Prosper Personal Loans Review 2019

By: Heather Hanks Mar. 21, 2019

Prosper can help you save money by extending you a personal loan with a low rate and fixed terms. They offer no hidden fees and a convenient pay as you go plan. There are also no prepayment penalties. This means you can pay off your loan as quickly as you would like to save interest.

The best part is that applying won't hurt your credit. The downside is that your APR is based on your credit score. If you have less than perfect credit, then you can expect to pay higher than normal interest rates. Here's everything you need to know about Prosper personal loans and whether or not they're right for you.

prosper Personal Loans

What is Prosper Personal Loan?

Prosper is a peer-to-peer lending company that was founded in 2005. According to the company's website, Prosper has lent out more than $14 billion in loans to more than 890,000 people. The company claims that its borrowers are able to invest in a way that is socially and financially rewarding.

You can apply online for a fixed loan term of between $2,000 and $40,000 depending on your eligibility. The company states that is backed by several leading investors. These include Francisco Partners, Institutional Venture Partners, Sequoia Capital, and Credit Suisse NEXT Fund.

The company has two primary locations:

221 Main Street, #300
San Francisco, CA 94105
(866) 615-6319

4127 E Van Buren St, #100
Phoenix, AZ 85008
(866) 615-6319

They offer personal loans with loan terms that range from either three years or five years. The company promises that you will pay one fixed rate payment per month. They guarantee your rate will never go up. You can use your personal loan in any way you'd like. It can be used for loan consolidation, to pay off debt, or for major purchases. You can also use your personal loan to fund a vacation or to make home improvements. The company urges you to have a credit score of 640 to apply. They do not offer services in Iowa, North Dakota or West Virginia.

Here are some key highlights of the personal loan terms at Prosper:

Loan amounts: range from $2,000 to $40,000

You must be 18, a permanent US citizen, and live in an eligible state to quality

Must have a credit history of two years

Loan terms: range from three years to five years

You can check your rate online without affecting your credit score

Maximum debt-to-income ratio is 50%

You must have a credit score of 640 to apply

Funding time ranges from one to three business days after approval

Must have an active checking account

APRs: depend on your credit score and range from 6.95% - 35.99%

No minimum annual income required

Fixed payment dates

Research shows that the people who borrow from Prosper have an average credit score of 710. They also have an annual income of approximately $89,000. The average minimum credit history is 11 years. The maximum debt-to-income ratio is 50% excluding mortgage. Because of these averages, Prosper is ideally suited for those with good credit who make above-average wages. This shouldn't deter you from applying if you don't meet these averages. Prosper can work with you if you have less than perfect credit and make less than $89,000 per year.

The company states that they have no hidden fees, but there are several you should be aware of. First is the origination fee of 2.4% to 5%. Prosper also has a late fee of 15% or $5 of the unpaid amount, whichever is more. Finally, there is an insufficient funds fee of $15. You’ll want to make sure that you have sufficient funds in your account and make timely payments to avoid additional charges. Aside from these upfront charges, there are no hidden fees.

How Does Prosper Work?

Prosper is a peer-to-peer lending service. This means that they do not offer loans directly. Instead, they connect you to one of their investors where you will borrow directly from them. Peer to peer lending works when borrowers are connected to private investors or peers. This occurs through an online or internet-based platform such as Prosper. Investors put their money into one or more loans, and this is the funding source for your loan. Prosper is a third party company that gets the party started by facilitating the lending process. When you accept a loan through Prosper, you'll be working directly with them but their investors will be funding your loan. You can manage your account online through the process for website 24/7.

Prosper uses a risk-rating system that takes into account several different data points to determine your eligibility. Prosper is staffed with investors that make the final decision as to whether or not your loan will be funded. Your application will expire if you don't receive funds within three business days. Your origination fee of 2.4% to 5% of the loan amount will be charged upon approval of your loan. Prosper does not allow you to change your payment date. It also does not directly pay your creditors if you consolidate your loans. Prosper guarantees that you were repayment terms will never change. You can expect to pay the same monthly amount every time.

How To Apply Prosper


The application process is simple and can be done relatively quickly. Visit the company's website and answer some basic questions about yourself.

This may include your name, address, and date of birth. You may also need to input your phone number, email address, and social security number. Prosper may ask you several questions about your credit and financial history. You'll need to enter your checking account number so that the funds can be transferred once you're approved. Having all of this information on hand before you get started is beneficial. Any information that Prosper needs from you that isn't immediately provided will delay your funds.


After inputting this information, Prosper will do a soft pull on your credit.

This means that they will pull your credit report without it affecting your score. Prosper also takes into account other data when determining your eligibility and loan terms. They may want to see your financial activity in your checking account. Prosper may also check your employment status and annual income. They like to see that their borrowers are in good financial standing. Borrowers with good credit are often less of a risk to work with and will repay their loans in a timely manner. Prosper does not charge a prepayment penalty. You can pay off your loans as quickly as you'd like. Doing so can save you money in interest.


Once you enter all of your personal information into the website, Prosper will show you a list of possible loan options from their investors.

After choosing the loan you want, you’ll need to set up an account by entering the username and password of your choice. Your origination fee may vary depending on your financial background. This amount can be deducted from your loan before you receive the money. The origination fee is included in your APR and it is based on your credit history. No matter what loan option you go with, Prosper guarantees that your long-terms will not change. This means that your rates will remain the same and will not go up. You can choose from either a three-year or a five-year loan term.

