Compare peer-to-peer loans

Investor-funded loans that could help you save.

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Peer-to-peer lending cuts out the middle man of a lender and connects you directly with investors who fund your loans. They can potentially give you more competitive rate, even without good credit — and with less paperwork than a bank loan. However, this nontraditional option is still in its beginning stages. Be sure your lender is legit by reading reviews before you apply.

Our top pick: LendingClub Personal Loan

  • Min. Credit Score Required: 640
  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $40,000
  • APR: 6.95% to 35.89%
  • Requirements: US citizen or permanent resident, verifiable bank account, steady source of income, ages 18+.
  • Available in 48 states
  • Checking rate won't affect your credit
  • Can apply with a cosigner

Our top pick: LendingClub Personal Loan

A peer-to-peer lender offering fair rates based on your credit score.

  • Min. Credit Score Required: 640
  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $40,000
  • APR: 6.95% to 35.89%
  • Requirements: US citizen or permanent resident, verifiable bank account, steady source of income, ages 18+.

How does peer-to-peer lending work?

Peer-to-peer (P2P) lending woks by connecting borrowers with investors who provide money for a loan. The main benefits of using a P2P platform is that they’re faster and can offer more competitive rates than traditional lenders like banks.

Why’s that? P2P platforms rely on algorithms rather than human underwriters to review your application, making it faster and cutting down on the overhead cost.

Many also consider data beyond your credit score when coming up with your rate when you apply— such as your level of education and employment history. So, you could potentially qualify for a good rate even if you only have student loans or a credit card.

How to get a P2P loan in 4 steps

  1. Apply. First, customers fill out out an online form with details about your financial situation, including your income, employment, debts and credit history.
  2. Get graded. P2P platforms typically gives your application a grade, which investors use to determine how much money they’re willing to lend you as well as your interest rate.
  3. Wait for investors to fund your loan. Because an investor can choose to partially fund your loan, it might take longer to receive your funds than with a traditional personal loan from a direct lender.
  4. Receive your money. If your loan is fully funded, it will be deposited into your account, generally within a few days.

How peer-to-peer lending got started in the US

Compare 4 peer-to-peer platforms

These peer-to-peer lending options can provide you with the financing you need to tackle a large expense.

LendingClub Logo Image: Supplied

1. LendingClub

LendingClub is one of the largest online peer-to-peer lending marketplaces in the world. Not only is it one of the few options that allows cosigners, you can also use it to connect with investors looking to fund both personal and business loans. And if you need to lower your monthly payments, LendingClub offers auto loan refinancing and medical loan refinancing options.

  • Loan amounts: $1,000 to $40,000
  • APR: 6.95% to 35.89%
  • Terms: 3 to 5 years
  • Eligibility: US citizen or permanent resident, verifiable bank account, steady source of income, ages 18+.
Go to Lending Club's site

Prosper logo Image: Supplied

2. Prosper

Prosper is one of the peer-to-peer lenders that started it all. It doesn’t affect your credit to check your rates, since it relies on a soft credit pull. Investors within Prosper’s network fund a variety of loan needs, from medical loans to personal loans for weddings and vacations.

  • Loan amounts: $2,000 to $40,000
  • APR: 6.95% to 35.99%
  • Terms: 3 or 5 years
  • Eligibility: Must be 18+ years old, an American citizen or US permanent resident and have a 640+ credit score.
Go to Prosper Funding LLC's site

Picture not described: prosper-supplied-250x2502.png Image: Getty

3. Upstart

Upstart might have only been around since 2012, but that hasn’t stopped it from making headway as a top contender. It focuses on recent college graduates and may use your GPA, SAT score and work history to inform your interest rate and loan amount. But, you need a low debt-to-income ratio and decent credit to qualify.

  • Loan amounts: $1,000 to $50,000
  • APR: 6.46% to 35.99%
  • Terms: 3 or 5 years
  • Eligibility: Must have good to excellent credit and be at least 18 and a US citizen or permanent resident.
Go to Upstart Personal Loans's site

Peerform logo Image: Supplied

4. Peerform

With one of the lowest interest rates available for well-qualified borrowers, Peerform is a peer-to-peer lender that offers mid-sized loans as an alternative to traditional bank loans. And with its invite-only debt consolidation program, you may be able to lower your monthly payments or reduce your interest rate by combining your current credit card or other loan debt into one bill.

