Best peer-to-peer personal loan lenders to consider in 2024 (2024)

Most of the best personal loans come directly from a bank or credit union. However, some companies offer peer-to-peer loans, which means the funding for your loan comes from another individual, not an institution. Peer-to-peer (P2P) loans can sometimes be more accessible to borrowers thanks to easy application processes and sometimes higher loan amounts.

CNBC Selectrounded up the best peer-to-peer personal loan lenders. We looked at key factors likeinterest 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 methodologybelow.)

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Who's this for?Prosperallows co-borrowers to submit a joint application, which can be a huge draw if your credit needs work. Another appealing feature of Prosper loans is that you can get funded as early as the next business day. Of course, to get your money as quickly as possible, you'll want to make sure your application is complete and accurate and there are no errors.

Standout benefits: Prosper doesn't charge any prepayment penalties, which means you can pay the loan back early without being penalized.

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Who's this for?Upstartallows borrowers to apply for up to $50,000 and has a minimum credit score requirement of just 300. This makes it a bit more accessible to those who have alower credit scorebut still need to borrow money.

To make it even more accessible, Upstart also accepts applicants withno 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.

Standout benefits: Upstart allows you toapply with a co-applicant, so if you don't have sufficient credit or have a low credit score, you still have one more shot to receive a lower interest rate. It also considers factors such as your education and employment when assessing the interest rate you'll be charged.

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Who's this for? Kiva is a crowdfunding platform ideal for entrepreneurs. While personal loan funds often can't be used to cover business expenses, Kiva allows you to raise microloans from your peers and use the funds to grow your business. You can raise up to $15,000 through the platform.

Standout benefits: Kiva's loans are offered at 0% interest since the company is a non-profit.

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Prosper was the first peer-to-peer personal loan lending platform in the U.S. It offers loan amounts between $2,000 and $50,000 with the possibility of getting your funding within one business day after your loan acceptance. You can choose term lengths from two to five years. On top of that, borrowers can change the due date on their payments, which provides them with increased flexibility. Origination fees are between 1% and 7.99% and get deducted from the loan proceeds.

Loan amount

$2,000 to $50,000

Terms

2 to 5 years

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Upstart is a marketplace that connects borrowers with lenders using artificial intelligence. You can borrow between $1,000 to $50,000 with either three or five-year terms. There are no penalties for paying off your balance early, but Upstart charges an origination fee (up to 12% of the amount you borrow) and late fees ($15 or 5% of the past due balance, whichever is greater).

To avoid impacting your credit score, you can estimate your interest rate on Upstart's website before applying.

Loan amount

$1,000 to $50,000

Terms

3 or 5 years

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Kivais a non-profit peer-based lending platform that allows start-ups and small businesses to crowdfund interest-free loans of up to $15,000. After you apply for a loan, you'll be asked to invite friends and family. to lend money to your campaign to prove your "creditworthiness." After approximately two weeks, your campaign will be made public to Kiva's network of 1.6 million lenders. You'll then have up to 36 months to repay your loan.

Loan amount

Up to $15,000

Terms

Up to 36 months

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Pros of peer-to-peer 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.
• Peer-to-peer loans must usually be paid off within one, three, or five years. These shorter repayment terms mean you can get rid of your debt quicker 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 may be quicker than other types of loans.
• Peer-to-peer loans can be easier to qualify with poor or limited credit history.

Cons of peer-to-peer loans

• While limited repayment terms can help you pay off your debt faster, it can be unappealing to borrowers who would prefer more time to pay off their debt, which in turn gives them smaller monthly payments to budget for.
• 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 to receive your funding, depending on the institution you apply through.

LendingClub stopped offering peer-to-peer loans at the end of 2020 and now funds loans directly. However, it's still worth considering, particularly if you want to consolidate multiple debts, since it 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 LendingClub loans, which start at $1,000 and can be as high as $40,000. Loan term lengths range from 24 to 60 months and there are no prepayment penalties, which means you can pay off your loan early without being charged a fee.

You 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. Just note that LendingClub charges origination fees, ranging from 3.00% to 8.00%of the loan amount.

Other peer-to-peer loan alternatives include borrowing directly from family or friends.Your friends and loved ones may be able to help you when a financial emergency strikes.

If you don't want to commit to a long-term loan, you may also want to consider credit cards, especially those with low or 0% intro APR offers. For example, with the Wells Fargo Reflect® Card, you can get a 0% intro APR for 21 months from account opening on purchases and qualifying balance transfers (18.24%, 24.74% or 29.99% variable APR afterward with a balance transfer fee of 5%, min: $5).

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To determine which personal loansare the best,CNBC Selectanalyzed 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 forpaying 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 disbursem*nt: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 debt consolidation, no or limited credit history, quick funding and small business.

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 ahard credit inquiryand request a full application, which could require proof of income, identity verification, proof of address and more.

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