Inflation is on the rise, and it seems like we all have an endless list of unexpected bills. Whether vehicle repairs, ER trips, debt consolidation, or broken appliances, the costs of everyday life keep mounting. It's no surprise that more people are turning to personal loans.
Upstart and Prosper are two popular online lenders that offer personal loans with simple applications. In this review, we'll help you weigh the important factors to pick which is best for you.
What is Upstart?
Started by former Google employees, Upstart uses artificial intelligence (AI) to match lenders with borrowers. It connects people in need of money to those with money who wish to invest it. Since it is more tolerant of low-credit customers, the AI approval process is a useful feature. It facilitates some borrowers who would not otherwise be authorized if a lender merely looked at their credit score and debt-to-income ratio. Upstart provides loans ranging from $1,000 to $50,000
What is Prosper?
Prosper is a lending platform that connects borrowers and investors through peer-to-peer lending. Individual investors fund your loan rather than a bank lending you money. You could have a higher chance of obtaining funds, and buyers profit from your loan's interest. Personal loans and home equity lines of credit are available through Prosper. They offer loans ranging from $2,000 to $40,000 with terms of three or five years. You also don't have to worry about paying a prepayment penalty if you pay off the loan early.
What do they both offer?
Both Upstart and Prosper are platforms that help borrowers meet lenders, outside of the traditional bank model. In the case of Prosper, they are peer-to-peer loans, allowing individual investors to fund loans. Former Google employees established Upstart in 2012, whereas Prosper has been around since 2005 when it first entered the lending market. Personal loans are the only products offered by both lenders. Prosper and Upstart provide loans that cover debt consolidation, healthcare financing/medical financing, home improvement, and so on.
Upstart and Prosper have the following features in common:
What does Upstart uniquely offer?
What does Prosper uniquely offer?
Rates, terms, and fees comparison
Personal loans from Prosper are offered in values ranging from $2,000 to $40,000. Borrowers who are past due on their payments are charged a 5% late fee by Prosper. The APR can range from 7.95% to 35.99%. Borrowers on Prosper can pick between three and five-year loan terms. The origination charge is 2.4% to 5% of the loan amount.
Upstart charges origination costs ranging from 0% to 8% on average, with a late payment fee of 5% of the past-due amount. The APR ranges from 3.09% to 35.99%, with a loan duration of 3 to 5 years. Upstart offers personal loans with fixed rates ranging from $1,000 to $50,000. However, in certain states like Massachusetts ($7,000), Ohio ($6,000), New Mexico ($5,100), and Georgia ($3,100) have state-specific minimums.
Header | UPSTART | prosper |
|---|---|---|
Minimum Credit Score | 600 | 640 |
Loan Amount | $1,000-$50,000 | $2,000-$40,000 |
Approval Time | 1 to 3 days | 1 to 5 days |
APR | 3.09% To 35.99% | 7.95% To 35.99% |
Origination Fees | 0% - 8% | 2.4% To 5% |
Loan Terms | 3 To 5 Years | 3 To 5 Years |
Eligibility Criteria for Upstart and Prosper
Upstart
Prosper
Which has a better reputation?
The Better Business Bureau has given Prosper an A+ rating and it is BBB recognized. On Trustpilot, the company has a 4.7-star rating out of 5-stars rating based on over 8640 reviews. Prosper was the subject of 31 personal loan complaints to the Consumer Financial Protection Bureau in 2020.
Upstart, an accredited company, has a B+ rating from the Better Business Bureau. Whereas, based on over 31,900 reviews, Upstart has received an excellent rating of 4.9-star out of 5 stars on Trustpilot. Positive feedback emphasizes how simple the application procedure is and how convenient Upstart's credit card consolidation loans are.
Final thoughts
If you're not in a rush and want to save money, Prosper might be the right option for you. However, Upstart is a good place to go if you need a loan under $2,000 or up to $50,000. Upstart also outperforms the competition in terms of customer satisfaction. In addition, Upstart's online application takes just a few minutes to complete.
You may receive financing as soon as the next business day after accepting the loan contract, although Prosper may take longer. If you qualify, you'll have your completed loan contract in seven days while your approved money gets disbursed after you agree. Finally, you should examine your loan alternatives before signing to ensure that you get the best offer possible.
FAQs
Upstart is a viable alternative for debt consolidation for borrowers with fair to good credit. You should be able to acquire a lower APR if you have good credit. Correlating with this, when you have a lower credit score, you could still meet the criteria for a loan if they believe you have decent earning capacity. In addition to your credit, Upstart considers your education and job experience. Upstart could be a good option if you need money quickly and don't mind paying an origination fee.
Upstart and Prosper allow you to repay your loan online via automatic payments or paper checks.
Personal loans from Upstart and Prosper offer three to five-year repayment durations.
While Prosper is peer-to-peer, Upstart is very similar in that both services pair you with a lender that fits your personal needs. Personal loans are the only products offered by both lenders.
It takes several criteria to determine a good rate, including your credit history and income. It is beneficial to browse around, just like you would when purchasing a home or other major investment. Consider using a service that allows you to apply for loans from numerous lenders with a single application. This will increase your chances of getting the best rate and terms on your loan.
Keep track of the details, just like any other loan. Don't borrow more money than you can safely return, make on-time payments every month, and speak with your lender if you require forbearance or other adjustments due to unanticipated events. It's also a good idea to look into the lender's reputation. Customer reviews and a Better Business Bureau rating can be quite helpful in deciding which supplier to select for your loan.
