Prosper Personal Loans Review 2024

Pros Explained

• Low minimum credit score requirement: Some lenders require that borrowers have good credit to qualify for a personal loan. By contrast, if your credit score is at least 600, which is considered a fair credit score, you might qualify for a personal loan with Prosper—provided you meet other eligibility requirements.
• Quick funding available: Once you qualify, accept a loan offer, and receive final approval, funds may be deposited into your bank account as soon as the next business day.
• Competitive starting APR: If you have a strong credit history and meet other eligibility, you could qualify for the lower end of Prosper’s APR range, which is lower than many lenders.

Cons Explained

• Limited repayment terms available: Prosper only offers repayment terms between two and five years. If you prefer a longer repayment period, you’ll have to choose another lender.
• Charges fees: Prosper charges an origination fee ranging from 1% to 7.99% of your total loan amount for processing your loan. This amount is deducted from your loan proceeds. In addition, if you make a late payment, you’ll be charged $15 or 5% of the loan amount, whichever is greater.
• High maximum APR: Although you might qualify for a Prosper personal loan with a fair credit score, you could end up paying an APR as high as 35.99%.

Types of Personal Loans Offered by Prosper

Prosper offers a variety of personal loans that can be used for almost any purpose, including:

• Debt consolidation
• Home improvement
• Medical expenses

However, loan funds cannot be used to pay for post-secondary education.

Debt Consolidation a Popular Reason for a Loan

According to Investopedia’s 2023 Personal Loan Borrower survey, debt consolidation is the most common reason cited for getting a personal loan. Paying for home improvements and large purchases were the next two most common reasons.

Time to Receive Funds

Prosper indicates that the loan review and approval process can take five business days. After receiving final approval, you may receive your funds in one to three business days.

Borrower Requirements

• Must be 18 years of age and live in a state where Prosper offers loans
• Must have a Social Security number
• Minimum credit score: 640 (or 600 if you have a creditworthy co-borrower)

Prosper Personal Loan Features

Pre-Qualification Option

When you pre-qualify, Prosper gives you an estimate of your rates and terms by performing a soft credit inquiry, which has zero impact on your credit score. This can be useful if you are comparing loan options with different lenders to find the best rates and terms.

Adjustable Monthly Due Date

You can change your monthly payment due date once per year if your account is in good standing by logging into your Prosper account or calling customer service. This could help you avoid making a late payment.

No Prepayment Penalty

If you choose to repay your Prosper personal loan early, you can save money on interest without incurring a prepayment penalty.

Co-Signers and Co-Applicants

Prosper allows you to apply for a personal loan with a co-borrower. Applying with a co-borrower who has strong credit could help you qualify for a personal loan at a lower interest rate.

A co-borrower is different from a co-signer. A co-signer is someone who agrees to repay a loan if you default. By contrast, a co-borrower is someone who is equally responsible for repaying the loan and shares access to the loan proceeds.

Can You Refinance a Personal Loan With Prosper?

Prosper doesn’t offer personal loan refinancing. However, you’re allowed to take out more than one personal loan with Prosper, provided that you meet these requirements:

• The total amount you borrow doesn’t exceed $50,000
• Your existing loan is current
• You’ve made six on-time payments

Customer Service

Prosper’s borrowers' service department is available by phone Monday through Saturday, or you can reach out via email.

Customer Satisfaction

Prosper’s customer reviews are largely positive. It has an excellent 4.7 out of 5 star rating on Trustpilot based on more than 12,200 reviews. Several reviewers praise Prosper’s customer service, less stringent requirements, and streamlined lending process. However, negative reviews mention challenges with the approval process and high APRs.

How to Qualify For and Apply For a Prosper Personal Loan

To qualify for a Prosper loan, you’ll need to meet certain eligibility requirements. You’ll also need to pre-qualify before submitting your full loan application online.

After completing the pre-qualification process, follow these steps to apply online:

1. Complete the online loan application: To complete your loan application, you’ll need to share your personal and financial information, such as your Social Security number, loan purpose, and loan amount.
2. Wait for Prosper to review your loan application: If supporting documents, such as pay stubs, tax returns, or bank statements, are needed, a Prosper representative will contact you.
3. Review loan terms: If you’re approved, review your loan terms and sign your loan agreement.
4. Receive your funds: Funds are typically disbursed via direct deposit within one to three business days.

Other Banking Services and Loans Offered by Prosper

In addition to personal loans, Prosper also offers:

• Home equity loans
• Home equity lines of credit
• Credit cards

Compare Prosper With Other Personal Loan Lenders

The Bottom Line

Prosper is a peer-to-peer lending platform that offers personal loans to borrowers. To qualify, you need a credit score of 600 (though 640 is recommended if you don’t have a co-borrower) or above and an annual income greater than $0. Prosper's flexible requirements make its personal loans more accessible to borrowers with less-than-stellar credit histories or minimal income. 

However, Prosper might not be the best option for everyone. It charges origination fees and late fees that can increase your borrowing costs. If you choose a lender that doesn’t charge these fees, you could potentially save money.

Also, since Prosper relies on investors to fund your loan, there’s no guarantee you’ll receive funds quickly. Some other lenders offer same-day disbursement of loan funds after approval. If you need funds quickly, Prosper may not be your best option.

How to Apply For a Personal Loan Online

When applying for an online personal loan, first see if there is a pre-qualification option. This allows you to see the rates and terms you should qualify for without impacting your credit. Once you’re ready to apply officially, have your identification and financial documents ready to upload, and follow the application instructions carefully.

What Credit Score Do You Need for a Prosper Personal Loan?

Prosper personal loans generally require a credit score of 640 or above. However, if you have a score below that (but at least 600), you can apply with a co-borrower. 

Are Prosper Loans Legitimate?

Prosper has been around for close to two decades and is one of the first and best-known peer-to-peer lenders. It has strong customer reviews and an A+ rating with the Better Business Bureau.

How Long Does It Take to Get Approved By Prosper?

Prosper approval can take up to five days. Timing varies depending on if additional documentation is needed during the application process. 

Methodology

To evaluate and rank personal loan providers we collected hundreds of data points across 70 lenders, including traditional banks, credit unions, fintechs, and special interest finance companies. We researched and evaluated APRs, loan amounts and terms, fees, customer experience, and much more. To rank the lenders in our database and to generate star ratings, we weighted the data we collected, based in part on what consumers told us were the most important features of a personal loan and lender in a survey we conducted. We grouped those factors into four broad areas:

• Loan costs (advertised APR, fees, and six other factors): 29.25%
• Loan terms (loan amount, repayment term, and three other factors): 22.25%
• Borrowing requirements (credit score, membership requirement, and six other factors): 28.5%
• Additional features (online application, pre-qualification, and eight other factors): 20%

Learn more about how we evaluated personal loans in our complete methodology.