you have excellent credit and are looking for a personal loan, then a trip to LightStream’s website is definitely worth your time. The application process is quick and, in some cases, funds can be available on the same business day you apply. That said, if you have average credit or good credit with some financial blemishes (e.g., delinquencies, inconsistent income, etc.), LightStream may not be for you.
Your best bet is to obtain your credit report, visit the site, review the rates and terms specific to your loan purpose, and compare potential rates with those offered by similar online lenders, your bank, and your local credit union.
*Payment example: Monthly payments for a $10,000 loan at 9.34% APR with a term of 3 years would result in 36 monthly payments of $319.58. LightStream disclosures here.
Author: Jennifer Lobb
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