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Money lending companies in San Francisco recently performed new service. They offer online personal loans with interest rates that are usually set depending on the credit score. However, it also counts several unconventional factors.

Terms and rates

The Earnest Company for instance suggests unsecured and convenient loans with fixed rates for personal use. The meaning of interest rate varies from 4.25% to 9.25% depending on some factors including credit score. Consumers are able to borrow from $2 000 to $30 000 on a term from one to three years.

Interest rate is set in an unusual way because there are some more factors except consumer’s credit which affect the rate. The lender calls it “interest rate based on merit”. Such factors are taken into consideration when setting the rate:

The size of consumers income;

  • Education;
  • Career achievements;
  • Amount of savings;
  • Credit score.

All this information influences consumer’s ability to get the loan and determines the interest rate on which the loan would be given.

Concept of ‘merit’ based personal loans

Today credit market is experiencing a boost in the US so such personal loans should become popular very fast. They would be especially demanded by millennials as a significant help with student loans.

Louis Beryl, Earnest’s CEO and co-founder, expressed the thought that it would have been great if human’s personal achievements resulted in money gains. He explained that they designed ‘merit’ based interest rates in order to provide responsible and stable consumers with beneficial borrowing option on the most attractive interest rate.

For now these personal loans are not available in all states but in California consumers are able to avail of it.