Prosper Loans: 2023 Personal Loan Review
Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.
Our Take
4.5
The bottom line:
Prosper's platform gives borrowers access to a wide range of loan amounts and terms. Funding can take up to a few days.
Full Review
on NerdWallet's secure website
Pros & Cons
Pros
- Instant approval.
- Option to change your payment date.
- Joint loan option.
- Wide range of loan amounts.
Cons
- No rate discounts.
- Origination and late fees.
- No direct payment to creditors with debt consolidation loans.
Get more smart money moves — straight to your inbox
Become a NerdWallet member, and we’ll send you tailored articles we think you’ll love.
Full Review of Prosper
Prosper is a lending platform that provides personal loans to borrowers with fair or good credit.
To qualify applicants, Prosper uses a proprietary rating system that considers data points like credit history and debt-to-income ratio. Then, a prospective borrower is assigned a Prosper score, which investors use to decide whether to fund the loan.
Your application expires if your loan request isn’t at least 70% funded within 14 days, though most loans are funded within three days, according to the company.
Table of contents
Prosper at a glance
Minimum credit score | 560. |
APR | 6.99% - 35.99%. |
Fees | Origination: 1% to 5%. Late payment: 5% of monthly payment or $15, whichever is greater. Insufficient funds: $15. Pay by mail: $5. |
Loan amount | $2,000 to $50,000. |
Repayment terms | 2 to 5 years. |
Time to fund after approval | 1 to 3 business days. |
Loan availability | Loans not available in IA, WV or U.S. territories. |
» COMPARE: Personal loans for good credit
Where Prosper stands out
Joint loan option. Prosper's platform allows two borrowers to apply together as joint applicants. Including a co-borrower with stronger credit can improve your chances of getting a loan or a lower annual percentage rate.
Fast funding. Prosper says next-day funding may be available for approved borrowers, and most receive loan funds within three days upon loan approval. While some lenders offer same-day funding, one to three days isn't uncommon.
Wide range of loan amounts. Prosper provides access to loan amounts from $2,000 to $50,000, which allows borrowers to cover large and small expenses, including debt consolidation and pricey home improvement projects.
Home equity line of credit. In addition to its unsecured personal loans, Prosper offers a variable-rate home equity line of credit, or HELOC, for borrowers in some states. The maximum credit amount is $500,000, and Prosper says applicants may receive funding within weeks.
» MORE: Best fair-credit lenders
Compare Prosper with other loan companies
Where Prosper falls short
Origination and late fees. Borrowers may be charged an origination fee ranging from 1% to 5%. Many online lenders charge an origination fee that can skim a few hundred to a few thousand dollars off the loan amount once approved.
Loan payments more than 15 days past due will draw a late fee, which is 5% of the monthly payment amount or $15, whichever is greater.
No rate discount for autopay. Unlike some lenders, Prosper does not offer an additional rate discount for setting up autopay. The discount usually ranges from 0.25 to 0.5 percentage points and motivates borrowers to pay on time.
No direct payments to creditors. Prosper does not send your loan proceeds directly to creditors when you consolidate debts with a loan. Instead, borrowers have to keep track of their own repayments.
How to qualify for a loan through Prosper
Most lenders have basic requirements to apply, and some have financial requirements or recommendations to qualify. To apply for a personal loan through Prosper, you must be:
A U.S. citizen or permanent resident.
At least 18 years old.
Able to provide a verifiable bank account.
Able to provide a Social Security number.
Here are the lender’s minimum requirements to qualify for a loan. (Meeting these requirements doesn’t guarantee approval.)
Minimum credit score: 560.
Minimum credit history: None.
Maximum debt-to-income ratio: 50%, excluding mortgage.
Minimum annual income: None; this lender accepts income from alimony, retirement, child support, Social Security payments and other sources.
Here are details about Prosper’s average borrower, according to the lender:
Average credit score: 685.
Average annual income: $86,000.
Average loan amount: $10,445.
Average APR: 18.9%.
Most common loan term: 3 years.
Most common loan purposes: Debt consolidation and home improvement.
Before you apply
Check your credit. You can get your free credit report on NerdWallet or at AnnualCreditReport.com. Doing so will help you spot any errors and fix them before you apply.
Calculate your monthly payments. Use a personal loan calculator to determine what APR and repayment term you’d need to get a loan with affordable monthly payments.
Make a plan to repay the loan. Review your budget to see how the loan’s monthly payments will affect your cash flow. If you have to cut other expenses to repay the loan, it’s better to know that before you borrow.
Gather your documents. Prosper requires proof of income, which can be a W-2 or paystub, as well as proof of address and a Social Security number. Having these documents handy can speed the application process.
How to apply for a loan through Prosper
Here are the steps to apply for a Prosper loan.
Pre-qualify on Prosper’s website. You’ll be asked how much you want to borrow and what the funds are for as well as personal information like your name, birthday and address. Then, Prosper will ask for information about your income, employment and whether you own your home before you can preview loan offers. There’s no hard credit pull at this stage.
Preview loan offers and accept the one that fits your budget. Once you accept a loan offer, you’ll submit a formal personal loan application. This could require more documents, like W-2s, pay stubs and bank statements, to confirm the information you gave during pre-qualification. Prosper will also do a hard credit check when you apply, so your credit score could temporarily dip.
Make a plan to repay the loan. Prosper reports payment to all three major credit bureaus, so on-time payments will help build your credit score, but missed payments will hurt it. Setting up automatic payments and watching your budget are ways to manage your loan payments.
Compare Prosper to other lenders
Personal loan lenders offer different rates, loan amounts and special features, so it pays to weigh other options. The best personal loan is usually the one with the lowest APR.
Prosper, LendingClub and SoFi are solid options for debt consolidation. But there are differences when it comes to fees and qualifying credit scores for borrowers.
Prosper vs. LendingClub
Like Prosper, LendingClub offers personal loans to fair- and good-credit borrowers. LendingClub has a rate discount on loans for debt consolidation. Prosper accepts borrowers with lower credit scores and has a wider range of loan amounts and terms.
» MORE: Read our review of LendingClub
Prosper vs. SoFi
SoFi and Prosper offer a wide range of loan amounts. SoFi offers personal loans without fees, but borrowers must have good to excellent credit to qualify. Although Prosper charges an origination fee, borrowers with lower credit scores can apply for a loan.
» MORE: Read our review of SoFi
How we rate loans through Prosper
NerdWallet writers rate lenders against a rubric that changes each year based on how personal loan products evolve. Here’s what we prioritized this year:
Category | Star rating |
|---|---|
Affordability | |
Transparency | |
Loan flexibility | |
Customer experience | |
Overall |
Ready to apply? Click the button below and head to Prosper's website to pre-qualify.
on NerdWallet's secure website
Methodology
NerdWallet’s review process evaluates and rates personal loan products from more than 35 financial institutions. We collect over 45 data points from each lender, interview company representatives and compare the lender with others that seek the same customer or offer a similar personal loan product. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.
This methodology applies only to lenders that cap interest rates at 36%, the maximum rate most financial experts and consumer advocates agree is the acceptable limit for a loan to be affordable. NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodologies for personal loans and our editorial guidelines.
Find the Best Personal Loan
Frequently asked questions
Prosper says loan approval can be instant while funding can take one to three days, depending on factors like how quickly your loan documents are received and verified.
Prosper has a minimum credit score requirement of 560. On average, Prosper borrowers' score is 685.
