Updated December 11, 2015
LightStream is the online lending division of SunTrust Bank. If you’re not a member of SunTrust Bank, you can still apply for a loan with LightStream*.
While LightStream is bank owned, its approval process is similar to other online lenders: straightforward and quick. If you get all of your documents in on time, you might actually be eligible for same-day funding.
LightStream is so sure you’ll have an easy time applying for a loan, it will give you $100 if you don’t have a satisfactory experience.
With that kind of guarantee, it’s worth taking a look at whatLightStream’s personal loan has to offer.
Personal Loan Details
LightStream personal loans are offered on terms of 2 to 7 years, and you can borrow between $5,000 and $100,000.
It also offers low rates – its APR range is 3.09% - 17.49%, although the website says auto loans start as low as 2.49%, and home improvement loans start as low as 4.99%.
What’s different about LightStream is your intended use of the loan changes the terms available (including the APR). Normally, online personal loan lenders ask you why you’re taking out the loan, but your answer doesn’t affect your rates.
LightStream uses the following payment example on its website: if you borrow $20,000 at a 2.5% APR for 5 years, your monthly payment will be $354.95.
The Pros and Cons
LightStream offers very competitive rates and terms, and its max loan amount and term are higher than what other lenders have to offer. Typically, personal loans max out at 5 years and you can only borrow between $25,000 - $35,000.
If you have a large home improvement project you want to tackle, or a lot of debt to consolidate, LightStream could be a great option for you.
However, you’re locked into using the funds for the purpose you specify on the application, and different terms and rates apply for each. For example, the 2.29% APR offered on auto loans isn’t offered for wedding loans.
You’ll also need good or excellent credit to qualify for a loan with LightStream. It wants to see a strong, positive credit history with multiple lines open. You’ll have a better chance at being approved if your credit score is over 680.
What You Need to Qualify
To qualify for the best rates, you’ll need to have “excellent credit,” which is defined by LightStream as having 5 or more years of significant credit history, an excellent payment history with no delinquencies, money saved up, and stable and sufficient income. Your credit lines should also have some variation.
LightStream defines “good credit” as just a few steps below that, with only several years of significant credit history.
A credit score of 720 is recommended, and you shouldn’t have any recent late payments or delinquencies on your credit.
Application Process and Documents Needed to Apply
The application process is fairly straightforward, and you don’t need any documents to apply. However, if you proceed with the loan agreement, you might be asked to supply basic proof of income and residency.
There’s no pre-approval process, and you must apply online. There are three stages of the application:
- Providing the terms of the loan you would like
- Entering your personal information (including address and employment information)
- Entering security information.
Note that LightStream uses a hard credit inquiry when submitting your application.
You can receive same-day funding on business days if you complete all the necessary steps and submit your final documents by 2:30pm EST.
According to the application page, you’ll need a valid Visa or Mastercard credit card for verification purposes before you can receive your funds.
Who Benefits the Most from a Personal Loan with LightStream?
Those with great credit will benefit the most as they’ll have the highest chance of getting approved.
Unfortunately, the one downside to note is LightStream is unable to refinance student loans, unlike other personal lenders. If you’re looking to do that, you’ll need to apply with another lender. There are many personal loans out there without that restriction.
LightStream pushes its home improvement loans on its social media platforms and website, and for good reason. If you’re looking to do a major overhaul on your home, like an addition or kitchen renovation, you might need more than the $35,000 other lenders offer.
Overall, potential borrowers are more likely to be approved if they’ve been responsible with their use of credit in the past, and with how they handle money in their everyday lives.
The Fine Print
Is it hard to believe that there’s no fine print with LightStream’s personal loan? Its website states there are no fees of any kind that will be incurred.
Further inquiry yielded the same results, as a customer service representative clarified, “There are no fees (application fee, late fee, prepayment penalty) associated with our loans.”
What happens if you’re late on a payment? “You must pay the interest accrued on a per diem basis until you make the payment.”
Most other lenders charge around $15 any time you miss a payment or a payment fails to go through, so this is good to hear.
LightStream’s website is fairly straightforward and easy to use, but there were a few missing elements we had to check up on. It doesn’t explicitly state whether or not a hard or soft credit check is used, and it doesn’t go over eligibility requirements.
At first glance, it might not look like you can call LightStream. If you go to its “Questions” page, only an email form is listed. However, if you’re filling out the application, a “Contact Us” link appears at the top of the page, which gives you the phone number to call if you have questions.
Understandably, LightStream is trying to keep costs down (so it can pass the savings onto borrowers), so you should send an email if it’s not urgent. It’s good to know the option to call is there, but representatives are on the ball when it comes to answering questions via email as well.
How LightStream Stacks Up
LightStream has very good terms and the fact it has no fees associated with its personal loan makes it a great choice. However, if your credit score isn’t up to par, you might not be approved. Here are a few other choices to consider when applying for a personal loan.
SoFi’s personal loan has similar rates and terms: the max amount you can borrow is $100,000, the max term is 7 years, and the fixed APR ranges from 5.49% - 14.24% if you're enrolled in autopay. The variable APR range is 5.29% - 11.44% (with a 14.95% cap). SoFi does not use FICO, but you do need to be "prime" or "super-prime" to qualify. It uses a soft pull for your credit to tell you your rates, and there are no origination or prepayment penalties.
If you feel more comfortable working with a traditional lender, Marcus by Goldman Sachs® is a great option. You can borrow up to $40,000 with an APR range of 6.99% to 24.99% for terms ranging between 36 to 72 months. Marcus personal loans offer a number of perks, including no origination fees, no late payment fees, the ability to defer payments after a full year of on time payments, and the ability to set the payment date that you want every month.
If you don’t need that much money and it’s only for credit card debt, consider Payoff. You can borrow up to $35,000 on a max term of 5 years, and the APR range is 8.00% - 25.00%. Its minimum credit score is only 700, and you’ll only have to undergo a soft credit check to find out your rates. Unfortunately, Payoff does have an origination fee of 2%-5%, but there aren’t any prepayment or penalty fees.
Shop Around First
Those looking to apply with LightStream for a personal loan will likely need excellent credit, but they’ll benefit from not having to worry about any fees. The downside is that you must use the loan for the purpose you select, whereas other lenders don’t have such limitations. If you’re looking to refinance student loans, you’ll have to look elsewhere.
It might be worth looking into an alternative like SoFi that uses a soft pull of your credit before shopping with lenders like LightStream that use a hard credit pull. You can see what rates you’re eligible for at those lenders first. If you choose to shop around, doing so within a 30-day period is recommended as it will have the least negative impact on your credit score.
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