  • Loan amounts: $4,000 to $25,000
  • APR: 5.99% to 29.99%
  • Terms: 3 to 5 years
  • Eligibility: Have a credit score of 600+, have a regular source of income, be at least 18 years old (19 in Alabama and Nevada), be a US citizen or permanent resident
Go to Peerform's site

Why get a peer-to-peer loan?

Peer-to-peer lending has been a growing part of the American credit sector since its inception in 2006. Here are a few reasons why borrowers choose to take out P2P loans:

  • Lower interest rates. The interest and fees you pay for a peer-to-peer loan is generally lower than what you’d find with a bank. APR tends to vary between 5.3% to 30%, depending on what you’re looking to finance and your credit score.
  • Flexible eligibility criteria. Peer-to-peer lenders base your rate on your credit history, income and other factors that a bank may not necessarily consider. You can apply with less-than-perfect credit, but your rate will be higher.
  • Less work than a bank. Typically, P2P loan applications are less involved and require fewer documents than a traditional bank loan application. They also tend to have higher approval rates.
  • Check your rate. You can get an interest rate quote without it affecting your credit score, which is usually not possible with a bank.

When to consider other types of lenders

  • You have bad credit. Even with more relaxed credit requirements, you typically need to have good to excellent credit to qualify for a competitive rate with the top peer-to-peer lenders.
  • You have an emergency expense. With peer-to-peer lending, you might have to wait a week or more for investors to fund your loan. Consider a direct online lender instead if you need money tomorrow.
  • You’re in serious debt. Debt consolidation is one of the most common uses for a P2P loan, but it can’t help if you’re already struggling to make debt payments.
  • You don’t want to pay fees. Most P2P lenders charge origination fees, so you might want to look elsewhere for a personal loan without fees.

What types of P2P loans are available?

While peer-to-peer lenders may offer a variety of loans, you’ll usually find most offer one or more of the following:

  • Unsecured personal loans. Peer-to-peer loans are often unsecured, which means you won’t have to put up any collateral as security. Loan amounts usually range from $1,000 to $50,000, and you can use your funds for just about anything.
  • Secured personal loans. If you have security, such as a car or valuable piece of property, you can take out a secured personal loan through a peer-to-peer lender. If you have bad credit, a secured loan may give a better chance of being approved and getting a lower rate.
  • Debt consolidation loans. If you have a few different loans and credit cards that are draining your budget, a debt consolidation loan from a peer-to-peer lender may be helpful. You may be able to lower your monthly payments by combining your debts into one loan.
  • Business loans. A newer type of financing is personal loans for business or P2P business loans. These business loans can help grow your business or get it up and running.

Is peer-to-peer lending safe?

Generally, yes. As long as you visit a legit lender that uses standard security measures in place like SSL encryption, P2P lending is no more dangerous than entering your information on any other lending website.

That being said, there is still always a risk: No website is immune from hacking. Make sure your lender is using an “https” URL and look for a lock icon in the browser before entering your information online. You also might want to review the privacy to learn what it does with your personal information.

3 questions to ask when comparing peer-to-peer lenders

Before you jump onto a peer-to-peer lending site, ask yourself these three questions to make sure you’re ready to borrow:

  1. How much will I be charged? This is an important aspect to consider for borrowers and investors. When it comes to borrowing, you need to consider what your rate will be and how much the loan origination fee will take out of your loan funds. For investors, you’ll want to find out what the provider will charge you in fees.
  2. Am I eligible? This is an important consideration for borrowers. Check the minimum criteria and make sure you meet it before applying. If your lender doesn’t offer preapproval with a soft credit check, applying could result in a dip in your credit with no loan to show for it.
  3. What happens if I default? If you want to invest, see what the marketplace lender has in place in terms of collection services for late or defaulted payments. Some lenders will take on the responsibility of collecting payments and some will charge a fee for this service.

How can I benefit as an investor?

