Prosper vs Payoff 2022 | Side By Side Comparison

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If you're searching for a personal loan, the internet delivers many choices. There are multiple online lenders who provide superior quality service.

In this review, we explore what Prosper and Payoff uniquely offer. During our research, we found that while Payoff's fees and interest rates are relevant, Prosper's eligibility and feedback is also worth noting.

What is Payoff?

Payoff personal loans are excellent for consolidating credit card debt; the company does not offer loans for any other purpose. Payoff, however, has some attractive terms for credit card debt consolidation. Their APRs start at 5.99%, and loan amounts up to $40,000.

Another point to remember is that, while Payoff processes loans, they fund them through different lenders. Although the financing comes from these lenders, the loan appears on your credit record under the Payoff name. Meanwhile, you render payments to and correspond with Payoff, Inc.

What is Prosper?

Prosper is a pioneer in the personal loan industry. When it debuted in 2005, it was the first company to enter the peer-to-peer lending market. Customers with a credit score of 640 or higher can apply for unsecured personal loans through Prosper.

Prosper has matched over 1,170,000 borrowers with potential investors, resulting in more than $20 billion in personal loans. Consumers who wish to consolidate high-interest debt should choose this lender.

If the interest rate on your existing debt is higher than the average, consolidating debt with a Prosper loan could help you save money on interest.

What do they both offer?

Individual borrowers can fund loans on Payoff and Prosper; both companies act as go-betweens, hooking you up with loan servicers. Prosper and Payoff feature a fixed monthly payment and no prepayment penalty. They're both known for providing credit card debt consolidation with a simple application process. Loans from $2000 to $40,000 are available through Prosper. Payoff, however, offers personal loans ranging from $5000 to $40,000. The maximum loan amount is the same for both companies.

What does Payoff uniquely offer?

  • Minimum APR is low: Payoff's lowest APR of 5.99% is one of the best rates available, though you'll need a high credit score to qualify.
  • Boosts Score: Payoff borrowers with at least $5,000 in credit card balances enjoy a 40-point rise in their FICO Score on an average.
  • FICO Score updates: Borrowers who have paid off their debts receive free monthly FICO Score updates..

What does Prosper uniquely offer?

  • Swift financing: Funds are put into your bank account as soon as the next business day after you qualify, accept a loan offer, and receive final approval.
  • Enables joint application: You can apply for a personal loan with a co-borrower on Prosper. If you join with a co-borrower who has good credit, you may be able to get a personal loan with a lesser interest rate.
  • Multiple Offers: Prosper offers loans to cover a wide range of needs, including debt consolidation, healthcare financing, and costly home improvements. They also provide credit card services.

What are the rates, terms, and fees comparison for Prosper and Payoff?

Prosper offers personal loans in amounts ranging from $2,000 to $40,000. Prosper charges a 5% late fee to borrowers who are past due on their payments. The annual percentage rate (APR) can range from 7.95 % to 35.99 %. Prosper allows borrowers to choose between three and five-year terms. The origination fee ranges from 2.4 % to 5% of the total loan amount.

Header

payoff

prosper

Minimum Credit Score

640

640

Loan Amount

$5,000-$40,000

$2,000-$40,000

Approval Time

3 to 6 days

1 to 5 days

APR

5.99% To 24.99%

7.95% To 35.99%

Origination Fees

0% To 5%

2.4% To 5%

Loan Terms

2 To 5 Years

3 To 5 Years

Late Fees

No

$15 or 5% of the payment amount (whichever is greater) 

Eligibility Criteria for Payoff and Prosper

Payoff

  • The applicant must be 18 years or above.
  • The applicant needs to be a US citizen or permanent resident.
  • The applicant must have a social security number, and a checking account is mandated.
  • Minimum FICO credit score of 640 is essential.
  • They must not have any current delinquencies.

Prosper

  • Individual must be a minimum of 18 years or more to apply.
  • They are required to be a US citizen or permanent resident of US.
  • They should have a fair credit score of at least 640.
  • Applicant needs to own a bank account in their name.
  • A consistent means of revenue or an annual wage is mandated.
  • More than 5 credit searches for the last 6 months is not acceptable.
  • Managing a debt-to-income ratio of less than 50%.

Which has a better reputation?

Payoff's reputation

Payoff has an unfavorable BBB rating. It has a 1.47-star rating based on customer feedback. Drawbacks cited were automatic payment mechanisms, excessive APRs, etc. Payoff's parent company, Happy Money, received a 4.5 out of 5-star rating from over 120 reviews on Trustpilot. Nevertheless, some borrowers pleased with the service stated it helped them pay off bills and improve their credit scores. Positive reviews also mentioned good customer service and quick turnaround. 

Prosper's reputation

Prosper happens to have an A+ rating from the Better Business Bureau and is BBB accredited. Based on over 8670 reviews on Trustpilot, the company has a 4.7-star rating out of 5-stars. However, in 2020, the Consumer Financial Protection Bureau received some personal loan complaints from Prosper.

Verdict: Which personal loan company is better?

Prosper is a good choice for those searching for a small loan, while Payoff is better for those who want to save money on costs. 

If you're drowning in credit card debt, a Payoff personal loan could help. You'll only have to pay one loan, and you might even save money on interest. Payoff had a mixed response from critics. Also, the Payoff wait period looked to be longer, ranging from 5 to 6 days or more. 

As a result, prosper may be the superior alternative for a quick turnaround and dependable service based on customer feedback.

FAQs

With a credit score of under 600, can I get a Prosper loan?

People with less-than-perfect credit can get loans through Prosper. A rate estimate tool on the website allows you to enter a credit score of 580,suggesting that you can acquire a loan with this score. With that said, you should be aware that you will not be able to get the best prices.

Is it possible to pay a Payoff debt off sooner than expected?

Yes, Payoff has no prepayment penalties. Correlating with this, you can make extra payments or pay off your loan debt in full before the end of your term without incurring any fines. If you're switching lenders, keep in mind that you may have already paid an origination fee, which can be taken into account.

Is it possible to use a payback loan for anything?

While many lenders provide personal loans that can be used for nearly anything, Payoff requires consumers to use the funds to pay off their credit cards. It provides loans in the range of $5,000 to $40,000.

According to Prosper, when can you expect to receive funds?

If you submit all of your application documents on schedule, you could get your loan cash as soon as one business day after your application is approved. For most consumers, however, money takes three days following approval. According to Prosper, the typical time between application and funding is three to five days.

For Whom Is Prosper Most Appropriate?

Prosper is suitable for borrowers who wish to borrow money and have an acceptable credit score. This is due to the fact that loans start at just $2,000, and consumers need only a credit score of 600 to qualify. Furthermore, though the company's maximum APR is nearly 36%, the average from January to May 2021 was only 16.37%.

What are the advantages of using Payoff?

Payoff helps you consolidate credit card debt into a single payment with a lower interest rate. Payoff aims to empower you, the borrower, by providing a variety of assessments to assist you better understand your financial condition and your relationship with money. Payoff isn't content to hand you a loan and walk away. It also wants to make sure you pay down your debt with them and improve your financial habits. Correlating with this, you don't get into more credit card debt. Payoff offers two programs to assist consumers in achieving these objectives.

Related: Best Egg vs Upstart

About the author 

Greg Lorenzo

Greg is a financial expert who has been advising his audience on loans for over 10 years. He has a wealth of knowledge and experience in the area, and he is passionate about helping people get the best possible deal on their loans. Greg is an expert in negotiating loans, and he has a proven track record of getting his clients the best possible terms. He is also a strong advocate for financial literacy, and he regularly gives workshops and seminars on the topic.

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