Prosper Review

Pros

• The application process is fast and easy
• No prepayment penalties
• Customer service is helpful
• Low credit score requirements

Cons

• Some additional fees are charged
• Funds can take a while to disburse

What Is Prosper?

Founded in 2005, Prosper is at the forefront of the online lending movement. The company only offers personal loans, but these loans can be used for business purposes. Because the underwriters are taking your personal creditworthiness into account (as opposed to that of your business), personal loans can be ideal for startups that don’t meet the requirements of business loans.

Borrowers are generally satisfied with Prosper, although there are a few frustrations to keep in mind. Lower borrowing limits, additional fees, and potentially high rates prevent Prosper from earning a perfect score in our review. However, new business owners, borrowers with less-than-perfect credit, and borrowers who can score good terms and fees may benefit from a Prosper loan.

Services Offered By Prosper

Prosper offers personal loans up to $50,000 that can be used for business purposes.

Prosper has also recently added the Prosper Card, a credit card with an initial limit up to $3,000.

While funding options and borrowing amounts are limited, Prosper’s funding products may be suitable for businesses that don’t meet the traditional requirements for a small business loan and may find exactly what they’re looking for.

We also like that Prosper has an easy-to-use mobile app that allows you to estimate loan payments, apply for a new loan, or manage your existing loan.

Borrower Qualifications

These are the loan requirements you need to meet to get a Prosper personal loan:

Because creditworthiness is based entirely on you and not on your business, Prosper does not require a certain amount of time in business or revenue.

Instead, Prosper will look at your personal creditworthiness and financials. In addition to having a credit score of 600 or above, you need to have:

• A source of income
• No bankruptcies in the last year

If you don’t meet these requirements on your own (or you want to qualify for a higher borrowing amount), you may add a co-borrower to your application. Note that the co-borrower must meet all requirements outlined above.

Rates & Fees

These are the terms & fees for Prosper’s loans:

Prosper’s loans are traditional, fixed-term installment loans. That is, you will pay a set amount each month until the principal and accrued interest have been repaid. Repayments are made every month.

The lender charges an origination fee, which is deducted from your principal before Prosper sends the loan to you. Otherwise, borrowers may incur fees for late or failed payments or paying by check but for no other reasons (such as repaying their loan early).

Application Process

The application process is performed completely online.

To begin the process, you’ll be required to check your rate. This involves creating an account and entering basic information about yourself. Prosper will use this information to determine if you’re eligible for a loan and, if so, what terms and fees it can offer you. This step does not affect your credit.

If you choose to continue the process, you will have to fill out a more detailed application. When your application is complete, your profile will be made available on Prosper’s marketplace for funding. Prosper will also run a hard credit check at this point (which will affect your credit) and perform other steps to verify your information.

Once your loan offer is accepted, you may receive funds as quickly as the next business day, although bank processing times and other factors may affect this timeline.

Sales & Advertising Transparency

Although you can find information on Prosper’s personal loan terms & fees in small print at the bottom of the homepage (other information is available if you dig through the help center), I’d like to see a more prominent disclosure of Prosper’s rates & fees for an easy comparison of loan options and a more thorough rundown of what to expect during the application process.

In addition to Prosper’s website, it also maintains social media accounts that are updated frequently.

Customer Service & Technical Support

Prosper has a very in-depth help center — one capable of answering all your basic questions and more.

If your question is not answered there, or if you encounter a technical error, Prosper is available by phone. If you are a Prosper borrower or you’ve recently submitted an application, email support is available.

Prosper also has a company blog, various calculators, and social media profiles on Facebook, X/Twitter, LinkedIn, and Instagram.

Most current customers are happy with the level of support provided. Overall, reviewers say that customer service is knowledgeable and helpful. However, some have had frustrating experiences when trying to sort out technical problems or get ahold of a specific representative — something we’ll explore in the next section.

User Reviews

Prosper is a mixed bag when it comes to reviews. It’s also important to remember that some of the complaints have come from investors and not borrowers. The company receives an A rating from the BBB, where it has been accredited since 2012. It also has closed over 150 complaints in the last year.

The lender fares much better on Trustpilot, where it holds a rating of 4.6 out of 5 (based on 13,000+ reviews), as well as on Credit Karma, where its rating is 4.7 out of 5 (based on 3,100+ reviews).

Negative Reviews & Complaints

Most reviews on the borrower side tend to revolve around the same problems:

• Denial After Pre-Approval: Getting a letter stating that you’ve been “pre-approved” is merely a marketing tactic. Once Prosper gathers more information about your situation, the company might find that you do not meet its underwriting standards. You won’t officially have your approval until your information has been verified and your loan funded by investors.
• Expensive Rates & Fees: Some customers felt that their interest rate or origination fee was too high.
• Inability To Change Due Dates: Currently, your monthly payments are due on the day your loan originated. If you received your loan on the 15th of January, your monthly due date is going to be the 15th of every month until you’ve paid off your loan. This can be less than convenient for some people, depending upon when or how they get their income.
• Technical Errors: Some customers have reported problems with Prosper’s application, whether it’s because they had to submit documents multiple times, the auto-withdrawal system malfunctioned, or something else. Occasionally the issues are due to borrower error, but sometimes it’s a fault in Prosper’s systems.
• Customer Service Problems: Some customers have reported having difficulty getting in contact with customer service representatives for verification calls or other problems that arise during the application and borrowing process.

Positive Reviews & Testimonials

Prosper has some positive reviews on the BBB as well as on other sites. Here’s what reviewers like about Prosper:

• Quick application process
• Transparent advertising
• Helpful customer service
• Automatic repayments
• Competitive interest rates (for borrowers with solid credit profiles)

Final Verdict: Is Prosper Worth It?

As far as personal loans for business, Prosper gets it (mostly) right, earning an overall rating of 4.1 out of 5 stars in this review.

Prosper loans are easy to apply for and to pay off, barring minor technical or verification problems. You’ll never be surprised by hidden fees or other unexpected clauses, although we wish that terms, fees, and other specific details were more prominent on the Prosper website. With loans topping out at $50,000, Prosper also isn’t ideal for businesses that need a large amount of capital. 

Merchants with the absolute best credit scores benefit from getting low interest rates. You may be able to get better rates if you go to a bank, and those with the inclination and ability should certainly do so. On the other hand, due to the streamlined application process, Prosper has the potential to save you valuable time and effort.

For qualified entrepreneurs who can’t yet get a loan based on the strength of their businesses, Prosper is also worth considering.

Unsure if Prosper is right for you? Check out our top picks for personal loans for business.

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