In this Review..
Marcus is an online only lender offered by Goldman Sachs. It offers personal loans with no fees including late fees, prepayment fees or sign up fees. Since you’re only required to pay the principal loan sum and interest, the interest rates are a little higher than the competition. However, this can be a good option for those with a good credit score who want to avoid annoying fees.
Where Marcus personal loans are a little different is that there is the option of prequalification. If you’re not sure if you will be eligible for a loan, you can complete a basic, short form. This only involves a soft check, so you can avoid triggering a hard credit check and potentially compromising your credit score. Prequalification will allow you to check and compare your Marcus loan options.
Marcus personal loans are available from $3,500 to $40,000 with fixed APR rates ranging from 6.99% to 19.99%. You can also receive a 0.25% discount if you opt for autopay. This involves a larger portion of your monthly payment being applied to the loan principal, so less interest will accrue on your account. You can have a loan with a term from three to six years.
Marcus is for borrowers with high-interest debt, solid credit, and strong cash flow who are interested in consolidation.
6.99% – 24.99%
$3,500 – $40,000
Marcus by Goldman Sachs has several different loan options depending on your needs:
- Debt Consolidation: $3,500-$40,000
- Home Improvement: $3,500-$40,000
- MarcusPay: $750-$10,000
There aren’t any fees applied to this loan option but there are some caveats to Marcus. For starters, this lender isn’t available in all 50 states. They also require a fair credit score, so you can’t borrow from them if you have bad credit. Along with that, there’s a limit to the amount you can borrow too.
Marcus Loan Pros & Cons
As we know, each lender has its own pros & cons – here are the relevant things we found for potential borrowers:
What Can a Marcus Personal Loan Be Used For?
Marcus personal loans can be used to consolidate debt, pay for home improvements, wedding expenses, moving costs or vacations. It cannot be used for any post-secondary education expenses.
Marcus home improvement is for home repairs or projects. The advantage of using a personal home improvement loan for this is the promptness of receiving the funds. Typically, it takes a month or more to get an equity line of credit on your home. Another advantage over a home equity line of credit is that it’s based on the creditworthiness of the borrower, not the equity of a home. You can use a Marcus loan to start your home improvement project immediately.
The Marcus website section on home improvement goes over the benefits of a personal loan when compared with other forms of credit. Marcus has a home addition calculator that can give you an idea of how much your home project could possibly increase the value of your home.
Marcus debt consolidation and/or credit card consolidation takes one or more loans and pays them with the new Marcus personal loan. Instead of multiple payments to multiple lenders, you can create one payment to one lender.
The advantage of a debt consolidation loan with Marcus is that the payment and term are fixed so you know exactly when you’ll be out of debt. Marcus focuses on debt consolidation loans and their website has quite a bit of information and education on what to expect. Marcus also has a debt consolidation calculator that you can use to see if a debt consolidation loan would be worth it.
- A+ on BBB: BBB assigns ratings from A+ (highest) to F (lowest). BB ratings are based on information in BBB files with respect to factors such as the business's complaint history with BBB, type of business, time in business, transparent business practices, and more.
- 884/1000 points on J.D Power: Marcus ranks 2th in the study and got 884 out of 1000 possible points in the 2020 research, higher than industry average. .J.D Power offers the most comprehensive and independent study of personal loans consumer satisfaction . The study aims to help consumers and issuers to understand user opinions and ratings of top lenders. It covers terms, benefits, services, communication, transparency and more.
You can apply for a Marcus loan online or by paper. You can call Marcus at 1-844-627-2871, and have a paper application sent. If you would like to check your options online with Marcus, you first choose the loan amount you want with the associated potential payment. If after checking this you want to move forward, click “find my options.”
Then you enter some basic personal and financial information as well as the loan purpose. Marcus will then do a soft pull. A soft pull does not affect your credit. After the soft pull, Marcus will then present a few loan options for you based on the information you provided. If there is a loan you see as a good fit, you can then apply for that loan and Marcus will do a hard credit pull.
They will usually let you know within a day if you are approved or not. If not, you will get a letter in the mail outlining the reasons for the decline.
