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Personal loans play an important role in financial planning, offering individuals quick access to funds for emergencies, major purchases, or debt consolidation without the need to liquidate savings. They provide flexibility and can help maintain financial stability during unexpected situations, allowing borrowers to manage their cash flow effectively.
A comparison of Upstart vs Prosper personal loans reveals key differences in their lending models, borrower requirements, and overall benefits. Upstart utilizes artificial intelligence to assess creditworthiness, making it accessible for those with limited credit history. Conversely, Prosper operates on a peer-to-peer lending model, connecting borrowers with individual investors. Both platforms offer unique features and benefits, catering to different financial needs and borrower profiles.
In this blog, we will explore the key differences between Upstart vs Prosper, including their application processes, interest rates, fees, loan amounts, and customer reviews. Understanding these options can empower you to make informed decisions.
Upstart vs Prosper Personal Loan Overview
Upstart and Prosper are both seen as peer-to-peer lending platforms. They both offer personal loans that are funded by individual investors. Upstart was established in 2012 by former employees of Google. Prosper, on the other hand, has been around for longer since it entered the lending market way back in 2005. Upstart and Prosper these lenders limit their offerings to personal loans.
What Is Upstart Personal Loan?
Upstart is an innovative online lending platform founded in 2012 that provides personal loans ranging from $1,000 to $50,000. Unlike traditional lenders, Upstart uses artificial intelligence (AI) to evaluate borrowers based on factors such as education, employment history, and income potential, alongside credit scores. This unique approach makes Upstart a great option for individuals with limited credit histories or lower credit scores, offering accessible loans while promoting financial inclusion.
How Does Upstart Personal Loan Work?
Upstart personal loans operate entirely online, allowing borrowers to check their rates without impacting their credit score through a soft inquiry. Loan approval is quick, with decisions often made instantly, and funds can be disbursed as soon as the next business day after acceptance.
Borrowers can use these loans for various purposes, including debt consolidation, home improvements, medical bills, and more. However, repayment terms are limited to 3 or 5 years, and origination fees can range from 0% to 12%, depending on your financial profile.
What Is a Prosper Personal Loan?
Prosper, established in 2005, is America’s first peer-to-peer (P2P) lending platform, connecting borrowers directly with individual investors. It offers unsecured personal loans ranging from $2,000 to $50,000, catering to various financial needs such as debt consolidation, home improvement, and medical expenses. With a minimum credit score requirement of 560, Prosper provides opportunities for borrowers with fair credit to access funding that might otherwise be unavailable through traditional banks.
How Does a Prosper Personal Loan Work?
Prosper’s peer-to-peer lending model connects borrowers with individual investors who fund loans. Borrowers start by applying online, where Prosper evaluates creditworthiness using factors like credit score, income, and debt-to-income ratio. Once approved, investors have up to 14 days to fund at least 70% of the loan request. After funding is complete, borrowers typically receive their money within 1 to 5 business days. Prosper charges an origination fee between 1% and 9.99%, but there are no prepayment penalties, making it a flexible option for personal loans.
Upstart vs Prosper Personal Loans: A Detailed Comparison
Here’s a handy comparison table that breaks down the key features and differences between Upstart vs Prosper personal loans, making it easier for you to choose the right one based on your financial needs and preferences:
| Feature | Upstart | Prosper |
|---|---|---|
| Business Model | AI-driven lending | Peer-to-peer lending |
| Founded | 2012 | 2005 |
| Loan Amounts | $1,000 to $50,000 | $2,000 to $50,000 |
| Minimum Credit Score | 620 | 640 |
| APR Range | 6.7% | 8.99% to 35.99% |
| Origination Fees | 1% to 8% of the loan amount | 1% to 5% of the loan amount |
| Late Payment Fees | $15 or 5% of the past due amount | $15 or 5% of the past due amount |
| Prepayment Penalty | No | No |
| Funding Speed | As fast as the next business day | Within a week after final approval |
| Customer Ratings (Trustpilot) | 9.2/10 (139 reviews) | 7.3/10 (49 reviews) |
| Reputation | Accredited by BBB with A+ rating | Accredited by BBB with A rating |
Upstart vs Prosper Personal Loans: Similarities
Both Upstart and Prosper are key players in online lending, providing personal loans to borrowers seeking financial help. They simplify the borrowing process and make loans accessible to a wide range of individuals. Each platform evaluates borrowers by considering factors beyond just credit scores, such as income and financial history. Additionally, both offer competitive interest rates and flexible loan amounts, catering to various financial needs. Their user-friendly online applications allow for quick and efficient funding, making it easier for individuals to secure the money they need.
