Personal Loans » Personal Loan Lender Reviews » Prosper Personal Loan Review 2022: What To know Before Apply
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Prosper Personal Loan Review 2023: What To know Before Apply

Prosper marketplace is a great place to start in your personal loan search. Here's how do they work, what it can be used for and some pros & cons.
Author: Baruch Mann (Silvermann)
Baruch Mann (Silvermann)

Writer, Contributor

Experience

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor, which helps consumers make better financial decisions.  Silvermann’s areas of expertise include investing, banking, and credit cards. Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more. Aside from being a finance expert, his background includes working as a business and financial analyst. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.

Review & Fact Check: Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Financial Expert, The Smart Investor CEO

Experience

Baruch Mann (Silvermann) is a financial expert and founder of The Smart Investor. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.
Author: Baruch Mann (Silvermann)
Baruch Mann (Silvermann)

Writer, Contributor

Experience

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor, which helps consumers make better financial decisions.  Silvermann’s areas of expertise include investing, banking, and credit cards. Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more. Aside from being a finance expert, his background includes working as a business and financial analyst. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.

Review & Fact Check: Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Financial Expert, The Smart Investor CEO

Experience

Baruch Mann (Silvermann) is a financial expert and founder of The Smart Investor. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.

We earn a commission from our partner links on this page. It doesn't affect the integrity of our unbiased, independent editorial staff. Transparency is a core value for us, read our advertiser disclosure and how we make money.

prosper logo

On Credible Website

Prosper is the first peer-to-peer lending marketplace, offers personal loans for a wide variety of purposes and to a large market of borrowers. 

APR

7.99% - 35.99%

Loan Amount

2,000 - $40,000

Term

36-60 Months

Min score

600

Prosper is the first peer-to-peer lending marketplace, offers personal loans for a wide variety of purposes and to a large market of borrowers.

prosper logo

APR

7.99% - 35.99%

Loan Amount

2,000 - $40,000

Term

36-60 Months

Min score

600

On Credible Website

Known as the first peer-to-peer lending marketplace in the United States, Prosper was founded in 2005. The way it works is that borrowers apply online for a fixed-term loan for anywhere between 2,000 - $40,000 . Prosper accepts a wide range of borrowers and members are allowed to take out more than one loan at a time. They offer competitive rates and, use soft pull inquiries, and they offer a business loan too.

If your credit score is at least 600 and you like the idea of individuals coming together, this lender may be the best option for you.  Compared to other lenders for borrowers with fair credit, the required score is average. For example, the Upstart required score is 600 while Upgrade minimum score is 620 .

While this option may seem utopic, there’s a downside to a peer-to-peer loans. Relying on someone to back your loan could mean potentially waiting a long time for your loan to get serviced. You may get to a point where nobody funds it at all, which is inconvenient no matter what reason you need the money. Along with this, Prosper isn’t available in every state and they do charge an origination fee for their services.

  • Competitive Interest Rates
  • More than One Loan
  • Peer to peer
  • Business Use
  • Service Wide Range of Borrowers
  • Soft Pull Inquiry
  • No Prepayment Penalty
  • No Joint Borrowers
  • Potentially Long Turn Around times
  • Potential to Go Unfunded
  • Origination Fee
  • Not Available in All States

Does Prosper offer prequalification? 

Yes, Prosper has a five step process to obtain your rate and become prequalified. This process should only take two minutes and only uses a soft credit check, so it will not impact your credit score.

Prosper will only initiate a hard credit check if you decide that you would like to go ahead with your loan application.

Can I add a cosigner to Prosper personal loan?

Prosper does allow joint applications, so it is possible to add a co-borrower to your application to increase your chances of approval. However, the status of the co-borrower is important, as marital spouses or relations have the greatest success in increasing approval.

The key difference between a co-borrower and a co-signer is that with a co-signer, they have financial responsibility to ensure the loan is repaid, but they cannot access the loan funds. In the case of co-borrowers, both parties are responsible for making payments and both have access to the loan funds.

Can I pay off a Prosper loan early?

Yes, Prosper does not charge any prepayment penalties if you want to pay off your loan before the end of the loan term.

You can use the online account dashboard to access your loan payout quote at any time, so you can have an up to date figure to make an informed financial decision.

Can I negotiate with Prosper?

If you are having financial difficulties or your financial circumstances have changed, it is worth trying to negotiate with Prosper. However, there are no guarantees that Prosper will negotiate with you over the settlement figure.

 

In this Review..

Customer Experience

The Prosper customer service team is available Monday through Friday during regular business hours, with no weekend phone support. You can also send an email to Prosper's borrowing team in addition to calling them.

You have access to a help center as well as a financial education program. The Prosper mobile app does not allow you to manage your personal loan. Finally, Prosper has an A+ rating with the Better Business Bureau.

Prosper got 840 out of 1000 possible points in the J.D power 2020 research, lower than industry average. 

