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Prosper: Personal Loans Made Easy

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Do you have high interest credit card debt you’d like to consolidate? Do you want to make a few home improvements to increase your home’s value? Are you starting a business, planning a wedding, or having a baby? A personal loan can provide the cash you need to make any dream a reality, and Prosper, a peer-to-peer lending platform, can make applying for and obtaining that loan easy.

RewardExpert chatted with Sarah Cain, a Prosper spokesperson, about the company’s history, growth, and personal loan and investment opportunities.

Connecting Borrowers with Investors

“Prosper was founded in 2005 and was the first peer-to-peer lending platform in the U.S.,” Cain explained. “The company was founded on the idea that it could connect people who want to borrow money with people who want to invest in them. Fast forward 13 years later and Prosper is still connecting borrowers with individuals and institutions that want to invest in consumer credit.”

Cain said over Prosper’s 10-plus year history, the company has originated over $11 billion in loans through the platform.

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“Prosper’s mission is to advance financial well-being,” she continued. “People come to Prosper because they are looking to get access to credit at affordable rates. The personal loan product that Prosper offers can be used to refinance high-interest debt or consolidate debt into one simple payment, often at a lower rate. People also come to Prosper to borrow money for things like home improvement, medical expenses, and special occasions.”

Simple Online Application Process

Cain said that personal loans through Prosper are unsecured, have fixed terms and rates, and range between $2,000 and $35,000. Prosper’s borrowers have an average FICO score of around 710, though the minimum requirement is 640.

“A number of factors beyond FICO are also taken into account when someone applies for a loan through Prosper,” she added. “These include things like income, credit file, and debt-to-income ratio for example.”

She continued, “The application process can be completed online and is fast and simple. Once a borrower has been approved and verified, the funds from their loan are transferred directly into their account. Borrowers are charged an origination fee at the time of the loan that ranges between 1 percent and 5 percent. They can choose between a three-year and five-year repayment term, and there are no hidden fees or pre-payment penalties.”

Cain noted that personal loans through Prosper can be a good alternative to credit cards when paying for both expected and unexpected events.

“Because they are fixed-rate and fixed-term, borrowers have a line of sight as to when the loan will be paid off instead of getting stuck in a cycle of revolving debt and minimum payments,” she explained. “In addition, with credit card interest rates at an all time high, a loan through Prosper could potentially save borrowers money with a lower interest rate. The process is also typically much faster and simpler than a traditional loan. Borrowers apply online, and it typically takes one to three business days to receive the funds in their bank account.”

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Portfolio Diversification for Investors

Prosper’s platform isn’t just for borrowers, however. The company also offers investors the opportunity to diversify their portfolios beyond stocks by investing in consumer loans or a portion of a consumer loan—something that was previously only available to large institutions.

“Investors can select individual loans or use Prosper’s auto invest tool to build a targeted portfolio,” Cain said. “These investments are short duration, monthly paying assets that are attractive relative to other fixed income assets. The current return profile for investors is around 7 percent, and funds are deposited directly in the investor’s bank account each month.

Cain said Prosper’s investors include hobbyists, registered investment advisors, and sophisticated investors and institutions.

To learn more about borrowing or investing through Prosper’s peer-to-peer marketplace, visit

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