What is Peer-to-Peer Lending and How Does it Work?

In recent years, lenders looking for small loans with competitive interest rates have turned to peer-to-peer lending (P2P) as a way to sidestep big financial institutions who have stopped lending money as freely as they used to, helping P2P investing become one of the fastest growing segments in the financial services industry. Born out of the 2008 financial crisis, the peer-to-peer lending model began when some companies started to developed online platforms where potential investors looking to earn returns on cash sitting in savings accounts could connect with borrowers looking for more options.

Sometimes called “social lending” or “crowd lending”, peer-to-peer lending companies act as the liaison between borrowers and investors through an internet platform – completely cutting banks out of the process. These lending platforms generate revenue by collecting a loan servicing fee to investors and by applying fees on funded loans from borrowers. After the loan has been funded, the money is released to the borrower by a partner bank and the loan company issues a note to the investor that acts as a form of security.

The lower operating costs and interest rates have made P2P lending a major competitor for the traditional banking system – and an appealing option for borrowers hunting for low-interest personal loan companies looking to diversify their investment portfolios. The streamline method also means that there is a fast turnaround for funding and fees are lower, with some peer-to-peer lenders not charging any penalties to borrowers for late or early payment.  

Borrowers tend to be people looking for unsecured loans of $1,000-$35,000 payable over 3-5 years, who don’t have access to home equity credit. These are often to help pay for small purchases - a used car, home repairs, and so on - or to consolidate their debt with a lower interest loan. Lenders tend to be individuals investing from $5,000 to $25,000, spread across a series of small, $25-$100 loans to minimize default risk. They are looking to sidestep banks and find investments that pay higher than traditional methods such as bank accounts and Certificates of Deposit (CDs).

Pros for Investors:

Lower risk 

If you’re a lender on a peer-to-peer site you have real freedom to pick and choose where to invest your money. If you’re worried about the borrowers you can keep your investment very low or just spread it across a portfolio with hundreds or even thousands of loans in order to offset the risk. 

Better yields

It’s not chiseled in stone, but peer-to-peer investors have the opportunity to get better returns on their money than they would with more traditional, conservative investments like stocks, bonds, mutual funds, and the like.  

Easy to get started 

Getting in the game is easy. You can open an investment account online easily and in no time. You can start off by investing small amounts - even as little as $25 - and then reinvest the earnings back into new loans. Managing your account is easy, you maintain total autonomy and getting up and running should be easier than you probably expected. 

Pros for Borrowers:

Better rates 

P2P sites connect the borrower and the lender directly, easily facilitating loans without you ever having to step foot inside a bank. What does this mean for your bottom line? Because P2P sites have less overhead and spread their risk over many lenders, you can often find a lower APR on a P2P site than at a traditional financial institution. This of course does depend to a large extent on your credit score, but the opportunity to save money on your loan is there with P2P lending. 

Easier application process 

When getting a P2P loan you can go online and get pre-approved within minutes. These sites have online applications that take very little time whatsoever, and you never have to go to your bank branch or even get out of bed if you don’t want to. You’ll still have to get your paperwork in order - including documents like bank statements, pay stubs, and the like, but the entire process should be much smoother. 

Fixed rates and no prepayment fee

With P2P loans you will most likely have a very clearly fixed repayment terms (typically of 24 or 36 months) which should help you manage and plan your monthly expenses. There won’t be any surprises and you’ll always know how much you own. Also, P2P lenders tend to not charge a fee for prepayment, if you come into some money and would like to pay your loan off early. 

Get money faster 

Typically the process is quicker with P2P lending and you should receive your funding within a week or two, and in some cases, within several days.

Cons for Investors:

Can lose money 

While it’s true that with peer-to-peer lending you get to diversify your portfolio to offset risk, this is by no means fool-proof. This is especially true if you go for more high risk portfolios. They do yield greater returns, but this comes with a higher degree of risk. Spread your loans out across a large portfolio and play it cautious at least at first. In addition, you are not allowed to cut your losses and sell the loan ahead of time – you are bound to the commitment made at the time of lending, which is typically for a matter of years. Also, your loans aren’t guaranteed by the federal government, so you could be left hung out to dry if the borrowers default. 

Harder to know your client

While offsetting the risk across a wide range of borrowers is a smart move, with P2P lending you’re also much less able to know your clients personally. This means you’ll have to trust the company’s determination of the risk involved with the borrower, instead of deciding on your own after performing due diligence. 