Prosper uses TransUnion to obtain your credit score after you apply. You will need to meet the following criteria to be approved for a personal loan through Prosper:

  • You cannot be a resident of North Dakota, West Virginia, or Iowa
  • You must have a minimum of three open accounts reported on your credit report
  • You can have no more than seven credit bureau inquiries within the past six months on your credit report
  • Your debt to income ratio must be below 50%
  • You must have a Social Security number and regular income
  • You must have a bank account and a checking account
  • You must be active with your checking account within the past several months
  • You must be 18 years old and have proof of identity

Prosper Pros and Cons

Prosper prefers to work with customers with good financial standing and a high credit score. This is because these individuals are viewed as less of a risk. There is no minimum annual income required. The more money you make, the better your loan terms will likely be. You will also want to make sure that you have a credit score of at least 640 before applying. Prosper wants to see an active checking account with good financial behavior. They will also want to see that you have good credit history with no late fees or negative credit items.

The benefit of working with Prosper is that you can be funded as much as $40,000 with a three to five-year loan term. You can use this money however you want. Personal loans can be used to make home improvements or for vacations. You can even use it to cover rent or car troubles. The downside to working with Prosper is that you may be subject to high interest rates. This information is based on your credit history, but can also be influenced by other financial behaviors. The company has been in business since 2005, which makes it highly reputable than newer companies. However, they have stricter requirements than other lenders and it can be hard to obtain a loan through them.

Here are some of the pros and cons of working with Prosper.

Prosper PROS

  • You can borrow anywhere between $2,000 and $40,000 if you qualify
  • Loan terms range from either three-year or five year fixed rates
  • Rates will not go up no matter how long your contract is
  • Prosper will do a soft credit pull first until you are approved, and then they will do a hard credit pull
  • Once approved, your funds may become available within three business days or sooner
  • Paying off your loan quicker means fewer additional fees
  • You can manage your account online 24/7
  • Applying does not affect your credit score
  • There are no prepayment penalties
  • You can apply online within minutes
  • Healthcare loans are available

Prosper CONS

  • Most members have an average of 11 years of credit history and an annual income of $89,000 and a debt to income ratio is 50%
  • It can be very hard to qualify for a loan through Prosper
  • You must have an average credit score of 640 to apply
  • You must have a minimum of two years of credit history
  • Your APR is based on your credit score and other financial behavior
  • Origination fees candy high and are determined by your credit score
  • A late fee of $15 or 5% of your loan amount will be charged

Prosper Loans vs Other Personal Lenders

When compared to other personal loan lenders, Prosper’s terms are not as flexible. They also have stricter eligibility requirements. Other lenders allow joint loan applications and include modification plans for borrowers who have trouble making payments on time. You can also find other lenders that do not charge late fees or high origination fees. Prosper has better than average interest rates but only if your credit is good. Their requirement of a 640 credit score is high compared to other lenders. Their debt to income ratio of less than 50% is also stricter than average.

However, Prosper allows you to borrow more money with loan amounts of up to $40,000. This is higher than other lenders. They also fund your loan quickly once approved and do not have requirements when it comes to how you spend your money. They guarantee that your rates will be fixed and do not go up no matter how long your contract is. They also do not require you to have a minimum annual income. Here's how Prosper compares to other personal loan lenders.

  • Prosper: APR 6.95% - 35.99%, credit score 640, origination fee 2.4% to 5%, best for debt consolidation

  • LendingClub: APR 6.95% - 35.89%, credit score 600, origination fee 1% to 6%, ideal for borrowers with good credit

  • SoFi: APR 5.81% to 15.37%, credit score 680, no origination fee, ideal for borrowers who want flexible repayment terms

Prosper Healthcare Loans

If you need a loan to help take care of health care expenses, then you may want to look into a Prosper healthcare loan. In addition to personal loans, Prosper offers financing that helps cover medical bills. Like their personal loans, Prosper’s healthcare loans have a fixed monthly repayment option. They guarantee that their rates will not go up no matter if you take out a personal loan or a healthcare loan.

To be eligible for a healthcare loan, your healthcare provider must be enrolled with Prosper. They must also offer financing options. If your healthcare provider does not meet these qualifications, then you can contact Prosper to find a medical practitioner in your area who does. There are two different programs you can go with when you choose a Prosper healthcare loan. Both programs depend on your creditworthiness and financial needs.

Standard healthcare plans
loan amounts range from $2,000 to $35,000, APR's range from 6.95% to 35.99%, recommended credit score is 640, and you should expect to see your funds within several business days

Exceptional healthcare plan
loan amounts range from $20,000 to $100,000, APR ranges from 5.99% to 15.59%, recommended credit score is 740, and you can expect to see your funds within several business days

Applying for a Prosper healthcare loan is easy. You'll need to check your rates by filling out an online application. Prosper will do a soft credit pull on you, which will not affect your report. Underwriting software will complete your application process once you settle on a loan offer. Exceptional health care plans will be reviewed by a live loan officer due to the higher amount of money offered.

Taking out a healthcare loan can help pay off medical debt with a better interest rate so that you save money. You can also set up a monthly payment plan with your insurance company or medical provider if you're having trouble making healthcare payments.

The following is a list of additional loans that Prosper offers:

Engagement ring financing

Military loans

Special occasion loans

Debt consolidation loans

Auto and vehicle loan

Home improvement loans

Short term and bridge loans

Small business loans

Baby and adoption loans

Although Prosper does not dictate how you spend your personal loan, it's a good idea to tell them if you're using your loan for one of the above-mentioned reasons. Doing so can help get you better rates and more personalized terms.

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CreditNervana promises to keep our information as accurate and up-to-date as possible. However, you should always consult a financial advisor for specific questions about personal or business finances and investment opportunities, especially if you are looking in your area. Working with a trained professional who is familiar with your case is a safe and guaranteed way to make the best investment decision possible. Please review our terms and conditions before making any decision based on the information we provide. Financial institutions are constantly changing. Because of this, it’s a good idea to cross check the information you read here with any company you are considering working with.


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