Marcus may need additional information after the application is filled out. This is common. They may request verification items like paystubs, bank statements, W-2s, social security card, or state ID. Marcus typically does a good job of verifying information through automated systems, so you may not have to provide any of this information.
You can sign loan documents online and it then takes 1 to 4 days for your funds to be deposited into your banking account.
Marcus is part of the Goldman Sachs group. It offers access to personal loans with affordable rates, particularly if you use autopay. However, the lowest rates are only available if you have excellent credit.
Another reason why Marcus is a good place to get a loan is that this lender doesn’t charge any fees. There are no origination fees, prepayment penalties or even late fees. So, the price you’re quoted on your loan agreement is what you will pay, regardless of whether you pay off your loan early or you miss making a payment on time.
In order to make a lending decision, Marcus does require you to specify your total annual income. The lender asks that while it does not need to be an exact figure, it should be as accurate as possible. Marcus may also ask for personal bank statements, recent pay stubs, tax transcripts and W-2s as supporting documentation for your application.
Best Egg is a solid alternative to Marcus for your personal loan. This lender does have a higher maximum loan amount, you can also qualify with a lower credit score. However, the maximum loan term is five years, rather than six with Marcus.
However, what really makes Marcus better than Best Egg is the loan rates. While Best Egg has a lower starting rate, at the higher end of the scale, Marcus has a lower maximum rate.
On the surface, Upgrade offers similar services to Marcus and appears to have the edge. You can borrow similar amounts with a similar credit score .
However, Upgrade only offers the option of a loan term of three or five years. Additionally, the APR rates are generally higher. Another reason why Marcus has the edge over Upgrade is that Upgrade is not available throughout the US.
Like LightStream, Marcus don’t charge any origination, application or early repayment fees. However, Marcus does have a higher starting interest rate. The available loan amounts are also less compared to the maximums offered through LightStream.
So, if you are looking for a larger loan, LightStream is a better option.
Alternatives Lenders For Consideration
Here are our 3 choices of lenders which can use as a great alternative to Marcus personal loan:
This is a unique lender created in 2012 by a group of former Google executives. They are the first lending platform to use artificial intelligence with an automated lending process. The company aims to go the extra mile for its customers.
Most lenders primarily focus on a FICO score to approve a loan. However, Upstart uses its advanced technologies to look beyond this and explore the risk of your loan. These calculations are used to assess your ability to repay your loan.
The company has a strong belief that if lenders would use its intuitive credit model, they would probably be approving more loans.
For borrowers, this means that Upstart can offer high quality loans at low interest rates. With fair terms for borrowers with bad credit, this company has a strong reputation with excellent reviews on Trustpilot and other sites.
Best Egg is an online lender that was founded in 2014. Best Egg specializes in personal loans and has funded over 600,000 loans.
Like Marcus personal loans, Best Egg also offers prequalification. This allows you to check your initial rate without affecting your credit score. A hard inquiry will only be conducted if you decide that you want to move on with your application.
If you have good credit, you can expect a very low-interest rate, and loan processing is fast, taking just a few minutes to complete.
SoFi has moved away from that business model and moved to a “non-traditional underwriting approach focused on lending to financially responsible individuals. SoFi uses an underwriting model that examines free cash flow, professional history and education in addition to a history of responsible bill payment to evaluate its borrowers.”
SoFi personal loans have no origination or late fees. They also do not have a prepayment penalty so the loan can be paid off early without additional costs. SoFi gives borrowers flexibility in payments and allow you to change payment due dates and do not charge late fees.
Marcus Loan is Best for..
Marcus is for borrowers with high-interest debt, solid credit, and strong cash flow who are interested in consolidation. Marcus has competitive rates but the biggest advantage of using Marcus is that they have no fees. Even if you get a lower rate with another provider, that lender may have an origination fee of up to 6%, which definitely eats into the amount you can borrow and increases your overall costs.
If you are looking to pay off your credit card debt, Marcus is a good option, and with their initial soft pull you can check your options without affecting your credit. You can also take comfort in the fact that Marcus is backed by one of the largest banks in the world, Goldman Sachs.