Cons for Borrowers:

Bad credit? It still won’t be easy 

You’ll probably find that with P2P lending you have an easier time getting a loan with poor credit than you would with a traditional bank. At the same time, you’ll probably pay for this by way of higher APRs, which could make it difficult to make your payments, potentially drawing you into further debt. Depending on the company, these APRs for people with bad credit can be very steep, even significantly higher than the interest on credit cards. 

Don’t forget the fees 

In addition to APR, with a P2P loan you’ll also have to pay origination fees, which can hover around 4% to 5% depending on the company and your credit score. These fees are typically deducted from the loan amount, which can offset the amount of money you’re actually getting. In addition, you’ll probably face additional fees for late or failed payments.

What Types of P2P Loans Are Available?

There are 4 main types of loans available with P2P lending, all of which are basically different forms of personal loans.

Unsecured personal loans

This is a very popular form of loan that borrowers often find to be less of a headache. An unsecured personal loan is one that doesn’t require you to put any collateral down to “secure” the loan. The good thing about this type of loan is that you don’t need to risk your house or car or some other form of valuable collateral, but this doesn’t come without a price. If you don’t secure the loan you stand to pay a higher APR, as you will be seen as a more risky borrower.

Secured personal loans 

If you do have collateral to put on your loan, then this may be your best option. With a secured personal loan you will have given the bank an insurance policy of sorts by way of your collateral. This will make you less of a risk for the bank, which should pay off for you by way of lower APR.

Debt consolidation loans

Done right, this can be one of the smarter, more financially-sound ways to use P2P lending to your advantage. If you have previous, high interest debts - such as credit cards or student loans - a P2P personal loan can be a great way to pay those loans off and consolidate your debt. It probably goes without saying though that this is only the case if the new loan has better terms. See what you can do to get the best terms possible, and a P2P loan to pay off those high-interest debts could really take the edge off.

Business loans

There are a number of options for entrepreneurs who are looking to get a business off the ground or just need some more cash flow to help their business soar. These can include Small Business Administration loans, microloans, and term loans, to name a few. With P2P lending you can also get a secured or unsecured personal loan which you can towards whatever it is your business needs.

Loans For Small Purchases, From Your Smartphone

One of the main draws for P2P lending is the customer experience, and the large number of lending companies consumers can choose from. Borrowers can shop interest rates without leaving the house and lenders can track their portfolio with a few clicks on their smart phone. Both lender and borrower can bid adieu to long lines at their local bank branch, where approval for a loan can take days rather than mere minutes on a P2P platform.

Lending companies make their money by charging fees to borrowers, taking a percentage of the loan repayments to investors, and collecting fees for defaulted loans, in addition to other service fees.

We recommend potential investors and borrowers read reviews of some of the industry’s top P2P platforms, including SoFi and LendingTree.

What to Consider:

Hidden Fees

Although P2P lending provides significant advantages to both investors and borrowers, you still need to do your homework. One thing to note is there are fees involved – including origination fees - that can range from 0.5% to more than 5% of the loan. Be sure to read the fine print and fully understand the total cost of the loan by the time it’s paid off.

Some lending companies charge contributions to “bad-debt provision funds” – which are set aside to help protect the lending company from losses. Because the loans are taken out with no collateral, P2P companies can sell the defaulted loans to a collection agency or take out a court order against the borrower.

Rise in Interest Rates

An average interest rate of a peer-to-peer loan is roughly 15% but if you have fantastic credit you can get rates as low as just over 5%. That said, those with poor credit can get stuck with much higher interest rates – as high as 30.99% for the riskiest borrowers at LendingClub – an industry leader.

Experts believe that if interest rates continue to increase, the industry could see higher costs for borrowers – and better returns for investors – perhaps leading to a bubble in the industry. Regardless, average interest rates on P2P loans are not likely to exceed those of credit cards, and as long as the economy is doing well and unemployment remains relatively low, the number of defaults shouldn’t raise any red flags.

Loan Term

Most peer-to-peer loans are only three to five year, fixed monthly payments, though many loans are stretched out over a longer period, with lower monthly payments and higher interest rates. This is yet another reason these loans are becoming favored - low interest with a fixed term for the repayment.

