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Prosper is one of the first peer-to-peer lending platforms. Essentially lenders and borrowers are brought together without the need for a bank. Prosper loans are funded by multiple individuals until the total loan amount is reached. The loans are unsecured so there is no need to come up with collateral. Read our full Prosper review to see if they’d be a good fit for your next loan.
Prosper Quick Info
| APR Range | 5.99% - 36% |
| Loan Amounts | $2,000 - $35,000 |
| Average Loan | $12,774 |
| Origination Fee | 1% - 5% |
| Loan Duration | 3 - 5 Years |
| Time to Fund | 3 - 5 Business Days |
| Soft Credit Check? | Yes |
Who is the Typical Prosper Borrower?
- They have a good credit score. The average Prosper borrower has a 710 credit score and the minimum allowed is 640.
- They have a high income. While there is no technical minimum the average Prosper borrower has a household income of $86,400.
- They have a low debt-to-income ratio. While the maximum is 50% (excluding mortgage) the average Prosper borrower’s is much lower.
- They want to use a money management app. Prosper has a great app to keep track of not just your loan but your spending in general. They also offer free credit score monitoring.
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Prosper Review
Prosper started in 2005, just a little bit before their main peer-to-peer rival Lending Club. They work in the same way, investors fund your loan not Prosper. But for you as the borrower, the process doesn’t change all that much.
The first thing you’ll do is fill out a short application with some personal information and reason for the loan. If you’re approved you’ll be assigned a Prosper Rating (ranging from best to worst – AA, A, B, C, D, E and HR) and you can create your loan listing. You’ll select the amount of the loan you’re seeking between $2,000 and $35,000. You will also select the term of the loan of 3 or 5 years.
You will also be able to write a description of your reasons for the loan, financial information, and any other items that will make your potential loan appealing to lenders browsing the listings.
The lenders will be able to see all of this information plus relevant data from your credit reports. Don’t worry, all of your personal information is removed leaving only anonymous financial information. In fact, the whole process is anonymous, real names and financial information are never revealed to borrowers or lenders on the website. Prosper handles the transaction and personal data.
My Loan Is Listed Now What?
Now that your loan listing is live hopefully lenders will begin funding it. If you find that your loan is not attracting much funding you may want to consider changing a few things. A better description or a more appealing title may help. Prosper’s blog has tips on attracting funding.
I’ve Got Funding, What Happens Next?
Now your loan will go into review by Prosper. They may request a variety of documents to verify your identity, address, and income. This protects the lenders and Prosper loans from handing out money to people who aren’t who they say they are. You’ll have 7 days to provide the requested documents.
Once everything is checked and approved the money will be automatically deposited into your bank account. This usually takes up to 3 days. The amount will be your funded loan amount minus Proper’s loan origination fee. The fee depends on your score which I have listed below.
One month after you receive your loan you will start your payments. Each month your bank account will be debited the agreed payment amount until the loan is paid back.
Visit Prosper to Apply
How Does Prosper Compare?
Prosper and Lending Club are very similar but there are a few differences. Prosper loans start at $2,000 instead of $1,000 and their max is $35,000 instead of $40,000.
Lending Club is a bit more flexible than Prosper. With Lending Club they will work with you if you’re having trouble making payments or you need to change your payment schedule. Prosper not so much. You can also bring a co-signer with Lending Club.
We really liked the free money management app called Prosper Daily. You can track your accounts and monitor your credit score. They also have an identity protection service for $9.99/month or $6.99/month if you pay for a year upfront. It’s a service similar to LifeLock.
Prosper Reviews From Around the Web
| Better Business Bureau |  4.1/5 - 29 Reviews |
| Credit Karma |  4.5/5 - 330 Reviews |
| Nerd Wallet |  4/5 |
Prosper Fees and Penalties
- Origination fee: 1% to 5% of the loan amount, based on borrower’s grade
- Prepayment fee: None
- Late fee: 5% of payment due or $15, whichever is greater
- Check processing fee: None
- Declined payment fee: $15
Business Contact and Profile for Prosper
| Name: | Prosper |
| Phone: | (415) 593-5400 |
| Address: | 221 Main St Fl 3 - San Francisco, CA 94105-1911 |
| Website: | Prosper.com |
| Business Started: | 2005 |
| Type of Business: | Financial Services, Peer-to-Peer Lending |
| Principal: | Mr. Aaron Vermut, CEO |
| BBB Accreditation: | This organization is a BBB accredited business - A+ rating |
