Rise Installment Loans: 2022 Review – NerdWallet

Rise Credit is an online lender operated by Texas-based lending company Elevate. Its installment loans are designed for bad-credit borrowers and those who can’t get a loan from a traditional bank or online lender.

This Post: Rise Installment Loans: 2022 Review – NerdWallet

Interest rates on Rise loans can rival those of payday lenders, with maximum annual percentage rates reaching 299% in some states. High rates make these loans an expensive way to get cash in an emergency. NerdWallet recommends avoiding loans with rates above 36%, unless you’ve ruled out all the alternatives.

Rise Credit rates, fees and terms

Rise Credit’s rates, fees and repayment terms vary by state, but here’s what the lender offers across all states where it operates.

APR range

50%-299%.

Loan amount

$300-$5,000.

Fees

No late, prepayment or origination fees.

Repayment terms

4-26 months.

States where available

AK, AL, AZ, DE, FL, GA, HI, ID, IN, KS, KY, LA, MI, MN, MO, MS, MT, NE, NM, NV, OH, OK, OR, SC, TN, TX, UT, WA, WI and WY.

How to qualify for a Rise loan

To make a loan decision, Rise uses information from two of the three major credit bureaus (Experian and TransUnion) as well as alternative credit bureaus such as Clarity Services, Teletrack and FactorTrust. This means borrowers with thin or no credit history may not qualify for a Rise loan. The lender doesn’t disclose a minimum credit score requirement.

To apply for a Rise loan, you must:

• Be at least 18 years old.

• Live in a state where the lender makes loans.

• Have a Social Security number.

• Have a job or regular source of income.

• Have an active checking account.

• Have an email address.

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Rise Credit pros and cons

A Rise Credit loan is an option for borrowers who don’t qualify for a loan with a lower interest rate. Before you borrow, consider the pros and cons.

Pros

Borrowers with low credit scores may qualify. A low credit score may not keep you from getting a Rise loan. Because a lender makes up for the risk of lending to bad-credit borrowers by charging high interest rates, this kind of loan is a last resort in an emergency.

Fast funding. The lender makes application decisions in “a matter of seconds,” according to its website. Once approved, Rise says it can fund a loan as early as the next business day.

Free credit score access. Rise borrowers can monitor their credit scores through the lender’s Credit Score Plus feature. Free credit score monitoring is offered through many banks and credit card issuers, and it can show you how loan payments affect your score.

Soft credit check to pre-qualify. Rise allows borrowers to pre-qualify to preview their potential loan rate, amount and repayment term. Though it isn’t clear from the application, a customer service representative says entering your information won’t affect your credit score unless you accept the loan offer. Many online lenders offer pre-qualification, so it’s smart to check offers from multiple lenders to find the least expensive loan before you apply.

Cons

High interest rates. Rise’s annual percentage rates can reach 299% in some states and 149% in others. Most consumer advocates say an affordable loan should not have an APR above 36% — much lower than even Rise’s minimum rates in most states. Some lenders offer installment loans with rates below 36% to consumers with low scores, though the lowest scores (usually below 500 FICO) may not qualify.

Refinancing option may do more harm than good. The lender allows borrowers to refinance an existing loan to get more money, but it could put you deeper in debt. Using a larger or longer-term loan to pay off an existing loan — even if it has a lower APR — may require more monthly payments and cost more in interest than the initial loan. Consider this offer carefully and decide whether you’ll actually save money before refinancing.

No option to choose your payment schedule. Borrowers can’t permanently change their repayment schedule through Rise, but they can extend a payment for seven days, according to the lender’s website. Many lenders allow borrowers to permanently change the payment due date to accommodate a new job and pay schedule or additional bills.

Should you get a Rise Credit loan?

This type of financing is only designed for borrowers who can’t get a loan elsewhere, so consider it as a last resort in an emergency. It can be easy to fall behind on payments toward high-interest loans. Because Rise reports to Experian and TransUnion, a missed payment may hurt your credit while an on-time payment may help it.

