My Prosper experience as an HR borrower

As always, you can see all of my Prosper coverage in one place.

I waited longer then I planned too when it came to writing this entry. Prosper has been on the war path. In just the last few weeks they have:

Back to my regularly scheduled post…

The short version…

Member since May 2006.

HR borrower the first time around, paid it off. ($1,000.00 @ 12.50%)
D borrower second time around, 25% paid off, never late. ($4,500.00 @ 13.50%)

Put $50 into my friends loan.

Emailed (in fairly accusatory tone) by Prosper because I talk about them on this blog. How nice of them to notice. It’s probably because I get a lot of traffic from the search engines on prosper keywords and/or because I am a member. Check my freshly minted stats for proof.

The long version…

I joined Prosper on May-16-2006 at 4:49 PM looking to consolidate some credit cards that were being a hassle. I joined a group right away, didn’t get many results, and started looking for other groups. I applied to several. Most I never heard back from, some sent me a nice denial letter, and finally one accepted me. I emailed back and forth with the group leader a few times, then setup a phone conversation for the weekend. We ended up being on the phone for about four or five hours as I recall. He walked me through what Prosper was and wasn’t and how he could help me fund my loan. We went through my five previous (unsuccessful) listings and discussed what about them wasn’t working. By the end of our conversation, my GL decided to fund my loan entirely on his own. This was not unheard of at the time, but rare nonetheless. We stayed in touch and have developed a good working relationship.

In February of 2007, having paid off my previous loan, I discussed another Prosper loan with my group leader. In the time since my first loan, by credit grade had improved from HR (high risk) to D (moderate risk). I asked for substantially more this time and my group leader agreed to fund part of it and leave the rest for the community for chip in on. The key here was going to be several fold to fund successfully:

  • Make sure that members of the community could find me and my listing.
  • Tout my improvement in credit grade and payment history.
  • Do NOT auto-fund the loan so that the rate can be bid down.
  • Explain work history, budget, and goals for the loan. Prove that previous goals were attained.

It all went very well. My rate went from 17% APR to 13.5% APR and had 135 bids over 7 days. The money was deposited in my bank account a couple days after close.

It is possible for a high risk borrower to get a loan on Prosper successfully. Don’t expect overnight money. This is a process that takes time, energy, patience, and the understanding that you are taking real money from real strangers. So many borrowers at Prosper default without ever making a payment that it is staggering. My Prosper payments have come first and carry more weight with me because they came from real people just like me and you that are looking to invest their money, get a return, and make a real difference in the lives of ordinary people.

4 thoughts on “My Prosper experience as an HR borrower

  1. Shaun,

    I just found your blog. Not sure why I didn’t know about it before. I enjoyed reading all your posts about Prosper.

    Why do you think you got a higher interest rate as a D borrower vs. a HR borrower? Was it just timing? The loan size is also larger but that shouldn’t make too big of a difference.

    Anyway, I enjoyed your Prosper posts. Perhaps you should write one for the next P2P lending blog carnival.


  2. Hi,
    I was reading your blog and I was wondering why my application was declined right away. I have a 1 year loan with Prosper and I have been paying properly, I have been doing all my other payments properly too. Not even one is delayed. The problem is that I have lived in the US since 2005 only, and most of my accounts seem to be maxed, due to the lender or credit card agency not properly displaying my credit limit or suddenly lowering it to the level of the balance. But I have been a good lender all through those 3,5 years. Now Prosper is telling me that my score is lower than 640 and has gone down more than 40 points since last year, but is unable to explain me how they got to that number. My Experian score is much higher than that and my score never went down more than 40 points anyway. Also, my loan was rated a C when I took it (July 2008) and this time it is rated an HR and Prosper cannot explain me the criteria used in this as well. Since last year, I closed a lease account and opened only one more account. What is the big deal if I am paying properly and do not have any collections or anything like that? Please explain if you know anything about it.
    Reply to this comment

  3. Since their re-opening, Prosper is only doing lender/borrower business in a few states. In addition to that, the credit scores that reflect their assigned grades have gone up. Under Prosper 1.0, what would have been a C, is probably now an HR, or worse, gets declined right away. You should get a written notice from Prosper as to why your listing was declined, but if not, you can always ask on the official Prosper forums, call them, orask the great people at

  4. I am floored by how the Prosper Score works. I have been approved for home loans and personal loans with a grade A, and under Prosper, they have roted me an HR, with a score of 3! Considering I have a credit score of over 720, and have never been late on a repayment, ever, I can’t imagine anyone who qualifies for a higher Prosper Rating needing to use this service. Anyone who can manage an A or B rating on Prosper surely can acquire the lowest interest loans by the biggest banks without a problem. This utterly amazes me.

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