Key takeaways
- The Wells Fargo Flex Loan is the latest personal loan offered by the bank.
- It is a small dollar loan only for current customers.
- The personal loan comes with a small fee and instant funding.
The Flex Loan from Wells Fargo lets customers access a small amount of cash quickly and easily. Current customers can borrow $250 or $500 with a flat fee of $12 or $20, respectively. The money is repaid in four monthly installments to ensure it is affordable.
The small dollar loan is perfect for borrowers who are low on cash and need a little extra to fill in the gaps between paychecks. Let’s dive in further to see if it’s the right choice for you.
Flex Loan for borrowers needing a small amount
Wells Fargo Flex Loans can be a practical solution if you need a small amount of cash fast. It is designed to help people cover emergencies or fill the gaps between paychecks without resorting to high-interest payday loans. Eligible customers are pre-approved and receive instant access to the cash.
Many large banks are offering similar small-dollar loans. Regions Bank, Truist, Bank of America, Huntington Bank, and U.S. Bank all offer personal loans ranging from $250 up to $1,000. Pew found that these personal loans are priced 15 times lower than payday loans. The lower costs make them a good alternative. Even so, they should be used sparingly. Smaller loans can become expensive if you start to rely on them.
Wells Fargo Flex Loan requirements and fees
Only for Wells Fargo customers
Wells Fargo does not disclose its eligibility requirements for the Flex Loan other than you must be an existing customer. Most likely, you will need to have a Wells Fargo account for at least 12 months (a requirement for their other personal loans) and have a good relationship with the bank. This means a positive bank balance and regular direct deposits. It doesn’t hurt to also have a good credit score.
The bank states that customers can only take out one Flex Loan at a time and are limited to three per 12-month period. Additionally, if you receive one, you are not guaranteed another.
Competitive fees
The Wells Fargo Flex Loan comes with a flat fee of $12 or $20 based on the loan amount. There are no hidden fees and no origination fees. Nor are there fees for late payments or any interest charges. This means you will know the total cost right away.
The total borrowing cost is expressed as a percentage, known as the annual percentage rate (APR). Wells Fargo calculates the APR for their Flex Loans so that customers can understand the exact costs. Borrow $250 with a $12 fee, you get a 22.82% APR. While borrowing $500 with a $20 fee equals a 19.05% APR. Compared to the 400% APR charged by most payday lenders, Wells Fargo’s Flex Loans are a much better deal.
Affordable loan terms
Flex Loans are repaid in four equal monthly installments. The four installments are designed to make payments affordable and not stretch out too long.
If you borrow $250 with a $12 fee, the total amount due would be $262. Split that into four equal payments, and it’s $65.50 per month.
You can always repay the money early without any prepayment penalties.
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How to apply for the Flex Loan
The Wells Fargo’s Flex Loan is unique. There is no application process, so no credit check. Instead, you are preapproved by the bank. This is why you must be an existing Wells Fargo customer to qualify.
You can check if you’re pre-approved by going onto the Wells Fargo app. Click the Explore tab and then select Loans. If you’re pre-approved, you can accept the offer and the funds will be deposited into your bank account in seconds.
Payments can be made online. You can set up automatic payments or do online transfers every month via the Wells Fargo app or site.
Flex Loan pros and cons
The Flex Loan is certainly a more affordable than other short term cash loans. Like anything else, it has its pros and cons.
Pros:
- Only charges a flat fee
- Smaller loan of $250 or $500
- No hard credit check
- Fast funding
- No late fees
- No prepayment penalties
- Affordable monthly payments
- No application required
Cons:
- Available only for current customers
- Only comes in two loan amounts
- Has one fixed repayment term
- Must be pre-approved
- Cannot change your due date
- Must have the mobile app
Check the Wells Fargo Flex Loan reviews and consider your own financial situation before you make a decision.
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Who is the Flex Loan good for?