What is the Difference Between Prosper and Upstart Personal Loans?
Upstart and Prosper differ in their lending models and borrower criteria. Upstart uses AI to evaluate creditworthiness, offering loans starting at $1,000 with a minimum credit score of 620. Prosper, on the other hand, operates a peer-to-peer model, requiring a 640 credit score and offering loans from $2,000. Upstart’s APRs range from 7.40% to 29.99%, while Prosper’s range is slightly higher at 8.99% to 35.99%. These differences make Upstart ideal for borrowers with limited credit history, while Prosper appeals to those seeking investor-backed loans.
Upstart vs Prosper Personal Loans: Main Differences
| Feature | Upstart | Prosper |
|---|---|---|
| Underwriting Criteria | Credit score, income, education, employment history | Credit score and debt-to-income ratio using Prosper Score |
| Funding Sources | Banks and institutional investors | Individual investors |
| Loan Types Offered | Personal loans for various purposes | Personal loans primarily for debt consolidation |
Who is Eligible for a Loan with Upstart and Prosper?
Concerned about credit score, income, or other factors? Below are the eligibility requirements for Upstart vs Prosper, helping you understand which platform may be easier to qualify for:
Before you apply for a personal loan, it’s important to understand the basic qualifications each lender requires. Knowing whether you meet the eligibility criteria can save you time and increase your chances of approval. Here’s a side-by-side breakdown of what both Upstart and Prosper look for in a borrower:
Upstart
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You must be at least 18 years old;
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You should be a U.S. citizen or a permanent resident, excluding residents of Virginia;
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A minimum credit score of 620 is required;
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You need to have an active personal bank account in your name;
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You must have a regular, verifiable source of income.
Prosper
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You must be at least 18 years old;
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You should be a U.S. citizen or permanent resident (no state-based exceptions mentioned);
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A minimum credit score of 640 is required, slightly higher than Upstart’s requirement;
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An active personal bank account in your name is necessary;
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You must demonstrate a steady income source.
Looking at the comparison, it’s clear that Upstart and Prosper share most of the same eligibility requirements. The main difference lies in the credit score Prosper asks for a slightly higher score of at least 640, while Upstart accepts applicants with a score as low as 620. Another small difference is that Upstart doesn’t offer loans to residents of Virginia, whereas Prosper has no such restriction.
| Feature | Upstart | Prosper |
|---|---|---|
| Minimum Age | 18 years | 18 years |
| Minimum Credit Score | 620 | 660 |
| Minimum Annual Income | $12,000 | $15,000 |
| Debt-to-Income Ratio | Maximum 45%-50% (varies by state) | Maximum 50% (excluding mortgage) |
| Residency Requirement | U.S. resident | U.S. resident |
This comparison of eligibility requirements Upstart vs Prosper will give you a clear picture of what each lender looks for in potential borrowers.
Which Lender Offers Lower Interest Rates?
Wondering what the interest rate on an upstart loan? Upstart provides fixed APRs ranging from 29.99%, while Prosper rates are slightly higher, ranging from 35.99%. Factors influencing these rates include the borrower’s credit score, income level, and overall financial profile. Upstart’s unique approach considers education and job history in addition to credit scores, potentially allowing borrowers with limited credit histories to secure lower rates. On the other hand, Prosper tiered system means that borrowers with better credit profiles can access lower APRs, but those with lower scores may face higher rates.
Upstart vs Prosper: Interest Rates Comparison
| Feature | Upstart | Prosper |
|---|---|---|
| APR Range | 7.40% to 29.99% | 8.99% to 35.99% |
| Factors Influencing Rates | Credit score, income, education, job history | Credit score and debt-to-income ratio |
| Lowest Possible Rate | 7.40% | 8.99% |
Upstart vs Prosper Personal Loan: Which Lender Has Fewer Hidden Fees?
Upstart and Prosper have different fee structures, so it’s essential to compare their hidden charges. Upstart charges an origination fee ranging from 1% to 8% of the loan amount based on the borrower’s creditworthiness. Additionally, there is a late payment fee of either $15 or 5% of the overdue amount, whichever is greater. Importantly, Upstart does not impose a prepayment penalty, allowing borrowers to pay off their loans early without incurring extra costs.
