Prosper Loans: 2021 Personal Loan Review

Prosper is an online peer-to-peer lending platform that offers personal loans to fair- and good-credit borrowers.

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Our Take

3.5

NerdWallet rating 

The bottom line:

Prosper's platform gives borrowers access to a wide range of loan amounts, but funding can take a few days.

Prosper

on Prosper's website

on Prosper's website

Min. Credit Score

600

Est. APR

7.95-35.99%

Loan Amount

$2,000-$40,000

Pros & Cons

Pros

  • Option to change your payment date.
  • Offers joint loans.
  • Offers wide range of loan amounts.

Cons

  • No rate discount for autopay.
  • Funding time can be longer than many lenders.
  • Charges origination and late fees.
  • Borrowers can choose from only two repayment term options.

Compare to Other Lenders

Prosper
Lending Club
Payoff
NerdWallet rating 
NerdWallet rating 
NerdWallet rating 
Est. APR

7.95-35.99%

Est. APR

7.04-35.89%

Est. APR

5.99-24.99%

Loan Term

3 to 5 years

Loan Term

3 to 5 years

Loan Term

2 to 5 years

Loan Amount

$2,000-$40,000

Loan Amount

$1,000-$40,000

Loan Amount

$5,000-$40,000

Min. Credit Score

600

Min. Credit Score

600

Min. Credit Score

600

Compare estimated rates from multiple lenders

Compare Rates

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Full Review

Prosper is a peer-to-peer lending platform that provides personal loans to borrowers with fair or good credit.

To qualify applicants, the company uses a proprietary rating system that considers data points like credit history and debt-to-income ratio. Borrowers are then assigned a Prosper score, which investors use to decide whether to fund your loan.

Your application expires if your loan request isn’t at least 70% funded within 14 days, though the company says most loans are funded within three days.

Prosper is best for borrowers who:

  • Have fair or good credit (630 to 719 FICO) and two years of credit history.

  • Want to add a co-borrower on their application.

  • Are interested in home equity financing.

Prosper at a glance

Affordability

  • APRs are high among lenders targeting similar borrowers.

  • Charges origination and late fees.

  • No rate discount for autopayments.

Transparency

  • Soft credit check to pre-qualify.

  • Reports payments to three credit bureaus.

  • Discloses rates, fees and terms on website.

  • Offers comprehensive FAQ that answers key borrower questions.

Loan flexibility

  • Offers joint loans.

  • Allows changes to payment due date.

  • Does not offer direct payment to creditors with debt consolidation loans.

  • Not available in Iowa and West Virginia.

Customer experience

  • Offers limited customer service hours.

  • Offers financial education.

  • Does not offer a mobile app to manage loan.

Key terms to know about personal loans

Annual percentage rate is the interest rate on your loan plus all fees, calculated on an annual basis and expressed as a percentage. Use the APR to compare loan costs from multiple lenders.

An origination fee is a one-time, upfront fee that some lenders charge for processing a loan. The fee can range from 1% to 10% of the loan amount, and lenders typically deduct it from your loan proceeds.

The debt-to-income ratio divides your total monthly debt payments by your gross monthly income, giving you a percentage. Lenders use DTI — along with credit history and other factors — to evaluate a borrower's financial ability to repay a loan.

Lenders that offer pre-qualification typically do so using a soft credit check, which allows you to see rates and terms you qualify for without affecting your credit score. If you accept the loan offer, the lender will perform a hard check to confirm your information. Hard checks knock a few points off your credit score.

Where Prosper stands out

Wide range of loan amounts: Prosper provides access to loan amounts from $2,000 to $40,000, which allow borrowers to cover large and small expenses, including debt consolidation and pricey home improvement projects.

Joint loan option: Prosper's platform allows two borrowers to apply together as joint applicants. While the primary borrower must meet Prosper’s main credit criteria, the secondary borrower can qualify with a FICO score of 600, at least one open account on their credit report and no bankruptcy filings within the last 12 months.

Including a co-borrower with stronger credit can improve your chances of getting a loan or a lower annual percentage rate.

Home equity line of credit: In addition to its unsecured personal loans, Prosper offers access to a home equity line of credit for borrowers in Alabama, Arizona, California, Colorado, Florida, New Mexico and Texas. It's worth noting that the HELOC offering has different qualification requirements than the personal loan product.

With a HELOC, you borrow against the available equity in your home and use the house as collateral. HELOCs tend to have lower APRs and longer repayment terms, making monthly payments more affordable.

Compare Prosper with other loan companies:

Where Prosper falls short

Origination and late fees: Borrowers may be charged an origination fee ranging from 2.41% 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.

There is a late fee for loan payments more than 15 days past due. The fee is 5% of the monthly payment amount or $15, whichever is greater.

Limited term lengths: Borrowers can choose a three- or five-year loan repayment term. That’s somewhat common for online lenders, but it doesn’t give you the option to choose a shorter term and pay less interest, or select a longer term to lower your monthly payments.

Funding time: While next-day funding is available, most borrowers receive loan funds in three days upon loan approval, according to the company. This is a longer funding time than competing lenders.

No rate discount for autopay: Unlike some other 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 helps 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 Prosper loan

  • Minimum credit score: 600; borrower average is 722.

  • Minimum credit history: 2 years.

  • Minimum income: No minimum income requirement; borrower average is $106,000.

  • Maximum debt-to-income ratio: 50% (excluding mortgage).

  • No bankruptcies filed within the past year.

  • At least three open accounts on credit report.

  • Fewer than five credit bureau inquiries in the last six months.

  • Must be at least 18 years old.

  • Must provide Social Security number and a U.S. bank account.

Loan example: A five-year, $15,000 loan with a 15.5% APR would cost $361 in monthly payments. You’d pay $6,660 in total interest on that loan.

How to get a Prosper loan

Pre-qualify on NerdWallet

NerdWallet recommends comparing loans to find the best rate for you. Click the button below to pre-qualify on NerdWallet. You may receive personalized rates from multiple lenders that partner with us, including Prosper. Pre-qualifying will not impact your credit.

Apply on Prosper

You can fill out an application on Prosper’s website. After entering your personal information, you’ll be presented with loan options for which you pre-qualify.

on Prosper's website

Personal Loans Rating Methodology

NerdWallet’s review process evaluates and rates personal loan products from more than 30 lenders. 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 our editorial guidelines.

Frequently asked questions