Prosper Loans Review
Prosper, called the “loans marketplace”, is a peer-to-peer lending network where you can both:
- Invest in loans to other members
- Borrow money from Prosper’s network of lenders
Essentially, Prosper takes the bank out of the lending equation. As borrowers repay loans, investors earn back their principal plus interest of seven, 11, even 13 percent, depending on the risk of the loans they fund.
For example, I applied for a Prosper loan three years ago to consolidate $11,500 of high-interest credit card debt. My loan was funded (and is now paid-in-full), saving me over three percent on interest. With credit cards raising APRs above 20 percent and banks only paying a paltry one percent on savings accounts, I firmly believe that peer-to-peer lending is the financial future.
How to Borrow on Prosper
You may borrow between $1,000 and $25,000 on Prosper for any reason. All loans have 36-month (three year) terms and no prepayment penalty. It’s fast and free to create a Prosper loan application online; your interest rate will be determined by your credit, income, and the number of investors bidding on your loan (the more investors that compete to lend you money, the lower your rate will go).
Create a free borrower application on Prosper now
How to Lend on Prosper
Investing in peer-to-peer loans is the perfect alternative to (or compliment to) parking cash in low-return savings accounts or CDs. You only need $25 to start investing, and you’ll even receive a $50 sign-up bonus and cash rebates on the funds you invest. You can hand-pick how much to invest in individual loans, or invest in a pre-packaged note that is diversified over several different quality loans.