Prosper, on the other hand, has lower origination fees that range from 1% to 5%, making it potentially less costly upfront. Similar to Upstart, Prosper charges a late payment fee of $15 or 5% of the unpaid amount. Like Upstart, Prosper also does not charge a prepayment penalty. Overall, while both lenders have some fees, Prosper tends to have fewer hidden costs associated with borrowing.
Upstart vs Prosper: Fees Overview
| Feature | Upstart | Prosper |
|---|---|---|
| APR Range | 7.40% to 29.99% | 8.99% to 35.99% |
| Factors Influencing Rates | Credit score, income, education, job history | Credit score and debt-to-income ratio |
| Lowest Possible Rate | 7.40% | 8.99% |
| Origination Fees | 1% to 8% | 1% to 5% |
| Late Payment Fees | $15 or 5% of overdue amount | $15 or 5% of overdue amount |
| Prepayment Penalty | No | No |
Which Lender Offers More Flexible Repayment: Upstart or Prosper?
Upstart and Prosper both offer flexible loan amounts and repayment terms, but they cater to slightly different borrower needs. Upstart provides loans ranging from $1,000 to $50,000, making it ideal for those seeking smaller loan amounts. Its repayment terms are fixed at 3 or 5 years, offering simplicity in planning.
Prosper, on the other hand, offers loans between $2,000 and $50,000 with repayment terms also ranging from 3 to 5 years. While both lenders allow early repayment without penalties, Upstart’s lower minimum loan amount may appeal to borrowers needing smaller sums.
Upstart vs Prosper Personal Loan Comparison
| Feature | Upstart | Prosper |
|---|---|---|
| APR Range | 7.40% to 29.99% | 8.99% to 35.99% |
| Factors Influencing Rates | Credit score, income, education, job history | Credit score and debt-to-income ratio |
| Lowest Possible Rate | 7.40% | 8.99% |
| Origination Fees | 1% to 8% | 1% to 5% |
| Late Payment Fees | $15 or 5% of overdue amount | $15 or 5% of overdue amount |
| Prepayment Penalty | No | No |
| Minimum Loan Amount | $1,000 | $2,000 |
| Maximum Loan Amount | $50,000 | $50,000 |
| Repayment Terms | 3 or 5 years | 3 or 5 years |
This comparison highlights the flexibility of both lenders while emphasizing Upstart’s suitability for smaller loan needs.
Upstart vs Prosper: Which Lender Has a Faster Application Process?
The application process for both Upstart and Prosper is designed to be quick and user-friendly, but they each have their own nuances.
Upstart application process: It begins with a simple online form where applicants provide personal and financial information. This initial step takes just a few minutes, and borrowers can check their potential rates without affecting their credit score. Once the application is submitted, Upstart reviews it and typically provides a decision within a few days. If approved, funds can be disbursed as quickly as the next business day.
Prosper application process: It starts with an online form, requiring personal and financial details. After the initial application, Prosper assigns a rating that influences the interest rate offered. This process can take about 15 minutes if all information is readily available. Once the loan is fully funded by investors—typically within 14 days—borrowers can receive their funds shortly thereafter.
In terms of speed, both lenders offer competitive turnaround times, with Upstart potentially providing faster funding after approval.
Upstart and Prosper Loan Application Comparison
| Feature | Upstart | Prosper |
|---|---|---|
| APR Range | 7.40% to 29.99% | 8.99% to 35.99% |
| Factors Influencing Rates | Credit score, income, education, job history | Credit score and debt-to-income ratio |
| Lowest Possible Rate | 7.40% | 8.99% |
| Origination Fees | 1% to 8% | 1% to 5% |
| Late Payment Fees | $15 or 5% of overdue amount | $15 or 5% of overdue amount |
| Prepayment Penalty | No | No |
| Minimum Loan Amount | $1,000 | $2,000 |
| Maximum Loan Amount | $50,000 | $50,000 |
| Repayment Terms | 3 or 5 years | 3 or 5 years |
| Application Time | A few minutes | About 15 minutes |
| Decision Time | Typically within a few days | Final loan contract in up to 7 days |
| Funding Speed | As fast as the next business day | Funds disbursed shortly after funding |
| Pre-approval Check | Yes (no hard pull) | Yes (no hard pull) |
Upstart vs Prosper Customer Reviews: Which is better?
Upstart Reviews: Upstart generally receives higher ratings compared to Prosper. On platforms like Trustpilot, Upstart boasts an impressive score of around 9.2 out of 10, with many users praising its fast application process and transparent fee structure.
