Frequently Asked Questions

HandUp is a platform that helps friends and family formalize personal loans. Instead of a handshake deal with no paper trail, HandUp creates a structured agreement with a repayment schedule, automatic ACH payments, and documentation — so everyone is on the same page.

No. HandUp is not a bank, lender, or financial institution. We are a software platform that helps people manage and document loans they agree to between themselves. Funds move directly between parties via ACH bank transfers.

HandUp is for anyone lending or borrowing money with people they trust — family members helping a child buy a car, friends pooling together to help someone through a rough patch, or a small community supporting a local entrepreneur.

HandUp supports personal loans of any size between willing parties. There are no minimums or maximums imposed by the platform.

Yes. HandUp supports pooled lending, where several lenders each contribute a portion of the total loan amount. Each lender's share is tracked separately, and repayments are distributed proportionally.

Yes, lenders can set any interest rate including 0%. However, when a loan carries a below-market rate, the IRS treats the forgone interest as a gift to the borrower. Forgone interest above the annual gift tax exclusion ($19,000 per person in 2026) counts against your federal lifetime exemption. HandUp explains these rules during loan creation and suggests the current Applicable Federal Rate (AFR) if relevant.

HandUp charges a flat annual platform fee of 0.35% added to the borrower's interest rate, plus a one-time $25 origination fee at loan creation. Both fees are disclosed transparently in the loan terms. If credit reporting is enabled, an additional $5/month subscription applies.

Once a loan is fully funded and active, HandUp initiates ACH bank transfers on the scheduled payment dates. The borrower's payment is automatically split and distributed to each lender according to their share of the loan.

If an ACH payment fails, both the borrower and affected lenders are notified immediately. The borrower can retry the payment manually or resolve any bank account issues. HandUp does not charge late fees — that is up to the terms agreed between the parties.

Yes. Borrowers can make one-time additional payments at any time from their loan detail page. Early payoff is supported and there are no prepayment penalties imposed by HandUp.

If a scheduled payment is not completed after a failed ACH attempt and manual retry, the loan enters a 'past due' state. Both the borrower and all lenders are notified. HandUp does not impose late fees or penalties — any consequences are determined by the terms the parties agreed to. If the loan has credit reporting enabled, the missed payment will be reported to credit bureaus after 30 days.

If a borrower misses multiple consecutive payments (typically 90+ days), the loan status changes to 'defaulted.' The lender can choose to forgive the balance (which may have gift-tax implications), restructure the terms, or pursue repayment outside of HandUp. If credit reporting was opted into, the default will be reported. HandUp provides documentation of all payment history and the original agreement for both parties' records.

During loan creation, both parties can opt in to have payment history reported to major credit bureaus. On-time payments help the borrower build credit history. This works similarly to how landlords report rent payments — it creates a verified record of consistent, on-time financial commitments.

Yes. Credit reporting is a two-way street. If you opt in, both on-time and late payments are reported. Missed payments are reported after 30 days past due, consistent with standard credit reporting practices. This is a legal requirement for data furnishers under the Fair Credit Reporting Act.

Only loans with ACH payments processed through HandUp are eligible for credit reporting. This means there is a verified, bank-level record of every payment — money actually moved between real accounts. Both parties must also complete identity verification. This prevents fabricated loans from being used to game credit scores.

Credit reporting is set during loan creation and applies for the life of the loan. Both parties agree to it upfront as part of the loan terms. This protects both sides — the borrower knows their good payment history will be recognized, and the lender knows missed payments carry real consequences.

The loan itself is not taxable. The borrower does not owe income tax on money they borrow, and the lender does not owe tax just for making a loan. What can trigger IRS rules is the interest — or lack of it. If you charge below the IRS Applicable Federal Rate (AFR), the forgone interest may be treated as a gift to the borrower. HandUp flags this during loan creation and shows you the current AFR so you can make an informed choice.

In 2026, you can give any individual up to $19,000 per year — in cash, forgiven interest, or forgiven loan principal — with zero tax, zero paperwork, and no impact on anything else. That $19,000 resets every January 1st. If you and a spouse are both lending to the same person, you can each give $19,000 (totaling $38,000) before any rules apply. The annual exclusion amount is adjusted for inflation periodically, so check IRS.gov for the current figure.

You file IRS Form 709 (a gift tax return) — but filing that form does not mean you write a check to the IRS. Instead, the amount above $19,000 reduces your lifetime gift and estate tax exemption, which is $15 million in 2026. Think of it like a very large bucket. Every dollar above the annual exclusion takes a small chip out of that bucket. For the overwhelming majority of people, the bucket never empties in their lifetime, so no tax is ever actually owed.

Rarely — and almost never immediately. Gift tax only becomes an actual bill if your total lifetime gifts above annual exclusions exceed the lifetime exemption ($15 million in 2026). Even then, it is typically handled through your estate, not as an out-of-pocket payment during your lifetime. For context: a parent who forgives $50,000 in loan interest over several years is only reducing their lifetime exemption by a small fraction, and still owes nothing today. If you believe you may be approaching the lifetime exemption, consult a tax advisor or estate attorney.

Yes. If a lender formally forgives part or all of the remaining loan balance, the forgiven amount is treated as a gift to the borrower. The same annual exclusion ($19,000 per person per year in 2026) and lifetime exemption rules apply. The borrower generally does not owe income tax on forgiven debt between private parties — but may owe it in other contexts. HandUp is not a tax advisor; if you are planning to forgive a significant balance, it is worth a quick conversation with a CPA.

Only people you explicitly share your private invite link with can see your loan details. HandUp does not list loans publicly or share them without your permission.

Bank account connections are handled through encrypted, SOC 2-compliant infrastructure. HandUp never stores your full account credentials — linking is done via secure tokenized connections.