The Flex Loan is a good choice for current Wells Fargo customers who need quick access to a small amount of cash and have a regular source of income. It is intended to cover unexpected expenses, help customers avoid overdraft fees, or bridge gaps in paychecks. The single flat fee equals a 19.05% or 22.82% APR. Both are well below 36%; the maximum APR small personal loans can have and be considered affordable, according to the National Consumer Law Center.
Who is the Flex Loan not good for?
It is not a good option for those who are not Wells Fargo customers. It’s also not ideal for borrowers seeking large loan amounts or those with excellent credit who may qualify for personal loans with lower APRs. You must earn enough to afford the monthly payments. Lastly, if you live in a state where it isn’t available, you’ll need to explore other lending options.
Looking for larger loans?
Additional Wells Fargo personal loans
Wells Fargo offers other unsecured personal loans. As with most personal loans, they are versatile and can be used for multiple purposes, including debt consolidation, home improvements, or financing large purchases. Best yet, qualifying customers can apply online and receive same-day approval and fast funding.
Personal loan details:
- Fixed interest rates: APRs range from 7.49% to 24.99%
- Loan amounts: $3,000 to $100,000
- Terms: 12 to 84 months
- Fees: No origination fees, no closing fees, and no prepayment penalties
- Relationship discount: Set up automatic payments from your Wells Fargo checking account
- Minimum credit score: Not disclosed
Wells Fargo lets you check your rates without any impact on your credit score. If you’re interested in a Wells Fargo debt consolidation loan, the debt consolidation calculator can help you evaluate your choices. The calculator shows you what you will potentially pay and save with consolidation.
A Wells Fargo personal loan is a good fit for current customers thanks to the variety of loan amounts, flexible repayment options, and the ability to prequalify before applying.
Other borrowing options
We’ve put together a few alternative borrowing options in case personal loans from big banks are not for you.
Cash advance apps: These apps provide small, interest-free advances on your next paycheck without a credit check. Simply link your bank account, and the app will determine how much to lend. They will ask for a small fee – usually a monthly subscription, flat fee, or optional tip.
Payday alternative loans (PALs): Offered by some federal credit unions, PALs are small, low-cost loans designed to provide an alternative to high-interest payday loans. Their interest rates are capped at 28% APR and repayment terms tend to be manageable. You do have to be a member of a credit union to apply.
Borrow from friends and family: This can be a very affordable option as most people will not charge interest or fees to loved ones. It is very important to clearly lay out a repayment plan and stick with it. Good communication and repaying the money responsibly can help avoid strains on the relationship.
Buy Now, Pay Later Apps (BNPL): BNPL apps let you split purchases into smaller, manageable payments. Payments are typically made over a few weeks or months on a predetermined schedule. Pay on time and there’s usually no interest or fees.
Financial assistance programs: Look for charities or non-profit organizations that provide financial aid for essential expenses like utilities, rent, or medical bills. If you need help finding local resources, call 211 for guidance.
Frequently asked questions
1. Does Wells Fargo’s Flex Loan affect my credit score?
Yes, it can impact your credit score once you accept the money. Any late payments, missed payments, or defaults are reported to the credit bureaus – Equifax, Experian, and TransUnion – and will be listed on your credit report, hurting your score.
2. Is it easy to be approved for the Flex Loan?
Wells Fargo does not disclose the criteria it uses to pre-approve customers for the Flex Loan so it is not possible to say.
3. What are the disadvantages of the Flex Loan?
These loans are only available for existing Wells Fargo customers on a pre-approval basis. Besides not being able to apply, you are limited to two set loan amounts with a predetermined repayment period. While the flat fee equals a lower APR than most small loans for bad credit, it is a high APR if you have a good credit score. Lastly, these loans are not available in all states.
Bottom line
The Flex Loan is a quick and hassle-free way to borrow money when you need a little extra cash. The personal loan is designed to be an alternative to payday loans with its fast funding and reasonable flat fee. True, it is only on a pre-approval basis for existing customers, but if you qualify, it can be the right solution.