Prosper Loans Review - Peer to Peer
Prosper.com is one of the first peer to peer
lending platforms. Essentially lenders and borrowers are brought together without the need
for a bank. Loans are funded by multiple individuals until the total loan amount is reached.
The loans are unsecured so there is no need to come up with collateral.
This Prosper Loans review will focus on the
borrower side as I have not used Prosper to lend money.
How Does a
Prosper Loan Work?
Assigning Your Prosper
The first thing that you'll do at Prosper is create and
account and provide your personal information. You'll be prompted to authorize Prosper to view your credit
report, don't worry this is a soft-pull that won't affect your credit. They on perform a hard-pull if your loan
is approved and funded. They need this to see what your credit situation is like so they can assign you
a credit grade.
Prosper uses a combination of your Experian credit score and
a custom method to determine your rating. They will then assign you a score from AA (the best) to HR (high risk).
Much like any other lender a better rating will equal a lower interest rate.
Click Here to Get Your Prosper Rating
Getting Your Prosper Loan
Once you have been assigned a Prosper Rating you
can create your loan listing. You'll select the amount of the loan you're seeking between $2,000 and $25,000.
You will also select the term of the loan, 1, 3, or 5 years.
You will also be able to write a description of your reasons
for the loan, financial information, and any other items that will make you potential loan appealing to lenders
browsing the listings.
The lenders will be able to see all of this information plus
relevant data from your credit reports. Don't worry, all of your personal information is removed leaving only
anonymous financial information. In fact the whole process is anonymous, real names and financial information
is never revealed to borrowers or lenders on the website. Prosper loans handles the transaction and personal
Below is a screenshot of what a lender will see when they are
looking at a listing.
My Loan Is Listed Now What?
Now that your loan listing is live hopefully lenders will begin funding
it. There two available methods of funding your loan currently, instant funding and
rate-auction. With instant funding as soon as the total amount of the loan is met it will be
funded. Rate-auction runs for a set period of time and lenders bid on your loan. The
rate-auction method will generally provide better rates since lenders are bidding to provide better
interest rates. It may take a bit longer but I think it is well worth
If you find that your loan is not attracting
much funding you may want to consider changing a few things. A better description or a more
appealing title may help. Prosper's blog has tips on attracting funding.
Get Your Loan Funded at Prosper.
I've Got Funding, What Happens
Now your loan will go into review by Prosper. They
may request a variety of documents to verify your identity, address, and income. This protects the
lenders and Prosper loans from handing out money to people who aren't who they say they are.
You'll have 7 days to provide the requested documents.
Once everything is checked and approved the money will
be automatically deposited into your bank account. This usually takes up to 3 days. The amount
will be your funded loan amount minus Proper's loan origination fee. The fee depends on your score which I
have listed below.
One month after you receive your loan you will start your
payments. Each month your bank account will be debited the agreed payment amount until the
loan paid back.
Prosper Loans Peer to Peer Loan
Loan amounts: $2,000 - $25,000
Borrower Interest Rates: 7.43% - 35.84%
Borrower Loan Terms - 1/3/5 Years
Rating AA - 0.5%
Rating A or B - 3.0%
Rating C to HR - 4.5%
Loans Review Overall:
experience with Prosper was a good one. I was able to take out a $2,500 loan
at a good rate.
I also found
that Prosper was easier to deal with and worked much quicker than banks I had dealt
with in the past.
> Visit Prosper Loans <
Looking to lend money
instead? Visit Prosper to Learn More.
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San Francisco, CA 94104-4545
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