Prosper isanonline lending marketplace operated byProsper Funding LLC («Prosper»). Prosper and its agents handle the registration ofborrower members and investors; the receipt, display and matching oflistings and investments onlistings; the issuance and sale ofBorrower Payment Dependent Notes («Notes») toinvestors; and the servicing and collection ofprincipal and interest and other charges payable onloans.
- Our borrower members can post listings onour marketplace torequest and obtain loans, which wecall «borrower loans.»
- Our investors can invest inlistings and purchase Notes from Prosper, the payments ofwhich are dependent onProsper’s receipt ofpayments onthe corresponding borrower loans described inthe listing.
All loans originated through the platform are made byWebBank, aUtah-chartered Industrial Bank. Our affiliate, Prosper Marketplace, Inc., provides services toWebBank inconnection with the origination ofsuch loans and services all loans made toProsper borrowers for the benefit ofour investors who purchase Notes dependent for payment onsuch loans.
All borrower loans are fixed rate, unsecured, fully amortizing loans with simple interest. All loans are obligations of individual borrowers and not of corporations or businesses. Borrowers who obtain a loan to be used for business purposes, are personally obligated to repay the loan, regardless of the success or failure of the business for which the loan may be used. The following limits and fees apply:
Borrower Limits and Fees
Loan amount:
$2,000 – $50,000
Maximum interest rate:
Origination fee:
Origination fees vary between 1% and 7.99%
Late fee:
At 15 days past due
The greater of5.00% ofthe unpaid installment amount, or$15
Failed payment fee:
$15
State of residence:
Prosper isavailable toBorrowers inallUS states except Iowa and West Virginia.
Investor Requirements
Asaninvestor onour marketplace, you are not actually lending your money directly toborrower members, but are, instead, purchasing Notes from Prosper, the payments ofwhich are dependent onProsper’s receipt ofpayments onthe corresponding borrower loans. Aninvestment inaloan listing isaninvestor’s commitment topurchase the Note issued byProsper, with the proceeds ofthe sale ofthe Note used byProsper topurchase the specific borrower loan described inthe listing onwhich the investment was made.
Your rights and obligations asaninvestor onour marketplace are set forth inthe Investor Registration Agreement.
For more information about Prosper, our Notes and Investor Requirement, please see our Prospectus. Tothe extent there isaconflict between the information contained inthis section and the Prospectus, you should rely onthe information inthe Prospectus.
Residence:
Prosper iscurrently available only toinvestors who reside inthe following states: Alaska, California, Colorado, Connecticut, Delaware, District ofColumbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Louisiana, Maine, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New York, Oregon, Rhode Island, South Carolina, South Dakota, Utah, Virginia, Washington, Wisconsin and Wyoming.
Individual investors may also berequired tomeet suitability requirements established bytheir state ofresidence.
Suitability:
Ifyou are aresident ofAlaska, Idaho, Missouri, Nevada, New Hampshire, Oregon, Virginia orWashington, you must have: (i) anAnnual Gross Income ofatleast $80,000; AND aNet Worth ofatleast $80,000; OR(ii) aNet Worth ofatleast $280,000. Inaddition, you may not purchase Notes and PMI Management Rights inanamount inexcess of10% ofyour Net Worth. For residents ofMaine and Oregon, the Maine Office ofSecurities recommends and the Oregon Division ofFinance and Corporate Securities further requires that your aggregate investment inNotes, PMI Management Rights and similar offerings by Prosper Marketplace, Inc., Prosper or their affiliates not exceed 10% of your liquid net worth. For this purpose, “liquid net worth” is defined as that portion of your Net Worth that consists of cash, cash equivalents and readily marketable securities.
Ifyou are aresident ofCalifornia, you must have: (i) had anAnnual Gross Income ofatleast $85,000 during the last tax year; AND agood faith belief that you will have anAnnual Gross Income ofatleast $85,000 for the current tax year; (ii) ORaNet Worth ofatleast $200,000 (or$300,000 together with your spouse); (iii) ORyour Net Investment must not exceed $2,500. Inaddition, you may not purchase Notes and PMI Management Rights inanamount inexcess of10% ofyour Net Worth.
For purposes ofthe suitability requirements described above, except asprovided otherwise, aninvestor and his orher spouse isconsidered tobeasingle person. Inaddition, the following definitions apply:
- «Annual gross income» means the total amount ofmoney you earn each year, before deducting any amounts for taxes, insurance, retirement contributions orany other payment orexpenses.
- «Net Worth» means the total value ofall assets, minus the total value ofall liabilities. The value ofanasset isequal tothe price atwhich aninvestor could reasonably expect tosell the asset. Incalculating net worth, aninvestor should only include assets that are liquid, meaning assets that consist ofcash orsomething that could bequickly and easily converted into cash, such aspublicly-traded stock. Aninvestor should not include illiquid assets inthe calculation ofnet worth, such ashomes, home furnishings orcars.
- «Net Investment» means the principal amount ofNotes and PMI Management Rights purchased, minus principal payments received onthe Notes and PMI Management Rights.
Minimum investment:
$25
Maximum investment (per listing):
The requested loan amount
Loan servicing fee:
Anannual rate of1.0% ofthe outstanding principal balance ofthe borrower loan
Collection agency fee rate:
Upto40% ofthe amount recovered onpre and post charged-off loans, plus any legal fees and transaction fees associated with payment processing and litigation costs
Notes and returns onNotes are not FDIC-insured and have noProsper orbank guarantee. Notes may lose value.
Notes purchased byinvestors are not transferable and must beheld until maturity.
THE COMMISSIONER OFCORPORATIONS OFTHE STATE OFCALIFORNIA DOES NOT RECOMMEND ORENDORSE THE PURCHASE OFTHESE SECURITIES
IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING ANEW ACCOUNT— Tohelp the government fight the funding ofterrorism and money laundering activities, federal law requires all financial institutions toobtain, verify, and record information that identifies each person who opens anaccount. What this means for you: When you open anaccount, wewill ask for your name, address, date ofbirth, social security number, and other information that will allowus toidentify you. Wemay also ask tosee your driver’s license orother identifying documents.
Prosper Funding LLCor Prosper Marketplace, Inc. holds the State consumer lending licenses and registrations shown below.
Notes offered by Prospectus. Notes investors receive are dependent for payment on unsecured loans made to individual borrowers. Not FDIC-insured; investments may lose value; no Prosper or bank guarantee. Prosper does not verify all information provided by borrowers in listings. Investors should review the prospectus before investing.