Prosper
iOS App Score
4.7
Android App Score
3.9
BBB Rating
A+
WalletHub Rating
2.6
TrustPilot
4.5
Contact Options
phone
Availability
9 am – 8 pm (ET)

Propser Loan Pros & Cons

As we know, each lender has its own pros & cons  – here are the relevant things we found for potential borrowers:

Prosper’s interest rates are competitive for borrowers with good credit histories and a strong cash flow.

The borrower can get multiple loans at a time from Prosper.

The Prosper platform matches up borrowers with investors. Many borrowers like knowing that their payments and some interest go back to lenders who are everyday people.

Prosper allows for borrowers to use their personal loans for business use. Other lenders do not allow for personal loans to be used for business.

Prosper works with all types of borrowers, from prime to those with poor credit. They also have a wide range of rates.

Prosper allows for an initial soft pull inquiry so the borrower can get an idea of the options for which they may qualify.

The borrower can pay off the loan early without any fees.

Prosper does not allow for joint borrowers.

It can take up to 14 days to fund your loan and then a few days after to send your money. If you need money more quickly, there are other providers that can turn around your application much faster.

There is a possibility that your approved loan might end up not being funded. If investors do not want to invest in your loan, you will not be able to move forward.

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Prosper deducts a one-time origination fee of 2.4 to 5.00% (link) of your loan amount directly from your loan funds. This should be considered in the pricing of your loan when you apply.

Prosper does not operate in Maine, Iowa, and North Dakota.

What Can a Prosper Personal Loan Be Used For?

Prosper loans can be used for debt consolidation, home improvement, short-term and bridge loans, car purchases, baby expenses and adoption costs, engagement rings, small business costs, military loans, green loans, and special occasions

  • Home Improvement – A Prosper home improvement loan is for home repairs or projects.  The advantage of using a Prosper home improvement loan is the promptness of receiving the funds.  
  • Debt Consolidation – Prosper debt consolidation is paying off one or more prior unsecured loans with the new Prosper loan. Instead of multiple payments to multiple lenders you can create one payment to one lender.  The advantage of a debt consolidation loan with Prosper is that the payment and term are fixed so you know exactly when you’ll be out of debt. 
  • Car Purchase – Prosper allows their personal loans to be used for car purchases without using the car as collateral. Many times car loans are cheaper but if you are unable to get credit, Prosper may be a good option. Because many lenders require that the car be used as collateral, they will limit the type of car you can get. 
  • New Baby or Adoption Fees – A Prosper loan for baby and adoption can be used to help manage medical bills for a new baby or legal bills for adoption. The cost of living increases when you have an addition to your family and a Prosper loan can help cover those costs
  • Green Loans – Prosper green loans are home improvement products that help your home become more energy efficient and environmentally friendly. Many green projects can cost a lot upfront but will help you save money, in the long run, every month on your energy costs. 
  • Business Loans – Prosper allows personal loans to be used for business use. Many other lenders only allow this type of loan for personal use.  The loan can be used to purchase inventory, fund payroll, or pay for any other general business needs.

How to Apply For Prosper Personal Loan?

The application process is a little different with Prosper because you not only apply but also create a profile for potential investors to evaluate you as a risk and accordingly lend you money for a portion of the loan. You being the process by checking your rate through a soft pull.

Prosper Personal Loan

Prosper will ask you some basic information and give you a couple of rate and loan options. Then you will need to provide more information so Prosper can do a hard pull or credit check. 

Prosper Personal Loan

This is where they will get the information they need to give you your rate. You will create a quick profile explaining why you need the loan. 

Prosper Personal Loan

Your listing will then be posted on Prosper’s marketplace for up to 14 days where investors will look at your profile and decide whether to invest in your loan. Many listings do not stay up for the entire 14 days.

Prosper Personal Loan

After your loan is funded, Prosper may ask you for some verification information, such as state ID, social security card, and income. You will sign documents electronically for the loan and then the funds will be sent to your bank. It could take a few days after funding for Prosper to deposit the money in your account.

Prosper Personal Loan

When Prosper Shines?

Prosper is a peer-to-peer online lending platform that caters to borrowers who have fair or good credit scores. It offers a good range of loan amounts and it has a lower barrier to entry than many other online lenders. It has been in business since 2005 and has provided personal loans to more than one million people.

Prosper personal loan can be a good fit if:

prosper logo
prosper logo

Prosper FAQs

Prosper is a peer-to-peer lender offering personal loans to those with good or fair credit. However, the company uses more than your credit score to determine if you qualify. The criteria include your credit history and debt to income ratio.

Prosper is also a good option if you are interested in using a co-borrower on your application, which some lenders don’t allow. If you're still not sure, you can always keep comparing personal loan lenders or take a look at our best personal loans for fair credit.

Prosper does require applicant income verification, so you will need to provide documents such as bank statements, recent pay stubs or tax returns. Additionally, in some cases, Prosper may contact your employer or use other databases to confirm your employment status.

