Updated October 5, 2016
Best Egg is a personal loan company trying to make the borrowing process fast and simple for people looking to refinance credit cards or who need funds for personal use. In this review, we will examine the costs and loan application process for applying for a loan through Best Egg. We encourage everyone to shop around for the best rate, and you can find the best personal loans here.
Best Egg offers unsecured personal loans. These are installment loans with a fixed monthly payment for the life of the loan, but like a credit card, are not secured with property such as a car or home. Meaning you don’t have to provide collateral in order to receive a loan.
The company offers loans up to $35,000 with up to a 5 year term. Your interest rate is determined by your credit history and can range from 5.99%-29.99% with an origination fee ranging from 0.99%-5.99%.
The loans are originated through Cross River Bank, which is located in New Jersey. You do not need to be a New Jersey resident to apply for a loan.
The best features of Best Egg are the simple terms and competitive interest rates for borrowers with a strong, positive credit history. Beyond the interest charge and origination fee, there are virtually no fees.
The company charges $15 for a late payment and $15 for a returned payment, which is lower than the typical $25 fee. There are no application fees and the origination fee is deducted from your starting loan proceeds, so there is no out-of-pocket cost to get started. However, this does mean you need to factor in the origination fee when you request the amount you need for a loan.
There are no pre-payment fees, so if you are able to make extra payments or pay off your entire balance early, you will not be charged any additional fees.
Best Egg only offers payback periods of 3 years or 5 years. If you want a shorter loan payback period than 2 years or a longer payback period than 5 years, they will not meet your needs.
As a borrower, your interest rate is based on your credit score and is locked in at the time of origination. While some borrowers may qualify for a 5.99% interest rate and 1% origination fee, they do not disclose the requirements to qualify for its best rates.
Even at 1%, the origination fee is certainly a negative considering other personal loans like SoFi offer no origination fee and no pre-payment penalty.
The highest interest rates are nearly 30% with a 6% origination fee. These rates are comparable to the worst credit card interest rates and may not offer you any benefit compared to using a credit card, which has no origination fee.
At the worst interest rates, this is still much better than typical payday loans or auto title loans, but you may have lower cost options available including lending platforms like Avant.
What Do I Need to Qualify?
These loans are approved based on your credit history. If you qualify, you are assigned a letter grade which corresponds to an interest rate between 5.99% and 29.99%. Current rates are available here.
The application process requires giving your email, and Best Egg uses a “soft pull” on your credit report to determine whether you qualify and find out your interest rate. A soft pull does not impact your credit score.
When you apply, you will need your Social Security number and current contact information handy for the application process, which is typical for any loan application.
Who is this Best For?
If you have credit card debt with a high interest rate, refinancing with Best Egg could save you a lot of money on interest over the life your debt. If you can lower your interest rate and set a fixed payback period compared to the open ended time frame on a revolving credit account, you could easily save thousands of dollars.
The site suggests using loan proceeds to help pay for a move, vacation, home improvement, debt consolidation, home purchase, or vehicle purchase. This product may save you money compared to credit cards, but it is a best practice to avoid debt where possible, particularly for optional luxury purchases like a vacation.
What About the Fine Print?
One of the biggest benefits of using Best Egg compared to competitors is that loans with Best Egg do not come with a mountain of fine print. There is almost no fine print actually.
You do not pay unless you get a loan and the only fees you will encounter are the origination fee and from late payments and rejected payments from your bank account. That is really it. There is no catch.
Unless you’re in Massachusetts, then the fine print states that your minimum loan amount is $6,000.
Shop for Multiple Offers at Once with LendingTree
[Disclosure: LendingTree is the parent company of MagnifyMoney.]Every personal loan company has its own unique underwriting and pricing rules. That means you can get very different loans offers from different lenders – regardless of your credit score. We recommend starting your search with LendingTree. With just one online form, dozens of lenders will compete for your business. LendingTree uses a soft credit pull – which means you can get multiple rates from multiple lenders without hurting your score.
People with excellent credit can find low rates (even below 6%) because lenders like SoFi participate in the LendingTree program. But don’t worry if you don’t have excellent credit – there are many lenders participating in this program who accept people with less than perfect credit. It should take less than five minutes to see if you qualify. And most lenders can fund the loan quickly – and directly to your banking account.
Always Shop Around
It doesn’t hurt your score to see your offer with Best Egg, but there are other personal loan providers who also offer a soft pull. Don’t just take the first offer you receive. You should always be shopping around for the best possible rate, especially because lenders offering a soft pull don’t harm your credit score.