Prosper Personal Loans

4.5 out of 5

Funded by: Prosper Funding

At A Glance

Prosper offers unsecured personal loans when you have a minimum 640 credit score. It's possible to change your payment due date, and the repayment terms are competitive with most lenders. You receive your loan funds after investors fund your request.

Pros & Cons

Pros

  • Competitive rates and fees
  • Can change monthly due date in most cases
  • Single monthly payment
  • Joint loans are available

Cons

  • Investors have up to 14 days to fund your loan request
  • The minimum credit score is higher than some lenders
  • Funding isn’t guaranteed after Prosper approves your application

Prosper Personal Loans Borrowers Qualifications

Annual income

No annual income requirement to apply

Credit history

At least 2 years

Credit score

630

Bankruptcy

No recent bankruptcy or delinquencies

State eligibility

Prosper is available to borrowers in all states

Prosper Personal Loans Key Details

Loan amount

Up to $40,000

Loan term

3 or 5 years

Estimated APR

7.95 – 35.99%

Approval time

As fast as 24 hours

Time to funds

As little as 5 days

Fees
  • Origination fee: Between 2.41% – 5%
  • Late payment fee: $15 or 5% of the unpaid amount (whichever is greater)
  • Insufficient funds fee: $15
Pre-payment option

Prepayment option available

Credit inquiry

Soft credit check

Prosper Personal Loans Review

Our Experts Take
Josh Patoka - Spade Business Team
Josh Patoka
November 11, 2020

Prosper personal loans can be used for most general purposes, with loans between $2,000 and $40,000. Current interest rates range between 7.95% and 35.99% APR with a 3 or 5-year repayment with fixed monthly payments. Borrowers must have a minimum 640 personal credit score, a debt-to-income ratio below 50%, and at least 3 open trade lines on the credit report.

Prosper isn’t a bank, so the loan funding process can take longer as individual investors buy loan notes. Investors have up to 14 days to fully fund a loan request once a borrower accepts the offer. However, most borrowers receive their loan funds within 5 days after accepting a loan offer. Prosper also charges a reasonable 2.41% to 5% origination fee on each loan. You can pay off your loan early without paying a prepayment penalty.

Where Prosper Stands Out

Competitive interest rates: Interest rates start at 7.95% APR. This rate is competitive with traditional banks. In some cases, the rate can be lower than a traditional bank for well-qualified borrowers. Moreover, you have either a 3 or 5-year repayment term, which can be longer than a traditional bank personal loan. You can get a free rate quote, and Prosper won’t request a hard credit pull until you accept a firm loan offer.

No minimum income requirement: Prosper doesn’t require an annual minimum income to apply, although the average applicant has an $88,500 annual income. Your income can determine your borrowing limit and interest rate. Plus, it would be best if you had a debt-to-income ratio below 50% to qualify for a Prosper loan.

No prepayment penalties: You can repay your loan early without a prepayment penalty. Because Prosper charges annualized interest, repaying your loan early waives any remaining interest charges.

Single monthly payment: Alternative lenders may require daily or weekly payments. Prosper only collects one monthly payment, which can be easier to afford if you have a tight budget and other recurring expenses.

Where Prosper Falls Short

May take 5 days to receive funds: On average, it takes 5 days for Prosper to fund and disburse loan funds, although it can take up to 14 days. Other lenders may offer personal loans with next-day funding, but your interest rate and origination fee might be higher than those offered by Prosper.

Funding not guaranteed: Prosper relies on individual investors to fund loan requests. If a loan isn’t fully funded in 14 days, the loan offer is canceled, and you must reapply. Borrowers with strong creditworthiness shouldn’t have an issue receiving full funding.

Origination fee up to 5%: All borrowers pay an origination fee between 2.41 and 5%. The exact rate depends on the borrower’s credit rating. Prosper deducts this fee from the starting loan amount. Origination fees are standard with personal loans, and this fee is competitive with other lenders.

Minimum 640 credit score required: Applicants must have a minimum 640 credit score to apply. This is higher than other lenders but Prosper has flexible qualifications regarding annual income and debt-to-income ratios. They don’t analyze business revenues when using a personal loan for business purposes either.

Is Prosper The Best Option For Me?

Prosper is a solid option when your personal credit score is at least 640, and your current debt-to-income ratio is below 50%. Starting interest rates are competitive with traditional banks. Even less qualified borrowers may find it easier to qualify for a Prosper loan with a lower interest rate than a traditional bank.

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