RocketLoans offers loans with a fast turnaround. If approved, you can expect to receive the funding the same business day. The RocketLoans starting APR is similar to Prosper and the maximum loan amount is also similar. However, you can expect to pay an origination fee of as much as 6%.

So, if you have a fair or good credit score and are looking for quick cash, Rocket Loans could be a better option

In the past, Citibank actually purchased Prosper loans, which may leave you thinking that the two entities are one in the same. However, this is not the case. Citibank's maximum loan amount has a higher t, yet its rates are lower and  Citibank has no established minimum credit score.

To qualify for a Citibank personal loan, you do need to be an existing customer. So, if you already have a Citibank account, it is likely to offer a better deal than Prosper.

Is Lending Club better than Prosper?

Prosper is very similar to Lending Club in that you need a credit score of 630+ to qualify and it takes approximately one week to process your application. However, Prosper does require an additional one to three business days to issue the funds. So, if you’re looking for quicker access to the money, Lending Club is a better option.

Lending Club has no late fees, Prosper does not charge anything if you want to pay off your loan early and the late fees are the same.

One area where Prosper stands apart from Lending Club is that it is open to borrowers with a high debt to income ratio of up to 50%, whereas Lending Club’s maximum is 40%.

Peer to Peer Personal Loans: Alternatives

payoff logo svg

Upstart logo

APR Range The annual percentage rate (APR) is the total annual cost of borrowing money. This rate includes the interest rate as well as any additional finance charges. When you take out a personal loan, for example, you may be required to pay loan origination fees.
8.99%-29.99%
7.99% – 35.99%
5.60% – 35.99%
Term The term of your loan is the amount of time you have to repay it. For example, if you get a 24 months personal loan, the loan term is 24 months.
24 – 60 months
36-60 Months
36-60 Months
Loan Amount
$5,000 – $40,000
2,000 – $40,000
$1,000 – $50,000
Minimum Score
600
600
$12,000
Funding Time
2-5 days
Up to 14 days and then 1 to 3 days to deposit
1-2 Days

Review Personal Loan Top Lenders

Compare Alternative Lenders

SoFi is widely regarded as the best option for people with excellent credit who require larger loan sizes while paying low fees. Prosper is best suited to people with low credit scores, whereas FIGURE is best suited to people who want quick and easy access to funds.

Read Full Comparison: FIGURE Vs SoFi Vs Prosper: Which Personal Loan Is Better?

All of these lenders have some things in common, such as similar credit score requirements. There are, however, some significant differences that you will notice.

Prosper is a great option for people looking for a small loan, whereas Payoff is better suited to applicants looking to minimize fees. Finally, if you want to get very competitive rates, Peerform is a good option.

Read Full Comparison: Peerform vs Payoff vs Prosper: Which Personal Loan Is Better?

In many ways, Prosper and LendingClub are very similar. They are both peer-to-peer lending marketplaces that require a minimum credit score of 600 and offer the same term lengths. They also have flexible repayment options and a fee structure that is similar to ours. Even the APR rates and fee structures are very similar, so there isn't much to differentiate these two products.

Read Full Comparison: Prosper vs LendingClub: Which Personal Loan Is Better?

Each of these three lenders shares and differs in some ways. In general, Upstart is the best option for people who need a small loan or who may not be able to obtain a FICO score. Rocket Loans is a viable option if you need quick access to borrowed funds, whereas Prosper allows you to get a joint loan and caters to people with fair credit.

Read Full Comparison: Rocketloans Vs Prosper Vs Upstart: Which Personal Loan Is Best?

When it comes to these various lenders, Marcus is clearly the leader. It has the best reputation, no fees, and a lot of flexibility when it comes to repayments. However, the funding process can be a little slow. Prosper offers a wide range of repayment options and accepts lower credit scores, whereas Best Egg provides secured loans and preferable debt consolidation options.

Read Full Comparison: Best Egg Vs Prosper Vs Marcus: Choose The Right Personal Loan For You

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Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor, which helps consumers make better financial decisions.  Silvermann's areas of expertise include investing, banking, and credit cards. Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more. Aside from being a finance expert, his background includes working as a business and financial analyst. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.
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Loan Reviews Methodology

When it comes to choosing personal, student or car loans, we make sure that we evaluate all of the different products and services that are available for the lender we review. 

The Smart Investor’s selection of loan providers for inclusion here was made based on key areas we evaluated: loan types and loan products offered, fees, and APR. We also considering customer satisfaction and reliable external ratings such as J.D power/Trustpilot.

Cutting fees is now table stakes in the personal and student loans market. In addition, the most valuable loan products tend to offer a deep bench of options that meet a wide array of customer needs. These include a diverse range of loan amounts and terms, as well as loan structures. We also make sure that you’re going to save money by cutting down on the APR that goes along with the loans offered.