Align is a new type of lender that provides fast loans with flexible payment schedules to people with near prime credit. Instead of charging borrowers interest in the traditional sense, Align requires them to pay a percentage of their income for a set period of time. This is called an Income Share Agreement (ISA). If their income drops or they lose their job, the loan payments drop accordingly. The company was launched in 2011 by Nathan Popkins. It has already issued millions of dollars in ISAs to thousands of customers, and its growth is accelerating. Align is based in Chicago, IL, and has an A+ rating with the BBB.
How Does Align Work?
Align provides cash in exchange for a small percentage (10% or less) of a borrower's income. Align doesn't require any collateral so borrowers can use the money for whatever they want, from debt consolidation to home repairs or medical bills.
Align views the new financing structure as an investment in borrowers that struggle to find credit elsewhere. If the borrower has a reduction in income, payments to Align go down, potentially all the way to zero if someone becomes involuntarily unemployed. Payments to Align will also increase proportionally if the customer’s income rises, customers can repurchase their ISAs from Align as soon as they are able, Repurchase rates vary based on each contract and are provided once an application is completed.
What Are Align's Rates and Fees?
Because of the way Income Share Agreements work it’s impossible to say exactly how much interest a borrower will pay on a loan. It all depends on how much the borrower’s wages fluctuate during the period the Income Share Agreement is in place. However, Align provides a series of scenarios that specify the equivalent rate that will be paid in each scenario. According to Align, the average equivalent rate on loans has been in the mid-double-digit APRs.
We applied for Income Share Agreements with incomes varying from $50,000 to $100,000 and terms ranging from 4 to 5 years. The equivalent APRs ranged from 37% APR to 94% APR.
How Much Money Can I Borrow From Align?
Align provides loans ranging from $1,500 to $12,500.
Which States Does Align Operate In?
Align operates in Delaware, Georgia, Utah, Illinois, and New Mexico.
What Is Align's Application Process Like?
Align has an online application that only takes a few minutes to complete. Once you complete it, Align will give you a no-obligation quote for you to consider. At this stage, Align does not make a hard credit inquiry, so there is no risk to your credit if you decide to check your rate.
If you are interested in the Income Share Agreement, Align will request your permission to run a credit check and verify your bank account to check the information you provided in your application and verify your identity. Borrowers must have a credit score of at least 600 and an annual income of $22,000 or more.
Borrowers who satisfy Align’ eligibility criteria and provide the necessary information can receive their funds within one or two business days.
How Is Align Better Than Other Lenders?
Align provides mid-double-digit APRs to borrowers with poor credit. These rates are certainly not low, but they are much better than a payday loan. The application process is fast, and funds can be transferred within one business day.
One advantage Align has on other lenders is that payments are flexible. If you lose your job or your hours are cut, your payments will also drop. In certain circumstances, they could drop down to zero. The only catch is that payments also increase if your income increases.