Bad Credit

Prior to 2008, lenders were focused on borrowers with credit scores over 640. Today, some P2P sites welcome borrowers with scores as low as 580, though they stand to pay higher interest rates than lower risk borrowers. In addition, some of the top peer-to-peer lenders look beyond just your credit score, factoring in considerations such as work history.

Regulations

In 2008 the Securities and Exchange Commission began to regulate the P2P industry and on the borrower side, agencies such as the Consumer Financial Protection Bureau and Federal Trade Commission now regulate the P2P industry. P2P platforms are subject to the same federal rules that govern all consumer credit company such as Equal Credit Opportunity Act and Fair Debt Collection Practices Act and borrowers are protected by state regulations against misleading advertising and discriminatory practices.

In 2016, growth for the P2P industry began to stumble under heightened regulation, leading many financial analysts to question predictions that the online lending platform poses a threat to traditional banking. Nonetheless, the industry is still on the rise and P2P loans remain an inexpensive way to consolidate a debt with a loan. We just want you to make sure that it is something you are prepared for and ready to face head-on.

So, What’s Next?

It’s up to you to determine if a peer-to-peer loan is the right way for you to get on the road to pay-off your debts or a ticket to higher returns on investment than your bank account or CD. If you compare peer-to-peer loans that are available and do some homework you can take part in an industry that is user friendly and has great potential for reward – all from the comfort of your home. For more information on P2P loan companies, read our reviews of top companies.

APR Rates

The  APR calculation on personal loans varies according to lender, but the rates on these loans are generally lower than what you would typically receive from a payday loan, starting at 10% and capping at 35.99%. 

APR rates mentioned include associated fees.

Full repayment for the loans displayed range between 61 days to 180 months.

Representative example: assuming a loan of $10,000 over 60 months at a fixed rate of 3.1% per annum and fees of $60.00. This would result in a representative rate of 3.3% APR, with monthly repayments of $180.80, for a total amount paid of $10,848.00.

† Credible Terms and Conditions:

Close with a better rate than you prequalify for on Credible and get a $200 gift card. Terms Apply.

Rates for personal loans provided by lenders on the Credible platform range between 6.94% - 35.99% APR with terms from 12 to 120 months. Credible also works with network Partners like MoneyLion and AmONE, who offer loan and other products with different rates and terms than described here. Rates presented include lender discounts for enrolling in autopay and loyalty programs, where applicable. Actual rates may be different from the rates advertised and/or shown and will be based on the lender’s eligibility criteria, which include factors such as credit score, loan amount, loan term, credit usage and history, and vary based on loan purpose. The lowest rates available typically require excellent credit, and for some lenders, may be reserved for specific loan purposes and/or shorter loan terms. The origination fee charged by the lenders on our platform ranges from 0% to 12%. Each lender has their own qualification criteria with respect to their autopay and loyalty discounts (e.g., some lenders require the borrower to elect autopay prior to loan funding in order to qualify for the autopay discount). All rates are determined by the lender and must be agreed upon between the borrower and the borrower’s chosen lender.

For a loan of $10,000 with a three year repayment period, an interest rate of 7.99%, a $350 origination fee and an APR of 10.43%, the borrower will receive $9,650 at the time of loan funding and will make 36 monthly payments of $313.32, assuming your lender deducts the origination fee from the offered loan amount. Assuming all on-time payments, and full performance of all terms and conditions of the loan contract and any discount programs enrolled in included in the APR/interest rate throughout the life of the loan, the borrower will pay a total of $11,279.43.

As of March 3, 2022, none of the lenders on our platform require a down payment nor do they charge any prepayment penalties.

* LightStream Terms and Conditions: 

*Your loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay may be higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice. Payment example: Monthly payments for a $10,000 loan at 4.99% APR with a term of 3 years would result in 36 monthly payments of $299.66. SunTrust now Truist is an Equal Housing Lender. © 2020 Truist Financial Corporation. SunTrust®, Truist, LightStream®, the LightStream logo, and the SunTrust logo are service marks of Trust Financial Corporation. All rights reserved. All other trademarks are the property of their respective owners. Lending services provided by SunTrust now Truist Bank. You can fund your loan today if today is a banking business day, your application is approved, and you complete the following steps by 2:30 p.m. Eastern time: (1) review and electronically sign your loan agreement; (2) provide us with your funding preferences and relevant banking information; and (3) complete the final verification process. After receiving your loan from us, if you are not completely satisfied with your experience, please contact us. We will email you a questionnaire so we can improve our services. When we receive your completed questionnaire, we will send you $100. Our guarantee expires 30 days after you receive your loan. We reserve the right to change or discontinue our guarantee at any time. Limited to one $100 payment per funded loan. Truist teammates do not qualify for the Loan Experience Guarantee.