If you’re looking to get involved in peer-to-peer lending as an investor, you may benefit from some of the following positive points:

  • Lucrative returns. Many investors have returns sitting between 5% and 9%.
  • Diversify your investments. You choose how much to fund per loan and you can spread your risk among multiple borrowers. This lessens the impact of negative results from late payments or defaults from riskier loans.
  • Easy for first-time investors. Playing the stock market may be difficult and time-consuming for first-time investors, but P2P lending is a much simpler way to invest. You choose where to put your money based on multiple loan factors and then receive monthly cash flow.
  • Different accounts available. You can have multiple account options with some providers, including retirement accounts or standard investment accounts.

Bottom line

Peer-to-peer lending can be a great alternative to traditional loans for both borrowers and lenders. Most offer similar amounts, equal terms and have the added bonus of getting you away from a single lender with more strict eligibility requirements. However, that doesn’t mean you won’t have to meet any — you’ll still need a regular source of income, and many P2P lenders have a minimum credit requirement as well.

Not every peer-to-peer loan will be right for you, so compare your options before making a final decision.

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10 Responses

  1. Default Gravatar
    AmySeptember 10, 2018

    I am in desperate need of a loan up to 5,000 for debit consolidation. I have tried every where my credit score isn’t the best and I know that’s what is hurting me. I just need someone to look past that an give me a chance. So I can get back on my feet.

    • Default Gravatar
      joelmarceloSeptember 11, 2018

      Hi Amy,

      Thanks for leaving a question on finder.

      Sorry to hear you are going through difficult times. Debt consolidation is one way to manage repayments and reduce debt if you have more than one account on which you pay interest. By moving all the separate balances into one account, you can start to reduce your liability by paying one monthly repayment instead of several. While many lenders require you to have a positive credit history to take out these loans, there are some who approve debt consolidation loans for those with bad credit if you click HERE.


  2. Default Gravatar
    CandiceJanuary 23, 2018

    I’m in desperate need of $4000 to buy a car.. I had a credit score of around 630 6 months ago but it’s 454 now because I have lived with a man for 4 years that WILL NOT work.. I’m on Disability.. I am sick..they think I have celiac mom got a loan for me but as always she never follows husband is abusive.. I just need a break.. Is there someone who can help me??

    • Default Gravatar
      joelmarceloJanuary 23, 2018

      Hi Candice,
      Thanks for leaving a comment on You may still be eligible for a loan even if you are on Disability pension. Please note that laws that apply to loans may vary from state to state so make sure you choose your state from the dropdown HERE.

      If you need further help, please send us a message anytime.


  3. Default Gravatar
    kdogDecember 19, 2017

    Hello! I would like to start rebuilding my score is right at 590 to 600. Exp even had me at a 623. So, I did get a capital one journey card, 300.00 limit. Can I get a personal loan anywhere with this score? Or should I give up until I have established better history with this new card?

    • Avatarfinder Customer Care
      RenchDecember 20, 2017Staff


      Thanks for your inquiry.

      Your overall credit score is determined by many variables, including your credit utilization rate. To indicate to lenders that you’re a responsible borrower, only carry a balance with a utilization of 30% or less. For example, if your credit limit is $1,000, keep your balance below $300, which is 30% of your limit. You can get helpful tips on this page on how to improve your credit score and how credit score works.

      While on this page, you can make use of our personal loan calculator to give you an idea.

      Best regards,

  4. Default Gravatar
    BenitaAugust 16, 2017

    I have low credit score defaults and I’m on fixed income monthly I would like to and need to take a loan however these facts of plow credit score and defaults have not been approved and I do not have a bank account so how can I or will I qualify for a loan

    • Avatarfinder Customer Care
      AshAugust 16, 2017Staff

      Hi Benita,

      Thank you for reaching out to us.

      You can refer to these pages to compare your options for Personal Loans and Cash Loans.

      Before applying, kindly make sure that you have met the eligibility requirements of the Lender and have reviewed the details of the loan.

      I hope this information helps.

      Let us know if there is anything else that we may assist you with.


  5. Default Gravatar
    ChydikeMarch 24, 2017

    How can I borrow a loan for a small business?

    • Avatarfinder Customer Care
      HaroldJuly 12, 2017Staff

      Hi Chydike,

      Thank you for your inquiry.

      Should you need a business loan for you may want to consider the options here.

      I hope this information has helped.


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