Detailed Comparison of Personal Loans Across 11 Criteria: Rocket Loans Personal Loans and Prosper Personal Loans
We’re going to compare personal loans from Prosper and Rocket Loans. We’ve spent years working in the lending industry and we track dozens of lenders. We want to break down these two lender so you can see which one might be better for your situation.
The first thing we are going to look at is the personal loan amounts that Rocket Loans and Prosper offer for personal loans.
Both Prosper and Rocket Loans have a minimum loan amount of $2,000. Their top amount is also similar, but Prosper offers as much as $50,000 while Rocket Loans’ top amount is $45,000.
They also both have terms that run from 2 to 5 years. So far, they look pretty similar.
Who can be approved can be a bit of a fluid category. My research suggests that Prosper lends to people with Fair-to-Good credit. I think they lend down to 620 on the credit spectrum, but that’s just a guideline, of course. Rocket Loans appears to focus more on people with Good credit. I believe the minimum credit score for people to are approved is 640. So, just slightly above Prosper. But pretty similar.
Now let’s look at the cost of personal loans from Rocket Loans and Prosper.
Prosper’s lowest APR is 8.99% and Rocket Loans’ is 9.12%. That difference is hardly meaningful, but better is better, so I am going to highlight Prosper. Prosper’s top APR is 35.99% while Rocket Loans tops out at 29.99%. So, Rocket Loans wins the top number.
Prosper charges an origination fee of between 1% and 8% while Rocket Loans says that their origination fees go “up to 9%.” Prosper gets highlighted. The origination fee is a percentage of the borrowed amount and comes out of the proceeds of the loan. So, if you borrow $10,000 and have a 5% origination fee, you will receive $9,500 but will still need to repay the $10,000. Remember that the origination fee is accounted for in the APR. The APR is the origination fee plus the interest rate. All things being equal, you want a lower origination fee if you plan on paying off your loan early. Paying off early will save you on the interest you would have paid, but you don’t get a reimbursement of the origination fee.
Prosper will accept cosigners on their loans, but Rocket Loans will not. A cosigner is someone who agrees to pay off your loan if you fail to repay it. If you can qualify for the loan that you need, there is little reason to entangle a loved one in the process. But, if you have a spouse or loved one that has a stronger credit profile than you do, add them as a cosigner might make all the difference in getting the loan you need. It’s good that Prosper offers this option.
If you’re late on a payment, Prosper will charge you $15 or 5% of the late amount, whichever is higher. Rocket Loans will charge you $15. Rocket Loans wins this category because they won’t charge you more than $15.
Both Prosper and Rocket Loans charge other fees as well. Prosper charges a fee if you want to make your payment by paper check instead of ACH withdrawal. They also charge you if they attempt an ACH draw, but the payment fails because there’s not enough money in the account. Rocket Loans has this same fee, but they call it a bounced check fee.
If you are using the loan to consolidate credit card balances of other debt, neither Prosper nor Rocket Loans will use the loan’s proceeds to pay off your other debt for you. I like it when companies will do that because they understand that the loan is meant to replace your other debts and not just stack on top of them. The fact that neither of these companies will do it probably means that it would be harder to get approved with them if you want a loan for the purpose of consolidating debt.
Let’s summarize what we’ve learned about personal loans offered by Prosper and Rocket Loans.
In many ways Prosper and Rocket Loans are pretty evenly matched. Prosper accepts cosigners and Rocket Loans has a lightly lower fees. Neither are probably ideal if you are looking to consolidate your credit card balances. Probably the most important issue is whether you can get the money you need at the lowest possible price. On these two issues, these companies are pretty close. Each lender will have different criteria for deciding whether to approve you, how much to offer, and at what rate. That’s why we always recommend that before you accept a loan, you should shop around. Find the best deal. At The Yukon Project, we’ve tried to make shopping around easy. If you visit our marketplace page, you can apply to any one of our other featured lenders. Behind the scenes, we will check your rate with up to 40 other lenders. Our partners use a soft credit check, so applying won’t hurt your credit score. We will show you all of the approved offers so you can pick the loan that’s best for you.
If you have any questions about either of these lenders that we didn’t cover, leave a comment below. If you found this video useful, please like it and subscribe to our channel. Thanks for watching.
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