Elastic is an unsecured line of credit product from Elevate Credit Inc. offered in partnership with the Republic Bank & Trust Company. The Republic Bank is an FDIC member based in Louisville, KY. It has an A+ rating with the BBB and over $3 billion in assets. Elastic gives borrower access to a line of credit, but it only charges interest on the money they withdraw.
Elastic offers a line of credit you can withdraw from and deposit directly into your checking account. Borrowers can request as little as $20 up to their line of credit limit. As you repay the loan, your line of credit increases and you can access more money right up to your credit limit. Payments are due every two weeks, instead of every month.
Elastic doesn't charge interest in the traditional sense. How much you pay in interest will depend on how long you take to repay it. All withdrawals come with a 5% cash advance fee. If you pay the loan before the end of the payment cycle, there are no additional fees. If you don't pay the balance in full, you will be charged a minimum fee that goes from $1 (for over $20) to $100 for $3,500 depending on the size of the loan.
For example, if you borrow $400 and only make minimum payments it will take you four months (8 billing cycles) to pay, and it will cost you $485 plus the 5% cash advance fee. The equivalent APR in this scenario would be around 150% APR. However, if you paid the same amount within two weeks of receiving the money, you will only pay the 5% cash advance fee: the equivalent of a 137% APR.
Elastic offers lines of credit ranging from $500 to $3,500. Once you have a line of credit you can choose to withdrawal however much you want (up to your limit) in multiples of $20.
Elastic requires borrowers to complete an online application form to determine eligibility. At this time (October 2016), only people who have received a pre-selection letter with an enrollment code can apply. Elastic requires basic contact information, Social Security Number and other identifying documents, such as a driving license, to verify the information provided. If all eligibility requirements are satisfied, borrowers can receive their money within one business day.
Elastic provides an easy and fast source of credit to people with less than great credit. It works like a credit card in the sense that you only pay interest on the amount of money you use not the entire credit limit. This provides a safety net for unexpected expenses to people with poor credit who can't qualify for traditional credit card and loan products. The rates are certainly not low, but they are much better than payday lenders and overdraft fees.