SoFi Vs. Prosper: Which Personal Loan Lender Is Right For You?

SoFi® and Prosper, two leading personal loan lenders, cater to different borrowers’ needs. SoFi, known for its low interest rates and membership perks, is excellent for high-income earners with good credit. On the other hand, Prosper, with its flexible loan options, serves borrowers looking for smaller loans or those with fair credit.

Either can be a good option depending on your financial needs.

SoFi vs. Prosper: A Brief Comparison

	SoFi	Prosper
Best for	Large loans	Small loans
Loan amounts	$5,000 to $100,000	$2,000 to $50,000
APRs	8.99% to 29.99%	8.99% to 35.99%
Loan terms	24 to 84 months	24 to 60 months
Fees	0% to 6% origination fee	1% to 7.99% origination fee
Minimum credit score	650	560
Time to funding	Same-day funding available	As soon as one business day
Cosigners?	Co-applicants but not cosigners	Co-applicants but not cosigners

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SoFi Personal Loans

Known for its competitive interest rates and large loan amounts, SoFi’s personal loans stand out as a top choice for borrowers with high incomes and strong credit. These are the pros and cons of SoFi personal loans.

Pros

• Low maximum interest rate. SoFi offers APRs ranging from 8.99% to 29.99%. Lower interest rates translate into lower total repayment costs, which can make SoFi an affordable option for borrowers with a good credit history.
• Large loan amounts. With a borrowing range of $5,000 to $100,000, SoFi makes large personal loan amounts available to borrowers. This can be particularly beneficial for borrowers needing large sums of money for big-ticket items such as home renovations, debt consolidation or high-cost medical procedures.
• Long loan terms. SoFi offers flexible loan terms ranging from 24 to 84 months, allowing borrowers to spread their payments over a long period. This flexibility can result in lower, more manageable monthly payments.
• No origination fees. SoFi doesn’t charge origination fees on personal loans, but the lender may offer you the option of paying an origination fee up to 6% to lower your interest rate.
• Short funding time. SoFi reports that 82% of eligible borrowers between January 1, 2022, and January 1, 2023, received their loan funds the same day.
• Ability to apply with a co-borrower. Both SoFi allows consumers to apply for personal loans with co-borrowers, also known as co-applicants. Given SoFi’s low rates and large loan amounts, having a co-applicant can make it easier for borrowers to access larger sums of money at more affordable rates.

Cons

• High credit score requirement. SoFi imposes a minimum credit score requirement of 650, making the lender slightly less accessible to borrowers with lower credit scores.
• Few options for smaller loans. SoF’s minimum loan amount might not be suitable for borrowers looking for smaller, more manageable loans.
• High minimum interest rates. While SoFi offers lower maximum interest rates, its minimum APR is 8.99%. This could make the loan expensive for borrowers with excellent credit.

Prosper Personal Loans

In contrast to SoFi, Prosper’s personal loans cater to a broader spectrum of borrowers with its more flexible loan options and lower credit score requirements. The following explores the advantages and the potential drawbacks of opting for a personal loan with Prosper.

Pros

• Low minimum interest rate. Prosper’s interest rates range from 6.99% to 35.99%, which makes Prosper an affordable option for the most creditworthy borrowers.
• Low credit score requirement. Prosper works with borrowers with credit scores as low as 640. This threshold makes Prosper more accessible to a broader range of borrowers, including those who may not have an excellent credit history but are still creditworthy and capable of repaying their loans on time.
• Availability of smaller loans. Prosper offers loans between $2,000 to $50,000, making Prosper suitable for borrowers who need access to smaller loans for minor projects, emergencies or financial gaps.

Cons

• Lower loan amounts. Prosper’s maximum loan amount may be insufficient for borrowers seeking substantial amounts for large-scale projects or extensive debt consolidation.
• Shorter loan terms. Prosper limits loan terms to 60 months, which can lead to higher monthly payments, potentially making the loan less manageable for some borrowers.
• Origination fee. Prosper charges an origination fee between 1% to 7.99% of the loan amount. The origination fee effectively reduces the loan amount available to the borrower.

Choosing Between SoFi and Prosper

Choosing between SoFi and Prosper ultimately depends on your financial situation, needs and credit profile. If you have a strong credit history and are looking for larger loans with low interest rates, SoFi could be a more suitable option.

SoFi targets consumers with good credit, offering loan amounts up to $100,000 at competitive rates. It also provides longer loan terms, which could result in lower monthly payments, making it more manageable for borrowers. Origination fees are also lower and funds are available as soon as the same day—a popular feature among the best personal loans.

On the other hand, Prosper could be a better choice for those with lower credit scores or those who need smaller loan amounts. Prosper extends its services to borrowers with credit scores as low as 640 and also offers loans starting from $2,000. That said, funding times may be slightly slower, and the lender’s maximum interest rates and origination fees are higher than SoFi’s.