Prosper

Prosper is a San-Francisco based lending service that provides peer-to-peer personal loans for multiple reasons, including debt consolidation, auto loans, or home improvement. Since its founding in 2005, their investors have funded around $9.7 billion in loans. They are backed by investors like Credit Suisse NEXT Fund, Institutional Venture Partners, Francisco Partners, and Sequoia Capital.

If you are interested in Prosper’s loans, they require the following criteria to be approved:

• You must have a good to excellent credit score. The minimum credit score required is 640, although the average customer has a score of 710.
• You must have a high steady income. The average Prosper borrower has an income of $89,000.
• You must have a debt-to-income ratio under 50%, excluding your mortgage.
• You need to have an established credit history of at least two years. The average borrower has 11 years of credit history.
• You cannot have any recent bankruptcies.

To apply, you must submit your social security number and documentation regarding your income, pay stubs, and tax return.

After you are approved as a potential borrower, Prosper assigns you a rating that is based on your credit history, debt-to-income, and other financial information to assign you a grade that tells investors the potential risk of your loan. This grade determines your interest rate, origination fee, and allows investors to decide if they want to invest in you.

Your loan is then listed on the marketplace, which allows investors to decide if they want to contribute $25 or up to your entire loan amount. Your listing shows potential investors your credit history, loan purpose, city, and state. Your name and other personal information is withheld, so this process is completely anonymous. Most investors’ profiles have a preference set to a certain risk grade and these profiles may automatically choose your loan if you have the matching criteria.

You have access to an online account which allows you to see your application status, any documentation you need, and the percentage of funds that have been contributed to your loan. If you wait more than a couple of days, you are more likely to receive the best rates from interested lenders. It usually takes a few days to have your loans at least 70% funded, and you can begin receiving your funds after all your information is verified.

Once your loan is approved, your funds will arrive via a direct deposit to your bank account within one to three business days.

Contact Prosper:

Phone: 866-615-6319 Hours: Monday through Friday 8 am to 9 pm ET, 5 am to 6 pm PT Saturday 9 am to 5:30 pm ET, 6 am ti 2:30 pm PT Address: Prosper Funding LLC 221 Main Street, Suite 300 San Francisco, CA 94105

Prosper Pros

• Prosper currently holds an A+ accreditation from the BBB (Better Business Bureau).
• If you pay your bills on time, you can potentially build your credit since Prosper reports to all three credit bureaus.

Prosper Cons

• Loans from Prosper don’t have the same flexibility as some of the other online lenders. For example, you will not be able to adjust your payment date.

Prosper Pricing

• You can borrow anywhere from $2,000 to $40,000.
• Interest rates range from 5.99% to 35.99%.
• You make monthly payments for a repayment periods that ranges from 3 to 5 years.
• Prosper loans have an origination fee of 1% to 5%, which is deducted from your loan amount.
• Late fees are either $15 or 5% of the payment amount, whichever is greater.
• There is an unsuccessful payment fee of $15.
• There are no personal check processing fees.
• You can make payments through the recommended method of autopay, or you can make payments by phone, online, or by check.

Summary

Prosper is an accredited peer-to-peer loan marketplace that caters their loans to borrowers with good to excellent credit. Their loans are funded by interested investors, which allows you to shop around for the best interest rates.