Getting a Good Rate at Prosper.com

How much interest should you pay for your loan at Prosper.com? A fair rate allows you to do the things you need, while compensating your lender. This page discusses the factors that influence loan rates at Prosper.com. With this information, you can decide on a maximum interest rate that you're willing to pay.

General Interest Rates

Start by considering interest rates in general. Lenders can stick their money in a high-yielding online bank account or they can loan it to you. At the bank, their money earns a guaranteed rate of interest without risk - as long as the account is FDIC insured. You need to pay them at least what they can earn at the bank plus an additional premium.

Your Risk Grade

If you have a low risk grade, you'll have to pay a higher interest rate. Those with "AA" credit will get the lowest interest rates. As you move down the scale, lenders require an increasingly higher interest rate. They're taking a greater risk so they demand a better return.

The Going Rate

The best place to come up with some actual numbers is Prosper.com. Once you have a feel for the types of loans that are getting funded in the rates they fund at, you can make your decision.