A Short Guide to Borrowing from Peer to Peer Lenders

If you have paid back several payday loans on time and in full, your credit rating may have improved enough for you to borrow from a peer to peer lender. However, peer-to-peer lending works in a different way from payday loan lending. Here is an overview of the main differences.

How Peer-to-Peer Lenders Differ from Payday Loan Lenders

Peer-to-peer lending websites, such as Prosper and Lending Club, connect borrowers with lenders. Unsecured personal loans are offered, so no collateral is needed.

Peer-to-peer lenders usually offer very favorable interest rates. For example, Lending Club’s rates are currently between 6.03 percent and 26.06 percent, depending on your credit score and other factors.

You can borrow more money from  peer-to-peer lenders than a payday loan lender and pay it back over a longer period of time. For example, Prosper’s loans range from $2,000 to $35,000 and last for either three or five years.

Application Processes

Each peer-to-peer lending website has a different application process. Lending Club has a short, initial online application form that enables you to find out if you would qualify for a loan within a few minutes. If you qualify, the application process continues.

On Prosper, you write an online loan request, which includes the purpose of the loan and the reasons why you are a good candidate for a loan. Your loan request is then posted on the website and investors decide if they want to lend you all or part of the money.

Investors may be more inclined to lend you money if they can see that you have submitted documentation proving your identity, employment and other information to the website promptly. If one or more investors are willing to lend you money, you will need to complete the approval process before you receive the money in your bank account.

Ensuring Your Credit Information is Up-to-date

If your credit rating has improved in the past year or so, ask the major credit bureaus for copies of your credit reports before applying for a peer-to-peer loan. Read these reports carefully and, if any information is out-of-date or inaccurate, ensure that it is corrected before you apply for a loan.

This will maximize your chances of receiving a loan at a good interest rate because most peer-to-peer lending websites give you their own rating based on information from the credit bureaus and the documentation you provide.

If you need a fairly large loan, a peer-to-peer lender can provide you with the money at a very favorable interest rate, even if you do not yet have an excellent credit rating.



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  • Charles Hoffman says:

    I would like to borrow 2400 for 18 Mts. This would pay off 1600 in small loans and pay off my car. Thank You for your time.

  • Kathleen Livesey says:


    Looking for a loan for 24 months to payoff bills due to a bad divorce.

  • Wayne Walker says:

    I would Like to borrow 4000 This would help me pay some bills off. I am A hard worker I have been on my job for 40yrs and always had a pay check every week I am 59yrs old and been on the same job since I was 19. Peer to peer sounds like the kind of loan for me. Thanks for the info.

  • Carole Y Griffith says:

    I would like to get a loan to pay off some small debts and doctor bills.

  • Deborah Arango says:

    I would like a 1500 loan to
    Consolidate expenses occurred
    Due to deaths in the family.

  • vicky albin says:

    I’m desperate for a $2000 loan, after 29 years in construction bus we were forced to close the doors, since then 3 of us have been living off my small ss disability check. NEVER have i thought we would be in such survival mode. Good news is today my husband has got a job and starts monday but we need a vehicle for him he has to drive to were the new job is so gas, lodging, food, and a broken down truck. PLEASE I DON’T WANT HIM TO GET FIRED FROM A JOB BEFORE HE EVEN STARTS. He’s been trying to find employment in his field since December of 2012 and when we closed our doors but paid in massive amounts for unemployment but he don’t qualify for benifits. So I will be very honest we have been living on my social security disability check of $799.00 and thats supporting 3 of us. Would like it to be small monthly payments but hope to have it paid off in at least a year. Thank You

  • Nan Riley says:

    Hi. I’m seeking a loan to consolidate current bills and catch up on car payment. My credit is fair but I have stability in employment and excellent rental history.

  • Bennie Escobar says:

    I am looking for a 2000 to 4000 dollar loan to catch up on car payments,household bills,pay off some smaller bills and some medical bills.My wife is recently disabled so we are down 1 income.We are fighting with disability for her to get paid.Also my daughter has moved back in with our 3 yr. old granddaughter and is unemployed and currently going through a nasty divorce.I have been at my job for 35 yrs and rarely miss work but with my wife in and out of I’ve missed some days.Would like to pay it back over a few years.

  • Al Boggs says:

    Not much help at all for retired people. Really shows the greed. People work all their years and then are left out in the cold. good Americans???

  • Janet D Booher says:

    I’m reluctant to even ask. I am a start up (not in business yet) but I’ve taken all of my personal monies and have most everything ready. I have my website up and running but I did it myself and it needs some serious tweaking. I have my home based business ready but I need more inventory and advertising and working capital. My problem is I’m a Chronic Pain Patient and I can’t keep up with the balance of the bills. I would let something else go to catch up but it’s a vicious cycle. I had also started another business before and was scammed for thousands and couldn’t get help so I went out of business (BOOHER LIQUIDATIONS). Now I have a Christian Retail Store and the Holiday items are out everywhere!!! From now thru January I could bring in the cash. I have the right kind of store and it’s early but women love to shop! I’m asking for a $12,000.00 Line Of Credit. I really need twenty but I know with my credit the interest would be to high. But I can make 12,000.00 go a good ways. I hope you can help me. All day long I have had scammed emails trying to get me to give them money to (they say) give me money. I really hate to miss this opportunity. I would appreciate your help.

  • Jeffrey Fischer says:

    I would like to borrow $5000 for 36 months. I have several smaller short term loans which I would like to consolidate into one payment. The interest rate is a factor. I am employed full time as well as receive Social Security income.

  • EDNA BANKS says:

    I know my credit rating is the major reason for me not get the money I need. I need this for repairs to my car. I need it bec ause I have a daughter with multiples medical condition and I need that if something go wrong and I needed to get her to hospital through the night. My problems begin when I was caught in online romance scam last year and bills got behind. I am calling this as I see it because in this date age its just that way things are.

  • Jolene Cole says:

    I am in need of a loan so that I can get back on my feet. After going through a divorce in 2011 and having to file a bankruptcy I have found myself in a situation that I am unable to get out of. I have a total of less than 10000 debt.I am trying to start a business and also buy a car. I have moved to Florida and am finding that applying for the online loans the people who call me saying I am approved want the green dot card money upfront.I have been advised not to do this. I need help.I would like to combine everything into one payment and get my business going.i can do all of this with a loan for 15 to 20 thousand dollars.

  • Charles Ashley says:

    I am looking for a $4000-$8000 loan in order to consolidate my bills. We were a two income family but my wife has suffered through several debilitating illnesses and have had just my income for the last three years. Because of this my credit has been hit hard. Its been overwhelming but we’ve finally gotten a diagnosis. I have been truck driver for over 15yrs and make a good salary, and just need help to get back on my feet. I’m an honest, hardworking man praying for assistance.

  • Leroy McCoy says:

    Hello: I am in need of a bill consolidation loan. I looked into debt consolidation services and that was more expensive and i could not fit myself into the program without chances of dropping out. My only answer is a bill consolidation loan. My income is 2900 to 3300 dollars a month. I would appreciate any assistance offered.

  • Melissa Peck says:

    Hello, I am looking to payoff my 2 credit cards in the amount of 4,000. I work 2 jobs and this loan would enable me to start to save more money each month and close of one my cards. Thanks!

  • Dalton Jones says:

    Would like to borrow 5000 for 3 yr term to pay of furniture and credit card balances,my credit is bad,but that why I want loan to payoff accts.I am on disability have a steady income. I think a peer to peer loan would work best for me. Thanks for these articles, they are very helpful.