SoFi and Prosper are two companies with personal loan products that have been getting a lot of attention. The question, however, is which one comes out on top? Because there are similar features between the two products, it can be difficult to determine which loan product is the best one for any given situation.
The following is a SoFi vs. Prosper comparison of the two loan products so you can decide which one would work best for your needs and your wallet.
SoFi vs. Prosper: Comparison
|Rates (APR)||5.74% – 16.99%||6.95% – 35.99%|
|Loan Terms||3 – 7 years||3 or 5 years|
|Loan Amounts||$5,000 – $100,000||$2,000 – $35,000|
|Fees||No origination or prepayment fees||Origination fee: 2.41% – 5.00%|
SoFi Personal Loans
SoFi’s personal loans are fairly versatile, and the company even provides ideas on how the money from the loan can be used. You could pay off a credit cardor use the money to make a large purchase. One of the benefits boasted by the loan is the low interest rate. If a person is paying high interest on other loans or credit cards, it could pay to get a SoFi loan to pay off those debts and pay less in the long-term because of reduced interest.
Some of the features of SoFi include:
- Quick application process
- Low interest rate
- A fixed monthly payment
- Financial advising is included
- Career and salary guidance
- A 0.125 percent interest rate discount on additional loans
- Access to more than 400 exclusive SoFi community events
To apply for a SoFi personal loan, you first find the interest rate you’ll be charged through the pre-approval process. There is no obligation to take the loan if the rate is unsatisfactory or you have a change of heart. Once your rate is found a loan can be selected.
The next step is providing identifying information in an online application. In addition to name, address, and telephone number, SoFi needs income information, your Social Security number, and employment information. Once it’s complete and the application gets approved, an electronic signature is required to have the funds wired to a bank account.
Prosper Personal Loans
Just like SoFi, Prosper boasts a low interest rate, no hidden fees, and a fixed term. The loans can be used for the same reasons as a SoFi loan. Funds can be acquired to buy a car, consolidate debt, improve your home, pay for a special occasion, support your small business, or even pay adoption fees to expand the family. What the money is used for is entirely up to you.
Some of the features of a Prosper market place loan include:
- Low interest rate
- Short loan term
- Fixed monthly payment
- Easy pre-approval and application process
The application process starts with checking your rate and stating the purpose of the loan. Checking the rate is how the pre-approval process begins. If the rate is acceptable, then the borrower can proceed to the application process. If it isn’t acceptable, there is no obligation to continue to the application. Once on the application page, it simply verifies the personal information entered but also asks for employment and income information.
Roles in the Personal Loan Market
When comparing SoFi and Prosper, both are obviously decent loan products. Side-by-side, SoFi has the lowest possible interest rate, a higher loan limit, and a longer term to pay the money back. Although a longer term translates into more interest paid over the life of the loan. However, the term gives you more time to pay back higher loan limits. These are investor-created loans, which is why limits must be established.
Basically the loans operate in the same way with just a few differences between them. Their application processes and approval processes are practically identical. They also share many characteristics with traditional personal loans in the way of APR, terms, and how they are repaid.
This type of personal loan is revolutionizing the way a person can quickly obtain the cash needed to achieve certain goals. It’s fast, all done online, and the money is deposited into a bank account. This means there is no longer any need to have a face-to-face encounter with a financial institution when applying for a personal loan. People from practically anywhere can apply and have access to the funds quickly.
Author: Jeff Gitlen
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