Prosper.com announced today that they have lowered interest rates across the board for all new loans. You can read the official press release here. I received an email from Prosper this morning with the news – here is an excerpt from that email:
In order to keep up the momentum and ensure our rates remain competitive, we are lowering our borrower rates – particularly for the highest quality borrowers where rate competition is most fierce. Attracting great quality borrowers is critical to delivering strong lender returns over time, and these changes will ensure we can do that while continuing to deliver fantastic risk adjusted lender returns.
The higher grade borrowers will get the most benefit but every new borrower will now be paying less for a Prosper loan. The new rates are very low, starting at just 4.99% for a AA rated loan, an amazingly low figure for an unsecured loan. For comparison here are Lending Club’s interest rates; they use a different rating system so we can’t really compare apples to apples but we can say that Lending Club’s interest rates range from 5.42% to 21.59%, a much tighter range than Prosper’s 4.99% to 31.99%. Here is the link to the page with Prosper’s new rates and below is a table that shows the differences between the old and new rates. [Read more…]