‡ Upgrade Terms and Conditions:

Personal loans made through Upgrade feature Annual Percentage Rates (APRs) of 7.99%-35.99%. All personal loans have a 1.85% to 9.99% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. Loans feature repayment terms of 24 to 84 months. For example, if you receive a $10,000 loan with a 36-month term and a 17.59% APR (which includes a 13.94% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $341.48. Over the life of the loan, your payments would total $12,293.46. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early. Personal loans issued by Upgrade's bank partners. Information on Upgrade's bank partners can be found at https://www.upgrade.com/bank-partners/.

* Best Egg Terms and Conditions:  

*Trustpilot TrustScore as of December 2022. Best Egg loans are personal loans made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender or Blue Ridge Bank, N.A., Member FDIC, Equal Housing Lender. The Best Egg Credit Card is issued exclusively by First Bank & Trust, Member FDIC, Brookings SD pursuant to a license by Visa International. Visa is a registered trademark, and the Visa logo design is a trademark of Visa International Incorporated. “Best Egg” is a trademark of Best Egg Technologies, LLC. Offers may be sent pursuant to a joint marketing agreement between Cross River Bank, Blue Ridge Bank, N.A. and/or First Bank & Trust and Marlette Marketing, LLC, a subsidiary of Best Egg, Inc.

The term, amount, and APR of any loan we offer to you will depend on your credit score, income, debt payment obligations, loan amount, credit history and other factors. Your loan agreement will contain specific terms and conditions. About half of our customers get their money the next day. After successful verification, your money can be deposited in your bank account within 1-3 business days. The timing of available funds upon loan approval may vary depending upon your bank’s policies. Loan amounts range from $2,000– $50,000. Residents of Massachusetts have a minimum loan amount of $6,500 ; Ohio, $5,001; and Georgia, $3,001. For a second Best Egg loan, your total existing Best Egg loan balances cannot exceed $100,000. Annual Percentage Rates (APRs) range from 6.99%–35.99%. The APR is the cost of credit as a yearly rate and reflects both your interest rate and an origination fee of 0.99%– 9.99% of your loan amount, which will be deducted from any loan proceeds you receive. The origination fee on a loan term 4-years or longer will be at least 4.99%. Your loan term will impact your APR, which may be higher than our lowest advertised rate.

You need a minimum 700 FICO® score and a minimum individual annual income of $100,000 to qualify for our lowest APR. For example: a 5‐year $10,000 loan with 9.99% APR has 60 scheduled monthly payments of $201.81, and a 3‐year $5,000 loan with 7.99% APR has 36 scheduled monthly payments of $155.12. To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. What this means for you: When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents. Best Egg products are not available if you live in Iowa, Vermont, West Virginia, the District of Columbia, or U.S. Territories.

TO REPORT A PROBLEM OR COMPLAINT WITH THIS LENDER, YOU MAY WRITE OR CALL– Operations Manager, Email: crt-resolutions@bestegg.com, Address: P.O. Box 42912, Philadelphia, PA 19101, Phone: 1-855-282-6353. This lender is licensed and regulated by the New Mexico Regulation and Licensing Department, Financial Institutions Division, P.O. Box 25101, 2550 Cerrillos Road, Santa Fe, New Mexico 87504. To report any unresolved problems or complaints, contact the division by telephone at (505) 476-4885 or visit the website https://www.rld.nm.gov/financial-institutions/

* Achieve Terms and Conditions:  

1. Home Equity loans are available through Achieve Loans (NMLS ID #1810501), Equal Housing Lender. All loan requests are subject to eligibility requirements, application review, loan amount, loan term, and lender approval. Product terms are subject to change at any time. Home loans are a line of credit.

Loans are not available to residents of all states and available loan terms/fees may vary by state where offered. Line amounts are between $15,000 and $300,000 and are assigned based on debt-to-income ratio and loan-to-value ratio. Minimum 640 credit score applies for debt consolidation requests, minimum 670 applies for cash out requests.

Fixed rate APRs range from 9.75% - 15.00% and are assigned based on underwriting requirements and offer APRs include a .50% discount for automatic payment enrollment (autopay enrollment is not a condition of loan approval).

