Avant Loans Review 2023

The bottom line: Avant loans can help sole proprietors with fair credit scores get enough cash to launch their startups. Avant’s minimum credit score requirement is 580—much lower than most traditional lenders. And unlike some personal lenders, Avant doesn’t keep you from using funds from a personal loan to cover business expenses.

But borrowers with lower credit scores won’t qualify for the best loan terms, and Avant’s minimum APR is higher than that of personal lenders like Rocket Loans and Upstream. If you have a good credit score in the 600 to 700 range, you’ll probably get a better rate with another lender. Still, if your credit score has kept you from qualifying elsewhere, Avant is definitely worth a look.

We recommend Avant loans for first-time business owners who don’t qualify for a small-business loan but need a lump sum to launch their startup. Avant loans are also a good fit if you have a bad credit score and want to raise it by paying off several debts and making regular loan payments. (Upping your credit score now will help you qualify for better small-business loans in the future.)

Avant can approve loans for borrowers with credit scores as low as 580—a novelty in the personal loan sphere, where most lenders require a score of at least 600.

Of course, lenders look at much more than your credit score to decide if you qualify for a loan. Even if you meet Avant’s credit score requirement of 580 or above, you could still be denied a loan. Plus, you’ll probably be met with a high APR. Expect a rate closer to Avant’s maximum rate than its minimum.

Still, your chances of qualifying for a loan even with a low credit score are higher with Avant than with most lenders. And even though Avant has a fairly steep APR, its interest charges are substantially lower than those you’d get with a payday lender or merchant cash advance.

A payday loan can have up to a 400% APR while merchant cash advances can hit 350%. Merchant cash advances and payday loans are very predatory and we don’t recommend them. So if you can qualify for an Avant loan, even if you can only secure it on the high end of Avant’s APR spectrum, it’s still a much more affordable option for “fair” credit score borrowers than a cash advance.

Avant’s personal loans are installment loans, meaning once your loan is approved, you’ll receive a lump sum that you pay back (with interest) on a set schedule. The length of that schedule and the amount of interest you’ll pay depend on your credit score, loan amount, debt ratio, and other factors.

Avant points out that installment loans are particularly helpful for covering a few key situations:

• Home improvement projects
• Emergency expenses (for instance, an unexpected medical bill)
• Debt consolidation

Additionally, if your personal lender allows you to use its funds for business purposes (and Avant does), an installment loan like Avant’s can help you cover the upfront costs of starting a business.

For example, before you can open your doors, you might need to buy equipment, invest in inventory, set up a business website, and find retail space. A lump-sum loan payment can help you gather what you need to launch your startup so you can start generating revenue and paying off the loan.

Avant offers two types of loans: unsecured personal loans and secured personal loans. An unsecured personal loan doesn’t require you to offer anything up as collateral. As a result, you’ll have a higher APR (annual percentage rate) and end up paying more interest over time. But you won’t lose any of your personal assets if you end up having to default on the loan.

In contrast, a secured personal loan requires you to offer up a personal possession like a car as collateral. You agree that if you can’t repay the loan, the lender can reclaim the asset you used as collateral to make up the cost. Secured loans, including secured Avant loans, usually come with a lower APR because the lender is more confident in your ability to cover the cost of the loan no matter what. 

Avant isn’t the only option for funding your business with a personal loan if you don’t secure a small-business loan. Based on your credit score, preferred loan term, and available interest rates, it might not even be your best option—which is why we always recommend checking with multiple lenders when you’re looking for either a business or personal loan.

Avant clearly has one of the highest minimum APR of any personal lenders listed here. If you get an Avant loan, the lowest rate you’ll qualify for—regardless of how good your credit score is—is 9.95%. If you got the same loan from another lender at their lowest listed rate, you’d pay much less in the long run than you would by taking out the same loan amount at Avant’s lowest listed rate.

However, Avant has a lower minimum credit score requirement than many lenders. If low credit means you can’t secure funding with anyone else, Avant might offer the best personal loan for you. Like we said earlier, an Avant loan offer is a much better deal than a merchant cash advance, even an Avant loan with a higher APR.

Since Avant still checks your credit, its APR is still lower than that of lenders like OneMain Financial that don’t check your credit score at all. If your bad credit score is 580 or above, you’ll get a better rate with Avant than with OneMain Financial—so if you can apply for Avant, we recommend starting there.

In contrast to other lenders, Avant’s shortest loan term is just one year. If you know you can pay off a loan within a year and prefer a short-term loan to a five-year one, Avant might make the most sense for you.

For the most part, then, we’re not too troubled by Avant’s customer service scores.

