Prosper Loans: 2024 Personal Loan Review

Prosper is an online peer-to-peer lending platform that provides personal loans to borrowers with credit scores from bad (below 630) to excellent (720 and above).

To qualify applicants, Prosper uses a proprietary model that evaluates information like bank account transactions and ability to repay the loan. Then Prosper connects a borrower’s application with investors who can decide to fund the loan. Most approved loans are funded within a week, but some may be funded as soon as the next business day according to the company.

Prosper offers a wide range of loan terms and amounts, making it a strong option for major and minor expenses.

» MORE: Compare top personal loan lenders and rates

Table of contents

Prosper at a glance

Where personal loans through Prosper stand out and fall short

How to use Prosper personal loans

Prosper personal loan customer reviews

Do you qualify for a Prosper personal loan?

How to apply for a Prosper personal loan

Compare Prosper to other lenders

How we rate Prosper personal loans

Prosper at a glance

• Disclosure from Prosper

  You may receive your funds one business day following your acceptance of the loan offer, completion of all necessary verification steps and final approval. One business day funding is also dependent on your bank’s transaction processing speed. Personal loans through Prosper have an annual percentage rate (“APR”) of 8.99% to 35.99%, terms between two and five years, and an origination fee from 1% to 9.99%. For example, a three-year $10,000 personal loan with an interest rate of 9.38% and a 9.99% origination fee results in a 16.74% APR. You would receive $9,001.00 and make 36 scheduled monthly payments of $319.77. A five-year $10,000 personal loan with an interest rate of 11.14% and a 9.99% origination fee results in a 15.84% APR. You would receive $9,001.00 and make 60 scheduled monthly payments of $218.12. Whether you are eligible for a specific APR or loan term will depend on a number of factors, including (but not limited to) your current credit rating and information you provide in your application. The lowest rates are for the most creditworthy applicants. Your actual rate may differ. Eligibility for personal loans up to $50,000 depends on a number of factors, including (but not limited to) your financial history, credit score, monthly income, and monthly expenses. Eligibility for personal loans is not guaranteed, and requires sufficient investor commitments to fund. All personal loans made by WebBank.

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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 a week upon approval. Some lenders offer same-day funding, but it isn't uncommon to wait a couple of days.

Mobile app to manage the loan: Borrowers can apply for a loan, make payments and check their credit scores on the Prosper mobile app. The app is a convenient benefit for borrowers who manage their finances on their phone.

Hardship relief support. Prosper offers a hardship relief program that may reduce your monthly payment or extend the loan term.

» MORE: Best fair-credit personal loans

Where Prosper falls short

Origination and late fees. Borrowers may be charged an origination fee ranging from 1% to 9.99% of the loan amount. 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.

Finally, Prosper charges $5 for making a loan payment via check. It’s relatively rare for a lender to charge the borrower for making a loan payment.

» MORE: Best personal loans with no origination fee

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 payment 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.

» COMPARE: Best debt consolidation loans

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How to use Prosper personal loans

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Prosper personal loan customer reviews

As of August 2024, Prosper has 4.6 stars on Trustpilot, a website that collects consumer reviews. Customers mention the company’s fast approval process and customer service. The lender’s mobile app received 4.7 stars across more than 3,700 reviews on Google Play and 4.8 stars across more than 14,200 reviews on the Apple App Store.

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Do you qualify for a Prosper personal loan?

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. resident.

• At least 18 years old.

• Able to provide a verifiable bank account.

• Able to provide a Social Security number. 

Prosper's borrowing requirements

Here are the lender’s 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.

• Prosper's average borrower snapshot

  • Average credit score: 709.

  • Average annual income: $137,000.

  • Average loan amount: $14,927.

  • Average APR: 23.3%.

  • Most common loan term: 5 years.

  • Most common loan purposes: Debt consolidation, home improvement, household expenses, healthcare expenses, vacations and big purchases.

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How to apply for a loan through Prosper

Here are the steps to apply for a Prosper loan.

1. Pre-qualify on Prosper’s website. You’ll first enter your desired loan amount and then begin the pre-qualification process. Prosper will ask for the loan purpose and then request personal information like your name, birthdate and email address before you can preview loan offers. There’s no hard credit pull at this stage.

2. Preview loan offers and accept the one that fits your budget. If you successfully pre-qualify, Prosper will show you the potential loan amount, APR, repayment term, monthly payment and total interest payments you could have on a personal loan. The lender may show you multiple offers. Once you accept a loan offer, you’ll submit a formal personal loan application. This could require more documents, like W-2s and pay stubs, 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.

3. Make a plan to repay the loan. Prosper reports payments to all three major credit bureaus (Equifax, Experian and TransUnion) 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.

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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 qualification requirements.

LendingClub

» MORE: Read our review of LendingClub

SoFi

» MORE: Read our review of SoFi

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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:

• Personal Loan Review Category Definitions

  Affordability (25%)

  An affordable loan has low rates and fees compared to other similar loans and may offer rate discounts.

  Customer experience (20%)

  A good customer experience includes allowing borrowers to choose and change their repayment date, a fully online application process, a mobile app to manage the loan and a customer service team with wide availability.

  Underwriting and eligibility (20%)

  The lender reviews borrowers’ credit reports and credit history and tries to understand their ability to repay a loan. It offers loans in most states and doesn’t restrict eligibility by requiring a pre-existing relationship.

  Application process (20%)

  Borrowers can pre-qualify to check their potential rate, loan amount, repayment term and APR without affecting their credit score. They can easily find answers to questions about the personal loan on the lender’s website. The application process is fast enough to allow funding within a couple of days or less.

  Loan flexibility (15%)

  A flexible loan is one that offers a wide range of loan amounts and repayment term options. It includes common features like additional loan types and direct payment to creditors on debt consolidation loans.

  Discretionary

  A lender’s star rating can be reduced if the lender is sued by a state or federal regulator for unfair consumer practices or has been accused by a reputable source of suspicious business practices.

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