Prosper peer-to-peer loans review July 2018 | finder.com

Prosper review

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Get a personal loan through Prosper with a transparent application process and no hidden fees.

finder.com’s rating: 4.0 / 5.0

★★★★★

Prosper is the pioneer of peer-to-peer online lending in the US. It has helped facilitate over $10 billion in personal loans to date. For borrowers, getting a personal loan through Prosper works similarly to other online loan providers. Individual investors review loan listings on Prosper and fund applicants who meet their criteria, and it won’t hurt your credit to apply.

Product NameProsper Personal Loans
Min Loan Amount$2,000
Max. Loan Amount$40,000
APR6.95% - 35.99%
Minimum Loan Term3 years
Maximum Loan Term5 years
RequirementsMust be 18+ years old, an American citizen or US permanent resident and have a 640+ credit score.

Do I qualify?

Prosper requires applicants to

  • Have a minimum credit score of 640
  • Be 18 or older
  • Be a US citizen or permanent resident
  • Live in an eligible state

Residents of Iowa, North Dakota or West Virginia are ineligible for a personal loan through Prosper.

How does Prosper work?

Prosper isn’t quite like a direct lender or a loan-connection service. It doesn’t fund your loan, and it won’t send you along to another lender’s website. Instead, you submit an application for individual investors in Prosper’s marketplace to review. If you meet one of these lender’s eligibility criteria, you may be approved and have your loan funded in a matter of days.

Your origination fee — the amount deducted from your loan before you receive your funds — is based on Prosper’s evaluation of your financial background. This is included in your APR, which is the total interest and fees you’ll pay for your loan.

All Prosper loans are underwritten by WebBank, a Utah-chartered Industrial Bank.

What can a personal loan through Prosper be used for?

Prosper personal loans are unsecured, so provided you’re using it for a legal purpose, you can apply your funds to just about any expense.

  • Debt consolidation. Take out a loan to pay off your personal loan and credit card debt, potentially with more favorable rates and terms to help you save on interest or make repayments more affordable.
  • Small business needs. Small business owners struggling to qualify for a business loan — especially startups — can cover those costs with a personal loan from Prosper.
  • Home improvement. You can use funds from a prosper personal loan for a variety of home improvement projects including repairs, remodeling, adding new furniture or buying new appliances.
  • Special occasion. Instead of financing those big life moments with a credit card, you may be able to score lower rates with a personal loan from Prosper, making it easier to afford special occasions such as milestone birthdays, weddings and vacations.

Prosper Healthcare Lending

Prosper offers financing to help cover medical expenses in the form of term loans with fixed monthly repayments. To be eligible for this loan, you must have a healthcare provider that is enrolled with Prosper and offers financing options. If your provider doesn’t, contact Prosper to find an eligible medical practice in your area.

Prosper offers two programs for different financing needs and creditworthiness:

StandardExceptional
Loan amount$2,000–$35,000$20,000–$100,000
APR6.95%–35.99%5.99%–15.59%
Recommended credit score640740
SpeedA few daysA few days

The application is fairly straightforward for both. First, check your rates by filling out a preliminary form that allows Prosper to do a soft credit pull that won’t affect your score. If you decide to finalize your application, your standard application will be reviewed by underwriting software. The exceptional application will be reviewed by a live loan officer.

What are the benefits of a personal loan through Prosper?

  • Varied loan amounts. Prosper lets you borrow any amount from $2,000 to $40,000.
  • No prepayment penalties. You can choose to make additional payments at any time without paying additional fees.
  • Online account management. You can track the progress of your loan at any time by logging into the Prosper online account management system.
  • Quick turnaround. Once you submit your application, you may be able to receive your funds within five days of accepting your loan offer.
  • Flexible loan terms. You can choose between either 3 or 5 year loan term.

Drawbacks to consider

  • Origination fee. Prosper’s APR includes an origination fee of between 2.41% and 5% of your loan amount, which it deducts from your loan amount before you receive your funds.
  • Late fees. If you’re late on a payment, you might have to pay a late fee of $15 or 5% of the amount due, an insufficient funds fee of $15 or a check processing fee if you opt to pay by paper check.
  • APR based on credit score. Your APR will depend highly on your credit score. Those with excellent scores will benefit from an APR of 6.95%, while those with less-than-perfect credit may have to pay up to 35.99%.

What borrowers are saying about Prosper on Trustpilot

Prosper has received a rating of “Great” on Trustpilot with 7.3 out of 10, across 49 reviews.

Prosper loan Trustpilot image

Is applying for a personal loan through Prosper safe?

Prosper works hard to keep your data safe. Its loans are legit and are underwritten by WebBank, member FDIC. On top of that, Prosper is rated A+ with the Better Business Bureau (BBB), has many positive ratings from TrustPilot and is an equal housing lender.

Prosper stores all its borrowers’ sensitive personal and financial information in highly secure state-of-the-art data centers that make use of the latest in web filtering, anti-spam, antivirus, VPN and firewall technologies. The website makes use of automatic session timeouts to minimize the risk of unauthorized access to your account, and you can use TRUSTe’s Dispute Resolution System to submit feedback or questions regarding Prosper’s privacy policy.

What do customers say about Prosper?