However, we do want to point out that Avant was under investigation by the Federal Trade Commission until fairly recently. The FTC sued Avant in 2019, charging the company with (among other things) unfairly charging too much interest on its loans. In January of 2022, the FTC gave nearly $4 million back to consumers who had been defrauded by Avant.³

The federal investigation has been resolved and the FTC is no longer pursuing charges against the company. Most importantly, the customers involved got at least some of their money back.³ It looks like Avant has fixed its false advertising and other issues since the FTC complaint, but we wanted to make you aware of it so you can make an informed decision about whether or not to apply for Avant credit cards or loans.

Apart from personal installment loans, Avant also offers a credit card. Its credit limit starts at $300 but can go as high as $3,000 depending on your credit score and payment history.

As with its loan APR, the APR for an Avant credit card APR is above the national average of around 23%.⁴ In contrast, the Avant credit card APR ranges between 27.24% and 29.99%. Depending on your ability to make on-time payments, Avant’s interest rate might mean you spend more money paying off purchases than you would with another card.

Still, while Avant charges an annual fee that ranges up to $59 (the fee is waivable under certain conditions), it doesn’t charge overdraft fees. You don’t get many other perks with the card, but Avant’s basic credit might be a good option if you don’t qualify for a loan.

Avant is one of the best personal loan choices for would-be borrowers with “fair” credit scores who don’t qualify for small-business loans. Its lump-sum funding is a nice solution for sole proprietors who are trying to cover the many costs of launching a startup.

But if you score in the mid-600s or higher, we recommend checking with other lenders before committing to Avant. Avant’s higher-than-average APR means those with “good” credit scores and above can likely secure a better rate with a different lender.

Not sure Avant is a great fit for you? Check out our list of the best loans for small businesses to find a better lender for your needs.

Avant’s lowest minimum credit score requirement is 580, which is a “fair” credit rating. If your credit is lower than 580, Avant will not fund your loan. Additionally, Avant may not offer you a loan even if your credit score is 580 or higher. Lenders take multiple factors under consideration when deciding whether or not to grant you a loan, so a credit score on its own isn’t enough to guarantee a loan.

You can usually get a copy of your credit report without taking a hit to your credit score. Your bank might provide a free credit report (check its website or app or talk to a banker to make sure), or you can sign up for a credit monitoring service like Experian that sends you frequent credit reports.

Yes, Avant offers debt consolidation loans that could be a good fit depending on your circumstances.

Consider a debt consolidation loan if interest rates from your other creditors are collectively higher than the interest rate you secure from a consolidation loan. In particular, debt consolidation loans make a lot of sense if you have a lot of credit card debt. Maxed-out credit cards often have huge interest rates, so it’s a good bet that the combined sum of your credit card debt and APR is much higher than APR on a loan from Avant.

Consolidating your debt with an installment loan is also a good idea if you tend to miss payments. It’s easier to stay on top of paying one bill a month instead of juggling several payments with different deadlines. Plus, if you forget to make one loan payment, you’ll be hit with just one late fee (for Avant, we think that’s $25 a month). That’s much better (and cheaper) than paying a late fee for every late payment you make.

Yes, Avant is one of the best personal loans for bad credit if your bad credit score is in the “fair” range, not the “poor” range.

That terminology is a little confusing, especially since “fair” doesn’t usually mean “bad.” But FICO, an organization that created one of the most popular credit score metrics, divides its credit scores into five categories: poor, fair, good, very good, and exceptional. Per FICO, “poor credit” is any credit score below 580 while a “fair” score ranges from 580 to 669.

In other words, a FICO credit score lower than 669 is technically bad credit. A FICO score 670 or above is a good credit score. Avant only accepts applications from individuals with a 580 credit score or higher, so if your bad credit score is 580, you can apply for an Avant loan.

If your credit score is lower than 580, you can still get a bad credit loan, but not through Avant. Instead, look to these lenders:

• Lendio is a loan marketplace, which means it matches you with a lender whose loan meets your qualifications. Some—though not all—lenders through Lendio accept applicants with credit scores of 560 (“poor credit”) or higher.
• Kiva is a peer-to-peer lender that offers microloans up to $15,000 with no interest and no minimum credit score requirement.
• OneMain Financial is another personal lender that doesn’t have a minimum credit score requirement, so you can apply for a loan regardless of how low your FICO score is. The tradeoff is a high APR: OneMain’s loans start at 18% APR.

To find more bad credit loan options, check out our piece on the best bad credit loans for startups.

To write our Avant review and calculate our star rating, we assessed Avant’s strengths and weaknesses in several key areas, including its loan types and amounts, minimum and maximum listed rates, customer service hours, user reviews, time to funds, and overall reputation.

Disclaimer

At Business.org, our research is meant to offer general product and service recommendations. We don't guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.