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Prosper

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Prosper Funding LLC, also known as Prosper Marketplace, Inc., gives borrowers access to collateral-free, personal loans at low, fixed rates. In 2005, it was the first online lending marketplace to launch in the United States. Based in San Francisco, Prosper is not a traditional banking institution. As a peer-to-peer lending platform, the platform connects investors to borrowers. 

All Prosper loans are made by WebBank, an FDIC-insured bank based in Utah. This is the same lending institution that also funds personal loans for other lending sites, including Upgrade, Lending Club, and Avant. 

The Prosper platform has funded over $15 billion in personal loans and offers people the investment opportunities. Through Prosper, consumers with good credit can get a personal loan from $2,000 to $40,000 to help with a variety of life’s expenses:

  • Adoption expenses
  • Boat, car, motorcycle, or RV purchase or repairs
  • Debt consolidation 
  • Home remodeling
  • Medical or dental bills
  • Special occasion expenses
  • Taxes
  • Vacation
  • Any other large purchase

This lender has a few borrower requirements that consumers should be aware of: 

  • Minimum credit score – 640
  • Max debt-to-income ratio – 50%
  • Income greater than $0
  • No recent bankruptcies (12 months)
  • Less than 5 credit bureau inquiries in the last 6 months
  • Minimum open trades on credit report – 3

Consumers can even check their rate by entering basic information, without a hard credit pull, so it won’t affect their credit score. However, to borrow, you need to have a bank account, social security number. 

With an easy online application, no hidden fees or prepayment penalties, Prosper is a smart way to get the money you need and improve your financial well-being. 

Keep reading our Prosper personal loan review for pros and cons, plus consumer reviews.

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The Good

  • Easy Application Process
  • Competitive Interest Rates
  • No Prepayment Penalty
  • Prosper Rating System
  • Grace Period
  • Payment Options

Easy Application Process

The Prosper personal loan application is fast and simple. On the Prosper website, enter the amount of money you wish to take out (between $2,000 and $40,000). Next, provide the purpose of your loan, your name, address, employment status, individual yearly income, date of birth, email address, and create a password for your account. Select the box at the bottom of the page confirming your electronic signature and then click "View Your Offers." 

If approved, the following page will show you potential personal loan options to choose from. After selecting the desired loan amount and other related terms, Prosper may request additional verification documents. 

If you aren’t approved, you are referred to AmOne, a personal loan matching service that connects borrowers and lenders, and doesn’t require such high credit standards. 

From start to finish, if your loan application is approved, you should receive your loan money within seven days via direct deposit into your bank account. Keep in mind that the average funding time is five days. 

Competitive Interest Rates

Loan amounts vary between $2,000 and $40,000, with loan terms varying between three and five years. 

For applicants with a good credit history, Prosper offers competitive interest rates. Its annual percentage rate (APR) range is between 6.95 percent and 35.99 percent, with more qualified applicants being issued personal loans with rates closer to 10 percent. 

If you are wanting to get a lower rate, try applying for a smaller loan and having a shorter loan term. 

No Prepayment Penalty

There is also no penalty for paying off your loan early. This can save you a lot of money when if you are able to repay your loan early. 

Prosper Rating System

This lending platform uses a proprietary rating system. It assigns a letter grade to express the expected level of risk to Prosper investors. Rates and repayment terms improve for borrowers with better Prosper Ratings. 

Grace Period

If your monthly payment isn’t made in full within 15 calendar days of your due date, then you are charged a late fee. 

Payment Options

To make your monthly payments, you have several options: 

  • Autopay
  • Check
  • Online
  • Phone

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The Bad

  • Not Ideal for Subprime Applicants
  • Fees Apply
  • Loan Charge-Offs
  • Borrower States

Not Ideal for Subprime Applicants

Being approved by Prosper can be challenging for applicants with less-than-perfect credit. While Prosper advertises a minimum credit score requirement of 640 in order to apply, this score may not always be high enough to get you approved. 

