@Anonymous wrote:Unfortunatlely, I understand your predicament. Unfortunately, most banks don't do small loans and will refer you to a consumer finance company. Finance company reporting will hurt your score, so don't so it. If you are a ember of acrdit union, their loan limits may be somewhat smaller
Interesting. When my FC account was reported paid and closed by experian, my FAKO actually dropped 10 points. (this was with WFF, and it reported as an installment account.) The account was only about a year old, and nothing else had changed on my report (I keep very close records of each report I pull, and do line-by-line comparisons to help me understand what changed and its effect on my score). There were no late payments at all on it.
Will be interesting to see what happens to my actual fico when that payoff reaches EQ.
I do have other installment loans on mine.. I have an auto loan, another auto loan and a boat loan that were paid 3 and 1 year ago respectively, and another FC loan from CitiFinancial that was reported paid a month or so, but didn't have any impact on my score at all when it reported the payoff / closure.
As for prosper... Though I've not actually received a loan from them, I looked into it, even going as far as creating account, whereby they pull your credit score and assign you a grade that is reported to potential borrowers when they view your request. (Note that this is a SOFT pull... it doesn't create a hard inquiry unless your loan is actually FUNDED, so it doesn't even hurt to put in a request.)
The one thing to watch out for is the rate caps for your state. There are some states such as mine that cap interest rates at a low enough figure that it would be very difficult to find enough people willing to give funds to your loan request at that interest rate cap if you have sub-prime credit. But there were only a handful of states that this could come into play; most of them cap out near or well beyond what you'd expect for a rate.
You bring up a good point though: People should be aware that it's not just the interest they pay; they also pay a fee to prosper up front. So even though you might get a 5k loan, you only receive about 4850, but you're still paying interest on, and repaying, the full 5k, which bumps up your true APR a tad.
A lot of what I saw on there was either people looking for funding for new businesses or investment type stuff, or individuals who, after reading - or trying to, anyway - their stories, even though they report C or even B credit, any smart lender wouldn't touch them with a ten foot pole. And apparently a lot of lenders feel the same... many of these people indicate that they are re-listing or trying again because their first attempt didn't receive enough funding bids.
As a borrower, heck... you really have nothing to lose, if you don't mind paying prosper their percentage off the top and paying high interest rates. It's great for those with sub-par credit, because it gives the borrower an opportunity to tell their story and explain their situation, and the borrowers don't just see a score and say yes or no... it's the individuals who say yes I will bid some money for your loan or no I won't... not an underwriter's computer. But if you have prime credit, it seemed you could get better interest rates at your local bank or credit union, and without paying the juice off the top.
Yes, their docs say that they report to the credit bureaus, as well as some pretty hefty fees if you're late on a payment.
As for prosper... Though I've not actually received a loan from them, I looked into it, even going as far as creating account, whereby they pull your credit score and assign you a grade that is reported to potential borrowers when they view your request. (Note that this is a SOFT pull... it doesn't create a hard inquiry unless your loan is actually FUNDED, so it doesn't even hurt to put in a request.)
The one thing to watch out for is the rate caps for your state. There are some states such as mine that cap interest rates at a low enough figure that it would be very difficult to find enough people willing to give funds to your loan request at that interest rate cap if you have sub-prime credit. But there were only a handful of states that this could come into play; most of them cap out near or well beyond what you'd expect for a rate.
You bring up a good point though: People should be aware that it's not just the interest they pay; they also pay a fee to prosper up front. So even though you might get a 5k loan, you only receive about 4850, but you're still paying interest on, and repaying, the full 5k, which bumps up your true APR a tad.
A lot of what I saw on there was either people looking for funding for new businesses or investment type stuff, or individuals who, after reading - or trying to, anyway - their stories, even though they report C or even B credit, any smart lender wouldn't touch them with a ten foot pole. And apparently a lot of lenders feel the same... many of these people indicate that they are re-listing or trying again because their first attempt didn't receive enough funding bids.
As a borrower, heck... you really have nothing to lose, if you don't mind paying prosper their percentage off the top and paying high interest rates. It's great for those with sub-par credit, because it gives the borrower an opportunity to tell their story and explain their situation, and the borrowers don't just see a score and say yes or no... it's the individuals who say yes I will bid some money for your loan or no I won't... not an underwriter's computer. But if you have prime credit, it seemed you could get better interest rates at your local bank or credit union, and without paying the juice off the top.
Yes, their docs say that they report to the credit bureaus, as well as some pretty hefty fees if you're late on a payment.