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Prosper Loans: The Ebay of Lending
by Lisa Phillips
March 2008
by Lisa Phillips
March 2008
Getting a Prosper Loan
To get a loan, borrowers must create a loan listing detailing your
loan request. You decide how much you want to borrow ($100 to
$25,000) and you choose the maximum interest rate you are willing
to pay. People who lend bid down the interest rate. Prosper takes
the bids with the lowest interest rates and turns these bids into one
loan.
Prosper then handles all loan administration tasks including loan
repayment and collections on behalf of the matched borrower and
lenders, throughout the life of the loan. You may post a picture or
you may remain anonymous. It is best to include as much detail as
To get a loan, borrowers must create a loan listing detailing your
loan request. You decide how much you want to borrow ($100 to
$25,000) and you choose the maximum interest rate you are willing
to pay. People who lend bid down the interest rate. Prosper takes
the bids with the lowest interest rates and turns these bids into one
loan.
Prosper then handles all loan administration tasks including loan
repayment and collections on behalf of the matched borrower and
lenders, throughout the life of the loan. You may post a picture or
you may remain anonymous. It is best to include as much detail as
More Social Lending Resources
Lending Club
Brings together lenders and borrowers to
lend money among themselves at
competitive interest rates.
Zopa Loans
A Social Lending Network
Virgin Money
Manage Your Loans Between Friends and
Family.
Lending Club
Brings together lenders and borrowers to
lend money among themselves at
competitive interest rates.
Zopa Loans
A Social Lending Network
Virgin Money
Manage Your Loans Between Friends and
Family.
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Prosper.com is a website where borrowers and lenders meet. It
was created to make consumer lending more financially and
socially rewarding.
was created to make consumer lending more financially and
socially rewarding.
The vision for Prosper was "an
eBay for loans". Instead of
having to borrow at whatever
rate is available from
mainstream banking institutions,
you can get your loan request
bid on by several lenders.
Those lenders may be other
consumers or companies
looking to get a good return on
their investment.
eBay for loans". Instead of
having to borrow at whatever
rate is available from
mainstream banking institutions,
you can get your loan request
bid on by several lenders.
Those lenders may be other
consumers or companies
looking to get a good return on
their investment.
possible when creating your listing and let potential lenders know how you intend to use the loan
proceeds.
Lenders on Prosper
Prosper loans are funded by one or more individuals. Lenders can come from a variety of
sources. Many of the lenders spread their risk by offering small loans to multiple borrowers. You
may never know who your lender is because you’ll have little to no interaction with them.
Even though your loan may be funded by many lenders, Prosper handles all transactions as one
loan. You repay your loan directly through Prosper.com. Prosper will automatically debit your
bank on the monthly due date and the loans are repaid over three years. There are no pre-
payment penalties and the loan can be paid off at any time during term of the loan.
Qualifying for a Prosper Loan
When you request a loan, Prosper.com gathers some information about you. They will check
your credit and verify your identity. Lenders see a "credit grade" (along with some other
information) that helps them decide whether or not to lend to you. If you have a poor credit
grade, it will be harder to get a loan - or you may need to pay a higher interest rate. A minimum
credit score of 520 is required.
Prosper Interest Rates
The interest rate is fixed for the life of the loan and does not change in the event of late payment
or for any other reason. You determine your interest rates; however, it really depends on your
credit scores. The interest rates may range from very low up to 30% or more. The catch is if you
have bad credit, you may not get many loan offers at a lower interest rate. Bad credit borrowers
are more likely to get funded if they choose higher interest rates.
Prosper Loan Fees
Prosper generates revenue by collecting a one-time 1% to 3% fee on funded loans from
borrowers, and assessing a 0% to 1% per annum loan servicing fee to lenders.
For more information visit: www.prosper.com
proceeds.
Lenders on Prosper
Prosper loans are funded by one or more individuals. Lenders can come from a variety of
sources. Many of the lenders spread their risk by offering small loans to multiple borrowers. You
may never know who your lender is because you’ll have little to no interaction with them.
Even though your loan may be funded by many lenders, Prosper handles all transactions as one
loan. You repay your loan directly through Prosper.com. Prosper will automatically debit your
bank on the monthly due date and the loans are repaid over three years. There are no pre-
payment penalties and the loan can be paid off at any time during term of the loan.
Qualifying for a Prosper Loan
When you request a loan, Prosper.com gathers some information about you. They will check
your credit and verify your identity. Lenders see a "credit grade" (along with some other
information) that helps them decide whether or not to lend to you. If you have a poor credit
grade, it will be harder to get a loan - or you may need to pay a higher interest rate. A minimum
credit score of 520 is required.
Prosper Interest Rates
The interest rate is fixed for the life of the loan and does not change in the event of late payment
or for any other reason. You determine your interest rates; however, it really depends on your
credit scores. The interest rates may range from very low up to 30% or more. The catch is if you
have bad credit, you may not get many loan offers at a lower interest rate. Bad credit borrowers
are more likely to get funded if they choose higher interest rates.
Prosper Loan Fees
Prosper generates revenue by collecting a one-time 1% to 3% fee on funded loans from
borrowers, and assessing a 0% to 1% per annum loan servicing fee to lenders.
For more information visit: www.prosper.com