Depending on your goal, you may have better options. Rise isn’t a good idea if:

• Your main goal is to build credit: Getting a secured credit card or credit-builder loan, or paying off existing debt, are faster and cheaper ways to build credit. Find other ways to build credit.

• You can get cash elsewhere: NerdWallet recommends exhausting cheaper alternatives first, including local charities and nonprofits — even in an emergency.

How Rise loans compare

SeedFi offers a personal loan and credit-builder loan in one. Borrowers get part of the funds from the loan immediately, and the rest goes into a savings account. Once you repay the loan, you can access the savings account. These loans are available to bad-credit borrowers, and APRs are capped at 29.99%.

OppLoans’ APRs are comparable with — or in some cases lower than — Rise APRs. Unlike Rise, OppLoans payments are reported to all three major credit bureaus and borrowers can also change their OppLoans payment date.

Oportun focuses on helping those with no credit history establish it. Oportun caps APRs at 36% and is a certified community development financial institution, meaning its primary mission must be promoting community development.

Lawsuit against Rise

Rise offers loans with APRs above some state-mandated maximums. In Ohio, for example, short-term loans can’t have an APR above 28%, but Rise offers loans with APRs between 99% and 149%.

When NerdWallet asked about the discrepancy in 2020, a spokesman said Elevate adheres to “applicable state and federal banking laws” in an emailed statement. Utah-based FinWise Bank and CCBank originate and fund Rise loans in most of the states where Rise operates. Utah doesn’t impose a maximum APR.

In 2020, Washington, D.C.’s attorney general filed a lawsuit against Elevate, alleging Rise and Elastic — another lender Elevate owns — lent money at interest rates above the district’s mandated maximum. The lawsuit also alleges that the lenders’ direct mail offers misled consumers, and they didn’t accurately communicate the loans’ interest rates.

Elevate settled the lawsuit in 2022 and agreed to pay $3.3 million in refunds to local customers and $450,000 to Washington, D.C.

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Rise loan example

Some installment loans are difficult to repay because of their long repayment terms. Rise loans can have lower APRs than payday loans, but they are still an expensive option. A $2,000 loan with a repayment term of 24 months at an APR of 130% would carry:

• Monthly payments: $237.

• Total interest: $3,681

• Total amount due: $5,681.

Alternatives to Rise

Here are some alternatives that may be cheaper than borrowing.

For help meeting basic needs: Seek assistance from local nonprofits, charities and religious organizations. They can help you get food, clothing and access to transportation for job interviews.

For help with rent or utilities: Contact your utility company, landlord or mortgage issuer for help deferring a payment. If you need long-term help, consider seeking other housing, or contact a housing counselor.

To pay medical bills: Learn about ways to cover medical costs, including payment plans.

To cover other one-time emergency expenses: 

• Ask a friend or family member for a loan, or form a lending circle to borrow from those you trust without accruing interest.

• Ask your employer for a paycheck advance, or use a loan app to borrow against your next paycheck.

• Get a payday alternative loan or a small personal loan from a credit union. You have to be a member to use this option, but it’s one of the most affordable ways to pay for an emergency.

• Try other ways to make money. You need some extra time to make this option work.

Before you take out a Rise loan

After considering alternatives and weighing the costs, you may decide that taking a Rise loan is your best option. In that case, do what you can to carve out room in your budget to pay the loan off as quickly as possible. For most people, this loan is too expensive to be a long-term or repeat solution.

How to get a Rise Credit loan

Here are the steps to get a Rise Credit loan:

1. Enter your first and last name, email address and state on the lender’s website, then select “Get Started.”

2. Enter the rest of your information, including your phone number and Social Security number and select “Continue.”

3. Once you provide additional information, like your income and address, the lender will do a soft credit pull and show you a potential loan offer. Depending on your state, you may be able to change the loan amount or repayment term.

4. If you accept the loan offer, the lender will do a hard credit pull and finalize your approval. Loans are typically funded the next business day.

If you got an offer in the mail, the application process may be shorter because the lender may have already done a soft credit pull. In that case, you’ll enter some personal information and the invitation code and accept the offer.