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Prosper Debt Consolidation

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LAST UPDATED: May 24th, 2022

Prosper started in 2005 and is America's first peer-to-peer lending marketplace. The San Francisco-based company has over 2 million members and over $6 billion in funded loans. Because Prosper is not a bank, people invest in each other. Borrowers can list loan requests from $2,000 to $35,000. An individual lender can invest as little as $25 with each loan they select. The company is currently run by CEO Aaron Vermut.

Customers can enjoy loans from Prosper that help with debt consolidation, home improvements, baby and adoption, small businesses, special occasions, and auto and vehicles. However, customers with a low credit score could potentially have a very high interest rate.

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The Good

  • Easy Application Process
  • Prosper's Debt Consolidation Loan
  • Prosper Daily App

Easy Application Process

Prosper provides loans that can help with a variety of circumstances, one being debt consolidation. Signing up is quick, easy, and consists of the following steps:

  1. Provide basic information
  2. Check rates and review the loan options

The loan will originate and be deposited into one's bank account once an investor commits funds for the loan From there, monthly payments are fixed and automatically deducted from one's bank account. Because interest rates for Prosper's debt consolidation loans are fixed, a borrower's interest rate will never change after the loan is processed (even if one misses a payment). Prosper only handles unsecured debt and does not require collateral.

A borrower can get their loan fast if they submit the application and all required documents quickly. It is possible to get 100 percent funded within 24 hours.

Prosper's Debt Consolidation Loan

A borrower with high interest rates can consolidate all of their loans into one debt consolidation loan with Prosper.

The Prosper marketplace is not a big bank and is known for providing affordable rates. One can check their rate online, a feature that does not affect one's credit score. Dozens of investors work collaboratively to fund posted loans.

On average, borrowers get a rate 5 percent better than their credit card, leading to thousands of saved dollars. A borrower can choose between a fixed three-year loan term and a fixed five-year loan term, with no hidden fees or prepayment penalties.

Loans range from $2,000 to $35,000. Prosper's electronic payment system is easy to use and lets the borrower manage their entire consolidation loan directly.

Prosper Daily App

Prosper offers a convenient mobile app for both IOS and Android. The app makes it convenient to get a loan for debt consolidation, and allows customers the following features:

  • Financial account and loans can all be viewed from one place
  • The app shows where all of one's money is going
  • Customers can tracks their credit score, right from the app

The Bad

  • No Consolidation Services
  • Fees
  • Strict Eligibility
  • Not Accredited

No Consolidation Services

The company uses a loan to help people through debt consolidation and does not actually provide debt consolidation services, or a debt consolidation program.


It is important to be aware of a few Prosper fees. Borrowers have to pay a $15 fee for a failed payment due to insufficient funds, or a closed or changed account. Interest rates for consolidation loans at Prosper Debt Consolidation are around 2.41 to 5 percent. 

For monthly payments that are 15 or more days late, borrowers must pay 5 percent of the unpaid installment amount or $15 dollars-depending on which is greater. Prosper does not retain the fees, and they are passed on to lenders.

Strict Eligibility

One of Prosper's most frustrating aspects is getting approved. It is difficult to do so, since requirements are strict. The company prefers people with high-paying jobs, and credit scores must be at least 640 to be considered. Even with a good credit score and salaried position, eligibility is not guaranteed since investors must still choose to commit funds to one's account.

Not Accredited

The company does not seem to hold any debt consolidation organization accreditations, like ISO, FCAA, or NFCC. 


The Bottom Line

Prosper is a peer-to-peer lending marketplace that provides loans for a variety of different purposes. Many use Prosper to help with debt consolidation. The loan application process is simple. However, Prosper is not well accredited and does charge late fees. People with low credit scores could potentially end up with a high interest rate. On top of that, it is hard to get approved with Prosper's strict eligibility requirements. Prosper may be worth exploring for people with a decent salary, and a great credit score. Otherwise, we recommend looking into other more accredited companies that offer a consolidation program or consolidation services.

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Noa Ranoa San Diego, CA

I used Prosper years ago. I was stuck thinking about bankruptcy but I went with consolidation. I didn't regret it. My monthly was way lower and I had money to tuck into an emergency fund. Prosper was easy and Fast!

2 years ago