Prosper Reviews: Prosper holds a lower rating of approximately 7.3 out of 10, with some borrowers expressing concerns about the funding timeline and customer service experiences. Overall, while both lenders have their strengths, Upstart’s consistently positive feedback and strong reputation in the industry make it a more trustworthy choice for many borrowers seeking personal loans.
| Feature | Upstart | Prosper |
|---|---|---|
| APR Range | 7.40% to 29.99% | 8.99% to 35.99% |
| Factors Influencing Rates | Credit score, income, education, job history | Credit score and debt-to-income ratio |
| Lowest Possible Rate | 7.40% | 8.99% |
| Trustpilot Rating | 9.2/10 | 7.3/10 |
| Common Feedback | Fast processing, transparent fees | Concerns about funding speed and customer service |
This summary gives you a glimpse into what customers think about Upstart and Prosper, helping you decide which lender is more trustworthy and reliable.
What Types of Loans Does Upstart and Prosper Provide?
Both Upstart and Prosper provide a range of loan types to meet diverse financial needs. Here’s a breakdown of the different loan offerings available through each platform:
Upstart Loans:
- Personal Loans: For various purposes, including debt consolidation and home improvement.
- Debt Consolidation Loans: Specifically designed to combine multiple debts into a single payment.
- Car Loan Refinance: To reduce monthly payments on existing car loans.
- Short-term Relief Loans: For unexpected expenses or emergencies.
Prosper Loans:
- Personal Loans: Flexible loans for personal use, such as home improvements or medical expenses.
- Debt Consolidation Loans: Aimed at helping borrowers manage existing debt more effectively.
- Home Improvement Loans: Specifically for renovations and upgrades to residential properties.
- Medical Expense Loans: Designed to cover unexpected medical bills or procedures.
This variety allows borrowers to choose loans customized to their specific situations, whether they need funds for emergencies, consolidating debt, or making significant purchases.
| Feature | Upstart | Prosper |
|---|---|---|
| APR Range | 7.40% to 29.99% | 8.99% to 35.99% |
| Factors Influencing Rates | Credit score, income, education, job history | Credit score and debt-to-income ratio |
| Lowest Possible Rate | 7.40% | 8.99% |
| Trustpilot Rating | 9.2/10 | 7.3/10 |
| Common Feedback | Fast processing, transparent fees | Concerns about funding speed, customer service |
| Personal Loans | Yes | Yes |
| Debt Consolidation Loans | Yes | Yes |
| Car Loan Refinance | Yes | No |
| Short-term Relief Loans | Yes | No |
| Home Improvement Loans | No | Yes |
| Medical Expense Loans | No | Yes |
This comparison highlights the different types of loans offered by Upstart and Prosper, helping potential borrowers identify which lender may best suit their financial needs.
Upstart vs Prosper: Pros and Cons
It’s important to consider the advantages and disadvantages of each lender based on factors like fees, flexibility, and customer service before choosing the right one for your personal loan needs.
Pros and Cons of Upstart Loans
| Pros | Cons |
|---|---|
| AI-driven qualification: Allows borrowers with limited credit history to qualify. Fast funding: Loans can be disbursed as quickly as the next business day. Transparent process: Clear details on fees, loan terms, and eligibility. Competitive rates: Offers personalized loan terms for good credit scores. | High origination fees: Can go up to 12%, increasing upfront costs. Limited repayment terms: Only offers 3 or 5-year options. Potential high APRs: Rates can reach up to 35.99%. No co-signer option: May limit flexibility for some borrowers. |
Pros and Cons of Prosper Loans
| Pros | Cons |
|---|---|
| Lower origination fees: Ranges from 1% to 5%, reducing upfront costs. Peer-to-peer model: Connects borrowers with individual investors for competitive rates. Joint loan option: Allows co-borrowers to apply together for better terms. No prepayment penalty: Borrowers can pay off loans early without extra fees. | Higher minimum loan amount: Requires at least $2,000, which may not suit smaller needs. Longer funding time: Approval and funding can take up to 14 days. Higher APRs for lower credit scores: Can be expensive for borrowers with weaker financial profiles. |
Comparison: Upstart vs Prosper Pros and Cons
| Feature | Upstart | Prosper |
|---|---|---|
| APR Range | 7.40% to 29.99% | 8.99% to 35.99% |
| Factors Influencing Rates | Credit score, income, education, job history | Credit score and debt-to-income ratio |
| Lowest Possible Rate | 7.40% | 8.99% |
| Trustpilot Rating | 9.2/10 | 7.3/10 |
| Common Feedback | Fast processing, transparent fees | Concerns about funding speed and customer service |
| Flexibility in Qualification | AI-driven model | Joint loan option |
| Funding Speed | Next business day | Up to 14 days |
| Origination Fees | Up to 12% | 1% to 5% |
| Repayment Terms | Limited (3 or 5 years) | Flexible (3 or 5 years) |
| Prepayment Penalty | None | None |
Which Are the Best Personal Loan Providers in the USA?
