Here are some of the best peer-to-peer personal loan lenders to consider applying for

Personal loans are a common way to pay for large expenses like weddings, funerals and home renovations. They can be especially handy when you need funding in a pinch since some lenders can deposit your funds as early as the next business day.

Most lenders are what’s known as direct lenders, meaning the lender (usually a bank) provides the funding for your loan. But some lenders are actually peer-to-peer lenders, which means the funding for your loan comes from another individual, not an institution. Peer-to-peer loans can sometimes be more accessible to borrowers thanks to easy application processes and sometimes higher loan amounts.

Select rounded up some peer-to-peer personal loan lenders. We looked at key factors like interest rates, fees, loan amounts and term lengths offered, plus other features including how your funds are distributed, autopay discounts, customer service and how fast you can get your funds. (Read more about our methodology below.)

Select’s picks for the best peer-to-peer personal loans

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Best for debt consolidation

LendingClub Personal Loans

  • Annual Percentage Rate (APR)

  • Loan purpose

    Debt consolidation, major expenses, emergency costs, moving, weddings

  • Loan amounts

  • Terms

  • Credit needed

  • Origination fee

     2% to 6% of the loan amount

  • Early payoff penalty

  • Late fee

    15-day grace period to make payments with no penalty

Pros

  • Co-borrowers are permitted
  • No prepayment penalty
  • Loan amounts as low as $1,000
  • Quick application you can submit in just a few minutes
  • Ability to check your rate without hurting your credit score

Cons

  • Doesn’t accept co-signers
  • Origination fee of 2% to 6% of the loan amount
  • Only two loan terms to choose from (3 or 5 years)

Who’s this for? LendingClub Personal Loans is an attractive option for those looking to consolidate multiple debts since this lender allows you to send the loan funds directly to your creditors. This takes much of the hassle out of debt consolidation since you won’t have to send the funds yourself.

Borrowers looking for smaller loan amounts can benefit from a LendingClub loan, which start at $1,000. The maximum loan amount you can take out is $40,000. Just keep in mind that LendingClub loans come with origination fees ranging from 2% to 6% of the loan amount. This can be a significant expense depending on how much you’re borrowing, and the fee will be deducted from loan proceeds. For example, if you take out a $10,000 loan and you’re charged a 5% origination fee, only $9,500 will be deposited into your bank account, while you’ll still need to pay back the full $10,000 plus interest.

This lender doesn’t have any prepayment penalties, which means you can pay off your loan early without being charged a fee. Borrowers may also apply for a LendingClub loan with a co-applicant. Joint applications allow two borrowers to apply for a loan together so both credit histories are evaluated to potentially get you a lower interest rate on the loan.

Best for quick funding

Prosper Personal Loans

  • Annual Percentage Rate (APR)

  • Loan purpose

    Debt consolidation/refinancing, home improvement, auto/motor, medical or dental, big purchase and more

  • Loan amounts

  • Terms

    24, 36, 48, and 60 months

  • Credit needed

  • Origination fee

     2.41% to 5%, deducted from loan proceeds

  • Early payoff penalty

  • Late fee

    5% of monthly payment amount or $15, whichever is greater (with 15-day grace period)

Pros

  • Co-borrowers are permitted
  • Repeat borrowers may qualify for APR discounts
  • Option to change your payment date according to when works best for you
  • Wide range of loan amounts
  • No prepayment penalty

Cons

  • High late fees
  • Origination fee of 2.41% to 5.99%, deducted from loan proceeds

Who’s this for? Prosper allows co-borrowers to submit a joint application, which can certainly be a huge draw for some potential borrowers when you consider the fact that this is not the case for all loans. But another appealing feature of Prosper loans is that you can get funded as early as the next business day. And if you’re a repeat borrower, you may qualify for APR discounts on your loan.

Prosper offers loan amounts between $2,000 and $50,000 with the possibility of next-day funding. You can choose term lengths from two to five years and, the APR for Prosper personal loans ranges from 7.95% to 35.99%. Origination fees are between 2.41% to 5% and get deducted from the loan proceeds.

Best for people without credit history

Upstart Personal Loans

  • Annual Percentage Rate (APR)

  • Loan purpose

    Debt consolidation, credit card refinancing, home improvement, wedding, moving or medical

  • Loan amounts

  • Terms

  • Credit needed

    Credit score of 300 on at least one credit report (but will accept applicants whose credit history is so insufficient they don’t have a credit score)

  • Origination fee

    0% to 10% of the target amount

  • Early payoff penalty

  • Late fee

    The greater of 5% of last amount due or $15, whichever is greater

Pros

  • Open to borrowers with fair credit (minimum 300 score)
  • Will accept applicants who have insufficient credit history and don’t have a credit score
  • No early payoff fees
  • 99% of personal loan funds are sent the next business day after completing required paperwork before 5 p.m. Monday through Friday

Cons

  • High late fees
  • Origination fee of 0% to 10% of the target amount (automatically withheld from the loan before it’s delivered to you)
  • $10 fee to request paper copies of loan agreement (no fee for eSigned virtual copies)
  • Must have a Social Security number

Who’s this for? Upstart allows borrowers to apply for up to $50,000 and has a minimum credit score requirement of 600. This makes it a bit more accessible to those who have a lower credit score but still need to borrow money.