Example: average HELOC is $57,150 with an APR of 12.75% and estimated monthly payment of $951 for a 15-year loan. 10-year and 15-year terms available. Both terms have a 5-year draw period with the remaining term being a no draw period. Payments are fully amortized during each period and determined on the outstanding principal balance each month. Closing fees range from $750 to $6,685, depending on line amount and state law requirements and typically include origination (2.5% of line amount) and underwriting ($725) fees if allowed by law.

Property must be owner-occupied and combined loan-to-value ratio may not exceed 80%, including the new loan request. Property insurance is required and flood insurance may be required if the subject property is located in a flood zone. You must pledge your home as collateral.

Average funding time is between 15 to 18 days from submitted application and documentation and includes rescission. Contact Achieve Loans for further details.

* Reach Financial Terms and Conditions:  

All loans are subject to eligibility criteria and review of creditworthiness and history. Terms and conditions apply. All loans advertised are unsecured personal loans issued by either Metabank® National association, member FDIC, or FinWise Bank, a Utah chartered commercial bank, member FDIC, as creditor, on the Liberty Lending platform. If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, and the loan term you select. Fixed Annual Percentage Rates (APR) range from 5.99% to 35.99%. You could receive a loan of $10,000 with an interest rate of 8.93%, an origination fee of $200, for an APR of 9.80%, which would result in total payment of $12,435 with 60 monthly payments of $207.20. Your actual rate may differ and depends on your credit history, loan amount, and term. Total approved loan amount reflects origination fee, which ranges from 0% to 5%. *Within 24 hours of your loan approval, loan proceeds will be available to pay the creditors named on your Truth-In-Lending Disclosure.

* Universal Credit Terms and Conditions:  

Personal loans made through Universal Credit feature Annual Percentage Rates (APRs) of 11.69%-35.99%. All personal loans have a 5.25% to 9.99% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. Loans feature repayment terms of 36 to 60 months. For example, if you receive a $10,000 loan with a 36-month term and a 28.47% APR (which includes a 22.99% yearly interest rate and a 7% one-time origination fee), you would receive $9,300 in your account and would have a required monthly payment of $387.05. Over the life of the loan, your payments would total $13,933.62. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early. Personal loans issued by Universal Credit's bank partners. Information on Universal Credit's bank partners can be found at https://www.universal-credit.com/bank-partners/.

* LendingClub Terms and Conditions:

A representative example of loan payment terms is as follows: you receive a loan of $13,411 for a term of 36 months, with an interest rate of 12.16% and a 5.30% origination fee of $711, for an APR of 15.99%. In this example, you will receive $12,700 and will make 36 monthly payments of $446.46. Loan amounts range from $1,000 to $40,000 and loan term lengths are 36 months or 60 months. Some amounts and term lengths may be unavailable in certain states. APR ranges from 8.05% to 35.89% and is determined at the time of application. Origination fee ranges from 3% to 6% of the loan amount. Lowest APR is available to borrowers with excellent credit. Advertised rates are subject to change without notice. Loans are made by LendingClub Bank, N.A., Member FDIC (“LendingClub Bank”), a wholly-owned subsidiary of LendingClub Corporation, NMLS ID 167439. Loans are subject to credit approval and sufficient investor commitment before they can be funded or issued. Certain information that we subsequently obtain as part of the application process (including but not limited to information in your consumer report, your income, the loan amount that your request, the purpose of your loan, and qualifying debt) will be considered and could affect your ability to obtain a loan from us. Loan closing is contingent on accepting all required agreements and disclosures at Lendingclub.com. “LendingClub” is a trademark of LendingClub Bank.

* OneMain Financial Terms and Conditions: 

You must complete a loan application and continue to meet any criteria used to select you for a loan offer. Not all applicants are approved. Loan approval and actual loan terms depend on applicant’s state of residence and ability to meet OneMain Financial credit standards such as a responsible credit history, sufficient income after monthly expenses, and if applicable, availability of eligible collateral. 

Not all approved applicants qualify for larger loan amounts, lower APRs, or the most favorable loan terms. For example, larger loan amounts typically require a first lien on a motor vehicle that is no more than ten years old, meets our value requirements, and is titled in applicant’s name with valid insurance. APRs are generally higher on loans not secured by a vehicle. Example Loan: A $6,000 loan with a 24.99% APR that is repayable in 60 monthly installments would have monthly payments of $176.07.