As of July 2018, Prosper doesn’t do very well when it comes to online reviews. Only 11 out of the 49 reviews on its BBB page are positive and nearly 200 customers have filed a complaint against the BBB. It also scores a low 6 out of 10 on Trustpilot, based on 50 reviews.

Several customers had trouble with the application. Some were unhappy that they weren’t approved for the amount they had prequalified for. Others were suspected they’d been denied based on inaccurate information, such as a lower income or credit score. Many also didn’t qualify for the rate they expected.

But not all had bad experiences. Many were happy with how quick and painless the application process was. And a couple mentioned that Prosper was key to becoming debt-free.

What eligibility criteria will I need to meet?

To apply, you have to meet the following eligibility criteria:

  • A credit score of at least 640 (Prosper uses TransUnion to obtain credit scores)
  • A Social Security number
  • A bank account
  • Regular income
  • Debt‐to‐income ratio below 50%
  • No bankruptcies filed within the last 12 months
  • Fewer than 7 credit bureau inquiries within the last 6 months
  • Minimum of 3 open accounts reported on your credit report
  • Not a resident of Iowa, North Dakota or West Virginia

How to apply

You can apply for a personal loan through Prosper by clicking the Go to Site button on this page to be directed to Prosper’s website. The application is completely transparent, and you can check your rate with a simple one-page form.

Prosper loan apply image

Completing the application requires you to provide the following information:

  • Your name, home address and email address
  • Your date of birth and tax file number
  • A valid form of ID like a driver’s license or a passport
  • Your employment status, employer’s name and employer’s contact details
  • Details about your income

Investing in loans through Prosper

If you’re interested in investing, funding loans through peer-to-peer lending may be a viable option. With Prosper you can invest as little as $25 in a loan, allowing you to diversify your investments further.

When you invest with Prosper, you get to choose the loans you want to invest in. There is a clear rating system provided, which ranges from AA (low risk) to HR (higher risk). The lower risk loans will have lower returns, and vice versa.

With estimated returns of 8.04% on average, Prosper has a platform with successful investors and an easy-to-use system that puts you in control. If you’re ready to invest with Prosper, simply click “Go to Site”, head over to the “Invest” tab, and sign up. Any monthly returns you earn will be deposited directly into your account.

Bottom line

Founded in 2006, Prosper is one of the top sites for peer-to-peer loans. Although you’ll need to meet more stringent eligibility criteria in order to qualify, you can look forward to lower rates and decently high loan amounts from Prosper’s investors. If you don’t meet the base criteria or want to compare more lender, you can check out other personal loan options before applying.

Frequently asked questions

Important information

For example, a three-year $10,000 loan with a Prosper Rating of AA would have an interest rate of 5.31% and a 2.41% origination fee for an annual percentage rate (APR) of 6.95% APR. You would receive $9,759 and make 36 scheduled monthly payments of $301.10. A five-year $10,000 loan with a Prosper Rating of A would have an interest rate of 8.39% and a 5.00% origination fee with a 10.59% APR. You would receive $9,500 and make 60 scheduled monthly payments of $204.64. Origination fees vary between 2.41%-5%. APRs through Prosper range from 6.95% (AA) to 35.99% (HR) for first-time borrowers, with the lowest rates for the most creditworthy borrowers. Eligibility for loans up to $40,000 depends on the information provided by the applicant in the application form. Eligibility is not guaranteed, and requires that a sufficient number of investors commit funds to your account and that you meet credit and other conditions. Refer to Borrower Registration Agreement for details and all terms and conditions. All loans made by WebBank, member FDIC.

Personal loan ratings

★★★★★ — Excellent

★★★★★ — Good

★★★★★ — Average

★★★★★ — Subpar

★★★★★ — Poor

We analyze top personal loan providers and rate them one to five stars based on factors that are most important to you. These factors include: rates and fees, customer reviews, loan amounts, loan processing and borrower experience.

Read the full methodology of how we rate personal loan providers.

Aliyyah Camp

Aliyyah Camp is a publisher for finder.com helping folks compare personal, student, car and business loans. When she's not helping people with their personal finances, you can find her going for runs outdoors.

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4 Responses

  1. Default Gravatar
    ScepticalLadyJune 18, 2018

    Why does Prosper need my BANK SIGN-IN and PASSWORD?

    • finder Customer Care
      nikkiangcoJune 19, 2018Staff

      Hi ScepticalLady,

      Thanks for visiting finder.

      Generally, applying for a loan requires you to create an account with them and that includes your username and password.

      Also, in completing the application requires you to provide the following information:

      Your name, home address and email address
      Your date of birth and tax file number
      A valid form of ID like a driver’s license or a passport
      Your employment status, employer’s name and employer’s contact details
      Details about your income

      It is also imperative that you check your credit score as an application to any lenders will appear in your credit file.

      Hope this clarifies.

      Regards,
      Nikki

  2. Default Gravatar
    LubnaMay 28, 2018

    Do you accept co signers?

    • finder Customer Care
      joelmarceloMay 29, 2018Staff

      Hi Lubna,

      Thanks for leaving a question on finder.

      There is no information whether they accept cosigners to get better chances and be approved for a loan. You can ask them directly by going HERE. If you looking for lenders who accepts cosigners for personal loans, please go HERE.

      Cheers,
      Joel

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