But to make it even more accessible, this lender also accepts applicants with no credit history, making it a good choice for someone who needs to borrow a larger amount of money but doesn’t have sufficient credit history. Just keep in mind that getting approved with a lower credit score or no credit score could mean that you receive a higher interest rate on your loan.

Upstart also allows you to apply with a co-applicant, so if you don’t have sufficient credit or you have a low credit score, you still have one more shot to receive a lower interest rate.

While there are no penalties for paying off your balance early, Upstart does charge an origination fee (up to 8% of the amount you borrow) and late fees ($15 or 5% of the past due balance, whichever is greater).

When it comes to repaying the balance, loan terms range from 36 to 60 months.

Peer-to-Peer loan FAQs

What is peer-to-peer lending?

Peer-to-peer lending is the process of getting a loan directly from another individual. Typically with a direct loan, you apply for funds through a financial institution and the institution funds you directly. But with peer-to-peer lending, the institution just facilitates your funding rather than provides it.

See if you’re pre-approved for a personal loan offer.

Are peer-to-peer loans safe?

Peer-to-peer loans should be as safe for borrowers as pretty much any other kind of loan. In fact, it’s the lenders who actually take on the real risk with peer-to-peer lending. Individuals (also known as investors) who deposit money meant to be loaned out to borrowers do not have their money FDIC-insured. Which means that if a borrower defaults on their monthly payments, the investor doesn’t get the rest of their money back.

What are the pros of peer-to-peer loans?

Similar to other personal loans, peer-to-peer loans carry lower interest rates compared to credit cards. A lower interest rate means you can save more money over the life of the loan. Additionally, peer-to-peer loans must usually be paid off within one, three, or five years. These shorter repayment terms means you can get rid of your debt a little quicker this way rather than if you were to take on a different kind of loan (personal loan terms can be as long as seven years).

The application and funding process also usually goes a bit quicker with peer-to-peer loans since there are so many lending options available (multiple peer investors rather than just one financial institution).

What are the cons of peer-to-peer loans?

While limited repayment terms can help you pay off your debt faster, it can also be unappealing to borrowers who would actually prefer more time to pay off their debt, which in turn gives them smaller monthly payments to budget for.

Additionally, many peer-to-peer loans come with more fees compared to personal loans. You may be charged a closing fee for a peer-to-peer loan in order to receive your funding, depending on the institution you apply through.

Our methodology

To determine which personal loans are the best, Select analyzed dozens of U.S. personal loans offered by both online and brick-and-mortar banks, including large credit unions, that come with fixed-rate APRs and flexible loan amounts and terms to suit an array of financing needs.

When narrowing down and ranking the best personal loans for fair or good credit, we focused on the following features:

  • Fixed-rate APR: Variable rates can go up and down over the lifetime of your loan. With a fixed rate APR, you lock in an interest rate for the duration of the loan’s term, which means your monthly payment won’t vary, making your budget easier to plan.
  • Flexible minimum and maximum loan amounts/terms: Each lender provides a variety of financing options that you can customize based on your monthly budget and how long you need to pay back your loan.
  • No early payoff penalties: The lenders on our list do not charge borrowers for paying off loans early.
  • Streamlined application process: We considered whether lenders offered same-day approval decisions and a fast online application process. 
  • Customer support: Every loan on our list provides customer service available via telephone, email or secure online messaging. We also opted for lenders with an online resource hub or advice center to help you educate yourself about the personal loan process and your finances.
  • Fund disbursement: The loans on our list deliver funds promptly through either electronic wire transfer to your checking account or in the form of a paper check. Some lenders offer the ability to pay your creditors directly.
  • Autopay discounts: We noted the lenders that reward you for enrolling in autopay by lowering your APR by 0.25% to 0.5%.
  • Creditor payment limits and loan sizes: The above lenders provide loans in an array of sizes, from $500 to $100,000. Each lender advertises its respective payment limits and loan sizes, and completing a preapproval process can give you an idea of what your interest rate and monthly payment would be for such an amount.

After reviewing the above features, we sorted our recommendations by best for having no credit history, borrowing smaller loan amounts, flexible terms, applying with a co-applicant and getting secured loan options.

Note that the rates and fee structures advertised for personal loans are subject to fluctuate in accordance with the Fed rate. However, once you accept your loan agreement, a fixed-rate APR will guarantee interest rate and monthly payment will remain consistent throughout the entire term of the loan. Your APR, monthly payment and loan amount depend on your credit history and creditworthiness. Before providing a loan, lenders will conduct a hard credit inquiry and request a full application, which could require proof of income, identity verification, proof of address and more. 

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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

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