OneMain charges origination fees allowed by law. Depending on the state where the loan is opened, the origination fee may be either a flat amount or a percentage of the loan amount. Flat fees vary by state, ranging from $25 to $500. Percentage-based fees vary by state, ranging from 1% to 10% of the loan amount subject to certain state limits on the fee amount. For information about these fees and minimum and maximum loan sizes available in certain states, visit omf.com/loanfees.

Current OneMain Customers: Loan offers presented to a consumer assume the individual has no active loan with OneMain or one of its affiliates. If a customer applies for a new loan offer, a OneMain representative will discuss available options.

Active-duty military, their spouse or dependents covered by the Military Lending Act (MLA) may not pledge any vehicle as collateral. If you are covered by the MLA, you are not eligible for secured loans.

Loan proceeds cannot be used for postsecondary educational expenses as defined by the CFPB’s Regulation Z such as college, university or vocational expense; for any business or commercial purpose; to purchase cryptocurrency assets, securities, derivatives or other speculative investments; or for gambling or illegal purposes.

Time to Fund Loans: Funding within one hour after loan closing through SpeedFunds® must be disbursed to a bank-issued debit card. Disbursement by check or ACH may take up to 1-2 business days after closing.

* Splash Financial Terms and Conditions:  

Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are subject to change at any point prior to application submission. The information you provide is an inquiry to determine whether Splash’s lending partners can make you a loan offer.

*Splash marketplace loans offer fixed rates between 10.95% to 24.51% APR as of April 7, 2024. Personal loans have an origination fee of 3.99% to 7.49% which may be deducted from the loan proceeds. Lowest rates are reserved for the highest qualified borrowers. Lowest rates may require autopay and may require paying off a portion of existing debt directly. The autopay reduction will not be applied if autopay is not in effect. Not all rates and amounts available in all states. Not all applicants will qualify for the full amount. Residents of Massachusetts have a minimum loan amount of $6,000.

To qualify, a borrower must be a U.S. citizen or other eligible status and meet lender underwriting requirements. Splash does not guarantee that you will receive any loan offers or that your loan application will be approved. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, creditworthiness, income and other factors.

¹ To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

² Loans feature repayment terms of 36 to 60 months depending on the lender and your qualifications. For example, if you are approved for a $10,000 loan with a 36-month term and a fixed APR of 17.98% (which includes a 14.32% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a monthly payment of $343.33.

³ While funding may be as soon as one to two business days, at times it could take up to two weeks.

Splash Financial, Inc. (NMLS #1630038), NMLS Consumer Access. Equal Housing Lender. Splash Financial, Inc. is licensed by the Department of Financial Protection & Innovation under the California Financing Law, license number 60DBO-102545. Splash® is a registered trademark of Splash Financial, Inc.

* Santander Bank Terms and Conditions

Personal Loans are subject to individual approval and meeting our credit standards. Your primary residence must be located in AZ, CA, CT, CO, DC, DE, FL, GA, IL, IN, MA, MD, ME, MI, MN, MO, NC, NJ, NH, NY, OH, OR, PA, RI, TN, TX, VA, VT, or WA. The fixed loan Annual Percentage Rate (APR) will depend on your creditworthiness and use of automatic payments (ePay) from any deposit account. The APR on a Personal Loan will increase by 0.25 percentage points and the payment will increase, if ePay is not elected or is discontinued. Fixed loan APRs (with ePay) range from 7.99% to 24.99% and are subject to change without notice. Loan amounts range from $5,000 to $50,000. Loan repayment terms range from 36 months to 84 months. All terms are subject to change without notice. Personal Loans cannot be used to finance post-secondary educational expenses.

Personal Loan Monthly Payment Example: For a personal loan of $20,000 with a 60-month term at 15.49% APR, the monthly payment amount is approximately $480.96 to repay your loan in 60 payments. This example is an estimate only and assumes all payments are made on time.

Based on the time your application is received, same-day funding is available in many cases, depending on your creditworthiness and the funding instructions you provide.

Santander Bank, N.A. is a Member FDIC and a wholly owned subsidiary of Banco Santander, S.A. ©2024

Santander Bank, N.A. All rights reserved. Santander, Santander Bank and the Flame logo are trademarks of Banco Santander, S.A. or its subsidiaries in the United States or other countries. All other trademarks are the property of their owners.