Prosper takes into account different factors when approving borrowers. These factors include, but are not limited to, credit score, annual income, state of residency, and how many lines of credit an applicant has open. 

Below is a description of the average Prosper personal loan borrower:

  • Average credit score is 703
  • Average annual individual income is $83,000
  • Minimum of three open lines of credit
  • Debt-to-income ratio under 50% (excluding mortgage)

These averages don't always describe applicants who are looking to borrow money to consolidate debt or make a home improvement purchase. Prosper personal loans are better suited for those with prime credit and good credit history.

Fees Apply

There are several fees that prospective borrowers should be aware of:

  • Origination fee – 2.4%–5% of the amount you borrow 
  • Check processing fee – $5 or 5% of your payment (whichever is less)
  • Late fees – $15 or 5% of the payment amount (whichever is greater)
  • Insufficient funds charge – $15

The fee rate assigned depends on the grade the borrower has been given based on financial standing. 

Note: The origination fee is included in your quoted APR. 

Loan Charge-Offs

If your loan payment is more than 120 days late, it will be charged-off and can be sent to collections. If your loan is charged-off, you can’t borrow from this lending company again and your delinquincy will be reported to the credit bureaus. 

Borrower States

Prosper’s unsecured loans are not available to people in two states: 

  • Iowa
  • West Virginia

Consumers living in those two states will have to look for another lender to consolidate their credit card or other loan debt.

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The Bottom Line

Although the minimum FICO score for this lender is 640, Prosper is a great personal loan choice for applicants with excellent credit. Its unsecured personal loans come with fixed rates between 6.95 and 35.99 percent and fixed terms, with the origination fee factored in. They can be used to pay off credit card debt, or for other standard personal loan needs. 

Its rates are consistent with other top personal loan companies, and its ability to have funds in the borrower's hands in under seven days is competitive; however, if you don’t meet the minimum credit requirement or have a debt-to-income ratio over 50 percent, Prosper may not be the best choice for you.

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Star Rating

3.8

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5 Reviews

Review Breakdown

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60%

4 grade

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3 grade

20%

2 grade

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1 grade

20%

Sentiment Criteria

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Van Kole Victoria, TX

I am happy with my experience with Prosper. The loan process was really quick and easy. I applied online and had a phone conversation with the representative to verify my information. Got my loan deposited in my bank account after three days. I applied for 20k loan to pay off in 36 months. I received a rate of 15% due to my credit history and credit score. I have a very high debt to income ratio and was pleased to received a 15% rate offer. With my history, I normally get offered 20+% on credit cards much more on loans, but prosper gave me the best rate I can have with my score. I am 10 months away to pay off the loan. I used the money to pay off some of my high APR credit cards and travel. Thank you, Prosper. I highly recommend this company to everyone who would like to pay down high interest credit card sooner or use the funds however you like for such a short period of time to pay it off.

3 years ago

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Glanda Widger

I have 2 loans with Prosper. They are fast, efficient and take care of the loan process quickly. Fees are average and I will use them in the future. One loan was 1 yr old when I got the second one and will be paying the original loan off in 9 months. Great company to work with.

4 years ago

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Kristen Schow Pleasant Grove, UT

I had to have an unexpected surgery, and didn't know how it was going to pay for it! I was able to get a loan through Prosper with an excellent great so fast! Highly recommend!

2 years ago

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Clayton Moore San Antonio, TX

I Have a Loan through Prosper and had no problem a Year Ago and No Questions Asked. I tried getting another Loan and they Question my income and didnt last time.. They told me i couldnt include my Spouse income .I never been later nor miss a payment in over 20 years and my Credit Score is way above 700.. This Company is a Joke.. Stay away from this loan Company.. I getting a loan thru another Company and Paying Prosper Off and not EVER going To use them. Stay Away from this Company..

1 year ago

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Tom Pleasant Grove, UT

I have used Prosper in the past, not because I wanted to, but with my credit they were a good option. The interest rates are still too high.

2 years ago

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