In the competitive scenario of personal loans, several lenders stand out besides Upstart and Prosper. Here’s a brief overview of some of the best personal loan providers in the loan market:
- LightStream Personal Loan
Offers loans from $5,000 to $100,000 with APRs starting at 6.94%. Known for no origination fees and flexible repayment terms up to 240 months. - SoFi Personal Loan
Provides loans of $5,000 to $100,000 with APRs ranging from 8.99% to 29.49%. Features include no fees, member benefits, and career coaching. - Discover Personal Loan
Specializes in loans from $2,500 to $40,000 with APRs starting at 7.99%. Ideal for debt consolidation with no origination fees. - Upgrade Personal Loan
Offers loans between $1,000 and $50,000 with APRs ranging from 7.99% to 35.99%. Best for emergency funding due to quick approval times. - Citibank Personal Loan
Provides loans from $2,000 to $50,000 with APRs starting at 11.49%. No origination fees but requires existing Citi customers for eligibility.
| Lender | Loan Amount | APR Range | Repayment Terms | Highlights |
|---|---|---|---|---|
| LightStream | $5,000 – $100,000 | 6.94% – 25.29% | Up to 240 months | No fees, flexible terms |
| SoFi | $5,000 – $100,000 | 8.99% – 29.49% | Up to 84 months | No fees, member benefits |
| Discover | $2,500 – $40,000 | 7.99% – 24.99% | Up to 84 months | Ideal for debt consolidation |
| Upgrade | $1,000 – $50,000 | 7.99% – 35.99% | Up to 84 months | Quick approval |
| Citibank | $2,000 – $50,000 | 11.49% – 20.49% | Up to 60 months | No fees for existing customers |
Which Lender Is Better for Different Types of Borrowers?
- Low Credit Score Borrowers: With a minimum credit score requirement of 620, Upstart is ideal for those with limited credit history or lower scores. Its AI-driven approach allows for more flexible qualification criteria.
- High Credit Score Borrowers: For borrowers with a credit score of 640 or higher, Prosper offers competitive rates and lower origination fees, making it a great choice for those seeking the best loan terms.
- Borrowers Needing Smaller Loans: Upstart allows loans starting at $1,000, which is beneficial for those who need smaller amounts for personal expenses or emergencies.
- Borrowers Seeking Debt Consolidation: With its focus on personal loans for debt consolidation and potentially lower APRs for qualified borrowers, Prosper is well-suited for individuals looking to consolidate existing debts.
- Borrowers Who Value Fast Funding: Upstart can provide funding as quickly as the next business day after approval, making it a better option for those who need immediate financial assistance.
Upstart vs Prosper: Comparison for Borrower Profiles
| Borrower Profile | Best Choice | Reason |
|---|---|---|
| Low Credit Score | Upstart | Minimum score of 620; flexible criteria |
| High Credit Score | Prosper | Competitive rates; lower origination fees |
| Needing Smaller Loans | Upstart | Loans start at $1,000 |
| Seeking Debt Consolidation | Prosper | Focus on consolidation; potentially lower APRs |
| Valuing Fast Funding | Upstart | Funds available as soon as next business day |
Upstart vs Prosper: Which Is the Best Choice for You?
Choosing between Prosper vs Upstart personal loans ultimately depends on your unique financial situation and goals. However, it’s essential to keep in mind that there are other lenders in the market like LightStream, SoFi, or Upgrade, which provide competitive rates and unique features that may also meet your needs. Take the time to assess your financial profile; whether it’s speed, flexibility, or cost and make an informed decision that aligns with your goals.
Take Control of Your Finances
Ready to explore your options? Compare Prosper vs Upstart personal loans and other personal loans providers today to find the option that empowers you to achieve your financial dreams. Start your application and pave the way to your financial success.
FAQs About Upstart vs Prosper Personal Loans
Q1. What are the eligibility requirements for Upstart and Prosper?
