I've been a investor with this peer-to-peer website for a couple years now. The site is okay if you like "donating" money to people with no guarantee of return. It's more of a website about helping people rather than making money. After a couple of years, I'm just starting to break even.
Unfortunately, Prosper makes it too easy for individuals to get loans and they don't work hard to protect investors. You're dealing with all sorts of characters from honest to crooked. When things go bad Prosper hardly collects from those bad people that default on their loans and they leave the investors out to dry. Even if you try hard to analyze every borrower carefully, it's really hard to know their true living situation. The funny thing is that those with an "A" credit default too so nothing is guaranteed.
Prosper has had some issues with the SEC in the past and they are now restricted from operating in certain states. Some states now even require investors have high annual gross income and net worth in order to participate. As a Propser "Lender" you're really a purchaser of notes and not a true lender. If a borrower fails to pay their loan, you've basically lost out on your investment. It's like picking a bad stock or option. You have no recourse and you can't go after the borrower. The borrower may do bad and Prosper will shield and protect them. It's truly a risky investment and more about helping people than making money from them.
If you're interested in peer-to-peer investing, it would be safer to put your money in CDs, high yield savings accounts or bonds rather than Prosper. In Prosper, you're basically "donating" money to those in need of money hoping it will return. If Prosper wants to improve, it will have to be stricter on the borrower and more protective of the investor.
2.5 out of 5.0 stars
This review is the subjective opinion of an Investimonials member and not of Investimonials LLC
2 of 2 people have found this review helpful.
Was this review helpful?
Yes
No