LendingClub vs. Prosper: How They Compare for Personal Loans

by

At NerdWallet, we stick to strict standards of editorial integrity that will help you decide with full confidence. Many or all the products featured here are from your partners. Here’s how we make money.

Prosper and LendingClub are a couple of of the very most recognized and largest online lenders. They pioneered peer-to-peer funding and have issued billions in loans since their starts in 2006 and 2007, respectively. Both offer loans for debt consolidation reduction, home improvement and other purposes.

How are both of these lenders different? And which has the very best loan for you? Given their similarities, it?might get down to the eye rate you’re offered. Still, it’s worth comparing their fees, approval processes and special features. Here is a look at LendingClub and Prosper.

LendingClub

Prosper

Loan amounts
$1,000 to $40,000 $2,000 to $40,000
APR range
6.95% – 35.89% 6.95% – 35.99%
Origination fee
1% to 6% 2.4% to 5%
Loan durations
Three or 5 years Three or five years
Minimum qualifications

  • Credit score of 600
  • Credit good reputation for three years
  • Debt-to-income ratio of 40%

  • Credit score of 640
  • Debt-to-income ratio of 50%
Good option for:

  • Debt consolidation
  • Co-borrowers

  • Debt consolidation
  • Borrowers with high debt
Click “Check Rate” to pre-qualify on NerdWallet.

CHECK RATE

Consumers who be eligible for a unsecured loans from LendingClub and Prosper typically have strong credit. LendingClub’s average borrower has a score of 699; Prosper’s average borrower includes a?710. Consumers with lower credit ratings can still apply; both lenders consider additional circumstances when approving loans.

LendingClub accepts joint applications, which can boost approval odds, while Prosper accepts applicants with higher debt-to-income ratios.

As “peer-to-peer” lenders, both LendingClub and Prosper connect borrowers with folks who fund the loans and set interest rates.

LendingClub may well be a more sensible choice if you:

  • Have a co-borrower
  • Have a debt-to-income ratio of 40% or lower
  • Need a small-business loan

LendingClub was founded in 2007 and it has issued a lot more than $28.8 billion in loans, including unsecured loans. Most borrowers use their loans to refinance existing debt or repay charge cards.

How to qualify: And a?minimum credit rating of 600, LendingClub borrowers need a minimum of three years of credit rating. The typical customer has 16 years.

LendingClub doesn’t have minimum income requirement, but borrowers’ average earnings are $76,135. That’s lower than Prosper borrowers’ average of $86,400.

LendingClub accepts joint applications for those who can’t qualify on their own. One borrower’s credit rating should be at least 600, and also the other’s is often as low as 540. Their combined debt-to-income ratio ought to be below 35%.

Time to funding: The entire process, from trying to get financing to receiving funds inside your bank account, can take from seven to Ten days, similar to Prosper.

Costs: ?LendingClub’s APRs vary from 6.95% to 35.89%.

The APR includes an origination fee of 1% to 6% of the amount borrowed according to your credit profile. The total amount is deducted from the loan before you decide to receive it.

There’s no charge to?make extra payments or repay the loan early. In case your payment is more than 15 days late, you might be charged a charge of 5% of the amount due or $15, whichever is larger.

Business loans: In addition to personal loans, LendingClub has a separate lending platform for small-business loans as high as $300,000.

Prosper may well be a better option if you:

  • Carry substantial debt
  • Have a higher income and credit score

Prosper pioneered peer-to-peer lending in 2006 and has funded a lot more than $10 billion in loans.

How to qualify: Prosper caters mainly to borrowers with strong credit, huge salary along with a well-established credit rating. It accepts applicants with credit scores of 640 or above.

It’s also?open to borrowers who have significant existing debt. It accepts debt-to-income ratios up to 50%, while LendingClub’s maximum is 40%.

Time to funding: Much like LendingClub, Prosper’s approval process occupies to seven business days, with an additional one to three business days to receive your funds.

Costs: Prosper’s APRs vary from 6.95% to 35.99%, including an origination fee of two.4% to 5%. Just like LendingClub, the fee is deducted from your amount borrowed before you receive the money.

Prosper, like LendingClub, doesn’t charge almost anything to make extra payments or pay the loan off early. Her same late payment fee of 5% of the amount due or $15, whichever is greater, after a 15-day grace period.

Shop around to find the best personal loan

Your best bet might be to pre-qualify with both LendingClub and Prosper and compare rates on any provides you with get. Lenders offer a similar experience businesses but have unique grading systems, so one might offer you a better APR compared to other.

NerdWallet recommends comparing loans to get the best rate for you. Click on the button below to pre-qualify and receive a personalized rate from multiple lenders on NerdWallet.

CHECK RATE


NerdWallet’s ratings for personal loans award suggests lenders that provide consumer-friendly features, including: soft credit report checks, no fees, transparency of loan rates and terms, flexible payment options, accessible customer support, reporting of payments to credit bureaus, and financial education. We consider the quantity of complaints filed with agencies like the Consumer Financial Protection Bureau. This methodology applies simply to lenders that cap interest rates at 36%, the utmost rate financial experts and consumer advocates agree may be the acceptable limit for a loan to become affordable. NerdWallet does not receive compensation of any sort for our reviews. Read our editorial guidelines.

You may also like