Ans – To qualify for a loan with Upstart, you must be at least 18 years old, a U.S. citizen or permanent resident, have a credit score of 620 or higher, and a steady source of income. Prosper requires similar criteria but has a slightly higher credit score requirement of at least 640.
Q2. Which lender offers lower interest rates?
Ans – Upstart offers personal loans with fixed APRs ranging from 7.40% to 29.99%, while Prosper’s rates range from 8.99% to 35.99%. Therefore, Upstart generally provides lower starting rates, making it more favorable for many borrowers.
Q3. How much can I borrow with Upstart vs Prosper?
Ans – Upstart allows borrowers to take out loans ranging from $1,000 to $50,000, whereas Prosper offers loans between $2,000 and $50,000. This makes Upstart more flexible for those needing smaller loan amounts.
Q4. Which lender has fewer fees?
Ans – Upstart charges origination fees between 1% and 8%, while Prosper’s fees range from 1% to 5%. Overall, Prosper tends to have lower fees associated with loan origination and payment processing.
Q5. How quickly can I get my funds after approval?
Ans – Upstart can disburse funds as quickly as the next business day after approval, while Prosper typically takes about a week for final approval and funding. This makes Upstart a better option for those needing fast access to cash.
Q6. Which lender has a better reputation among borrowers?
Ans – Upstart holds an impressive Trustpilot rating of 9.2 out of 10 based on user reviews, while Prosper has a lower rating of 7.3 out of 10. This indicates that borrowers generally have a more positive experience with Upstart.
Q7. Can I pay off my loan early without penalties?
Ans – Yes, both Upstart and Prosper do not charge prepayment penalties, allowing borrowers to pay off their loans early without incurring additional fees.
Q8. What types of loans are offered by Upstart vs Prosper?
Ans – Both Upstart and Prosper primarily offer personal loans, which can be used for various purposes, including debt consolidation, home improvements, and unexpected expenses. However, Upstart also provides options for car loan refinancing, while Prosper focuses more on personal loans tailored for debt consolidation.
Q9. Is there a minimum income requirement for Upstart vs Prosper?
Ans – Upstart does not specify a minimum income requirement, but it does consider your income as part of the application process. Prosper generally looks for borrowers with a stable income source, but it does not publicly disclose a specific minimum income threshold.
Q10. How does the application process differ between Prosper vs Upstart loan?
Ans – The application process for both lenders is straightforward and can be completed online. Upstart typically takes a few minutes for pre-approval and provides a decision within days, while Prosper may take about 15 minutes to apply but can take longer for final funding due to its peer-to-peer model.
Q11. What is better, Upstart or Prosper?
Ans – Both Upstart and Prosper offer personal loans, but they cater to different borrowers. Upstart uses AI-driven underwriting, making it ideal for those with limited credit history but strong education and employment backgrounds. Prosper, a peer-to-peer lender, is better for those with good credit seeking competitive rates. Upstart may approve applicants with lower credit scores, while Prosper typically requires a minimum 640 credit score. If you have a strong credit profile, Prosper might offer better rates; otherwise, Upstart is more flexible.
Q12. What is the downside to Upstart loans?
Ans – Upstart loans come with drawbacks that borrowers should consider before applying. While Upstart offers quick approvals and flexible credit requirements, it also has high APRs, origination fees up to 12%, and limited availability in some states. Its AI-driven approval process can lead to unpredictable loan terms, making it less ideal for those seeking stability. Borrowers with excellent credit may find lower interest rates with other lenders. Always compare options to ensure you get the best loan for your needs.
Q13. What are the downsides of Prosper loans?
Ans – Prosper loans come with a few drawbacks that borrowers should consider. A minimum credit score of 640 is required, making it harder for those with lower scores to qualify. The origination fee ranges from 1% to 5%, adding to borrowing costs. Since Prosper is a peer-to-peer lending platform, loan funding can take longer. Borrowers with lower credit scores may face higher interest rates, and the loan amount is capped at $50,000, which may not be enough for larger expenses.
Q14. What credit score is needed for a Prosper loan?
Ans – To qualify for a Prosper loan, you need a minimum credit score of 640. As a peer-to-peer lender, Prosper focuses on borrowers with good to excellent credit. While a 640 score is the baseline, a higher score improves approval chances and secures lower interest rates. Other factors, like income, debt-to-income ratio, and credit history, also influence eligibility. If your credit score is below 640, you may need to improve your credit or explore lenders with more flexible requirements.
