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    Discover Vs. Upgrade: Consolidation Loan Providers Faceoff

    Discover Vs. Upgrade

    Americans carry more debt than ever before, and real wages haven’t increased with the cost of living. Once debt has become so burdensome that it begins to impact quality of life, borrowers may turn to debt consolidation to help them regain control over their finances. 

    In recent years, many borrowers have turned to online lenders as a source for consolidation loans. Despite a crowded marketplace, Discover and Upgrade have emerged as two of the top options. Keep reading for a head to head comparison of the two, with an aim of determining which one offers borrowers more.

    Types of Debt That Can Be Consolidated

    Discover: This premium lender offers loans to individuals with a quality credit history. Discover consolidation loans are typically used to consolidate high-interest debt such as credit cards but can be used however the borrower desires. In some cases, the lender will require borrowers to pay 70% of their loan amount directly to creditors. Failure to do so can result in an outright rejection of one’s loan application or an increased APR.

    Upgrade: Just like its peer, the overwhelming majority of Upgrade debt consolidation loans are used to pay off credit cards and other high-interest debts. The legal agreement that accompanies this loan also explicitly states that any loan granted to an individual can’t be used for educational expenses or investments.

    The Winner: Discover - Whereas its peer puts a limitation on covering educational expenses, Discover student loan consolidation loans are available.

    Consolidation Loan Size

    Discover: These consolidation loan offers are fixed-rate and range in amount from $2,500 to $35,000, with the average loan being $18,000. How much an applicant is allowed to borrow depends upon their credit score, employment situation, and current debt load.

    Upgrade: With this platform, applicants have the option of a wide array of loan amounts. They can borrow as little as $1,000 up to $50,000 for those who qualify.

    The Winner: Upgrade - Although their interest rates may not be as good, this lender offers a higher max loan amount.

    Consolidation Loan Interest Rates & Duration

    Discover: Discover loan rates range from 6.99% to 24.99% depending on the borrower's credit score, the total amount borrowed, and the loan term. With loan terms ranging from two to seven years, this lender offers loans with a slightly longer payback period than most of its competitors.

    Upgrade: Consolidation loans from this lender come with a slightly higher interest rate on the low end and a much higher interest rate on the upper end, arriving between 7.99% and 35.99% respectively. Its term lengths are in line with the average online lender, giving borrowers a choice of three to five years payoff periods.

    The Winner: Discover - Because of its longer than average payment period and competitive interest rates, this lender delivers superior value.

    Eligibility Criteria

    Discover: To meet eligibility requirements, all applicants must be 18 years of age or older, have stable employment, and a debt-to-income ratio of 40% or lower. Officially, the lender states that its minimum accepted credit score is 660, although a score of 700 or above is required to receive a lower interest rate. The platform also requires a minimum yearly gross income of $25,000 for approval.

    Upgrade: This lender requires all the same information, but are willing to work with individuals who have credit scores as low as 620. Still these individuals are unlikely to qualify for competitive interest rates.

    The Winner: Upgrade - Although they may not offer the best interest rates, it makes it much easier to qualify for a loan.

    Application & Approval Process

    Discover: The consolidation loan application process here is fast and easy. The applicant simply enters their personal information, desired loan amount, and preferred payment period before the lender informs them about which options are available. The application process can be completed in as little as one day so long as the applicant submits all the correct information. If approved, funds can be deposited as quickly as the next business day.

    Upgrade: This platform requires the same basic information as most lenders, all of which is entered during the pre-approval process conducted through the website. If the applicant passes the soft credit check, they’ll be required to create an account through the website which necessitates the Social Security number (SSN) for verification. Once completed, the user can log in and review the offers they have available.

    The Winner: Discover - Although both lenders’ processes are simple and streamlined, the former’s application doesn’t involve creating an account.

    Loan Fees

    Discover: Unlike most lenders, Discover debt consolidation loans aren’t subject to an origination fee or prepayment penalties. This being said, they do charge a late payment fee of $39 and there is no grace period offered. This is much higher than the majority of online lenders, who either charge little or no late fee.

    Upgrade: Although there are no prepayment penalties, this lender’s consolidation offerings do carry an origination fee of 1.5% - 6.0% depending on the loan amount, term, and the applicant's credit score. There is also a $10 charge for any late or missed payments.

    The Winner: Discover - Even with a higher than average late payment fee, the lack of origination fee makes it the preferable option, especially for those who can stay on top of their payments.

    Special Benefits and Offers

    Discover: Flexible payment options along with useful online tools that help individuals keep track of their payment help add significant value to this company’s offerings. The lender also offers a unique 30-day money-back guarantee if the borrower can secure better terms from another competitor.

    Upgrade: This is one of the best lenders for those borrowers seeking to rebuild their credit. Through their account, borrowers can access credit rebuilding educational tools through the online platform. Late payments are also forgiven if the account holder is usually up to date with their payments.

    The Winner: Discover - While both offer quality benefits, the 30-day money-back guarantee can’t be beaten.



    Loan Amounts

    $2,500 - $35,000

     $1,000 - $50,000

    Minimum Credit Score



    Loan Term

    2 - 7 years

    3 - 5 years

    Application Approval Time

    2 business days

    2 - 3 business days


    -No origination fee

    -No prepayment penalty

    -$39 late fee

    -1.5% - 6% origination fee

    -$10 late payment fee

    -No prepayment fee

    Which Is Better?

    Comparing the two lenders is very much an apples and oranges scenario - Discover is better for those who already established a good credit score and Upgrade is a great option for those who are in the process of rebuilding their credit score.