Peerform: Peer-to-Peer Lending for Personal Loans

It's a tough spot to be in. You need to borrow money, be it for personal reasons, to help with some home or car repairs, or to help your small business get off the ground. But asking for financial help is daunting. Do you try the big banks that seem to make you jump through hoops? Do you ask a friend and risk tension between you? Thankfully, new peer-to-peer platforms have sprouted, helping those in need find an easier path to extra dough. One of those is Peerform. These lending platforms aim to help those who may not always get approved through traditional means. Read on below to learn more about what this company has to offer.

What is Peerform?

Since 2010, the Peerform marketplace lending platform has been a resource for those in need of financial assistance who may not qualify through traditional lending channels. At its core, Peerform is a peer-to-peer lending platform that specializes in offering personal loans for a variety of uses, including home improvements, medical expenses, wedding costs, moving and relocation costs, and debt consolidation.
What sets Peerform apart from other peer-to-peer loan options is that they have a low minimum credit score, which makes them a viable option for those with bad credit. As of the time of writing, Peerform personal loans are available in every state, except Connecticut, North Dakota, Vermont, West Virginia, and Wyoming.

How does Peerform work?

Applying for a personal loan through Peerform is fairly simple. In all, there are four major steps to this process.
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1. Fill out a loan application

Similar to just about every other peer lending platform, the first step toward getting a loan through Peerform is to complete the application process. The application asks you to provide some basic personal information, such as your full name, home address and phone number, date of birth, and income information. In addition, you’ll be prompted to create an account with an email address and password, as well as specify your desired loan amount.
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2. Complete loan selection

After you complete the loan application, you’ll be offered a series of loan options. Each available option will have its own loan terms, which means that you’ll be able to choose the repayment terms that work best for you. In particular, the loan options that you’re given might have different interest rates and monthly payment amounts.

3. Post your loan listing

Once you’ve selected the repayment terms that will work best for you, you’ll be asked to post your loan inquiry on the Peerform marketplace platform. This is where the peer lending process differs from getting a traditional bank loan. In this case, there’s a chance that investors may decide not to fund your loan.
Your loan inquiry will stay on the marketplace platform for a total of 14 days. If an investor does not decide to fund your loan during that time, you won’t receive any funding from Peerform.

4. Identity and income verification

If your loan is funded, the last step in this process is identity and income verification. At a minimum, you’ll need a government-issued ID and two recent pay stubs. However, Peerform also reserves the right to ask for supplemental documents, including social security cards, bank statements, tax returns, or credit card and utility bills.

How much does Peerform cost?

When comparing lenders, it’s important to look at their interest rates and fees. With that in mind, here’s a closer look at the rates and fees that borrowers can expect from Peerform personal loans.

The Peerform grading system

Peerform handles its rates in a unique way. Each loan request is given a grade from AAA - DDD and each grade is given a corresponding interest rate, annual percentage rate (APR), and an origination fee. Those metrics fall within the ranges outlined below:
  • Interest rate: 5.32% - 26.06%
  • APR: 5.99% - 29.99%
  • Origination Fee: 1.00% - 5.00%

Unsuccessful payment fee

Peerform encourages its borrowers to sign up for automatic payments. However, if an automatic payment is attempted and there are insufficient funds in the account or the account has been closed or suspended, those borrowers will be subject to an unsuccessful payment fee of $15 per each attempted transaction.
Though this fee might be less in some states per the state law.

Late fee

If the borrower is more than 15 days late making their monthly payment, they will be charged a late fee worth $15 or 5.0% of the unpaid monthly installment, whichever is greater.

Check processing fee

In addition to automatic payments, Peerform does allow its borrowers to pay via check. However, in exchange, they charge a $15 check processing fee for the privilege.

Peerform features

Peerform does have quite a few features that make it stand out from its competitors.

Free rate quote

If you’re considering Peerform as a lender, they do offer the opportunity to see what your interest rate could be before you officially apply for the loan. Best of all, the rate quote won’t impact your credit score because they only use a soft inquiry to gather your initial rate information.

Fixed interest rates

Peerform also only offers fixed interest rate loans, which stay the same over the life of the loan. This makes it much easier to budget for your monthly payment on a regular basis.

No collateral needed

Like most personal loans, Peerform’s loans are unsecured, which means you don’t have to put up any collateral in order to be approved.

Loan options for those with bad credit

Compared to other lenders, this peer lending platform has relatively low minimum credit score requirements. Peerform only requires a 600 FICO score, which makes it a decent option for borrowers with poor or fair credit.

No prepayment penalty

Finally, while some peer loans charge a prepayment penalty or a fee for paying the loan off early, Peerform does not, meaning that you have the option to pay off your debts sooner rather than later.

Who is Peerform best for?

Mid-range borrowers

While it’s possible to get a personal loan worth up to $100,000, Peerform currently only offers loans ranging from $4,000-$25,000. If you need a loan that’s worth more or less than those amounts, you might be better suited with another lender.

Borrowers with bad credit

With a minimum FICO score of just 600, Peerform offers lending options for those with fair or poor credit, who may not be eligible for a personal loan through more traditional financing channels. However, with that said, it’s also important to note that your FICO score will likely play a large role in determining the Peerform grade that you are given, so if you have a lower score, you may end up with higher rates and fees.

Borrowers with limited existing debt

Though Peerform does offer debt consolidation loans, which are meant to help you streamline the process of paying off existing credit card debt, they require their borrowers to have a debt-to-income ratio of 40% or less, meaning that those with quite a bit of existing debt may not qualify for a loan.

Who shouldn’t use Peerform?

Borrowers who have a co-signer available

At this time, Peerform does not allow for joint loan applications or cosigners. If you have someone who is willing to cosign a loan with you, it is best to go with a different lender. In that case, you will likely gain access to a better interest rate by applying jointly with someone who has a better credit score and financial profile.

Borrowers who are looking to refinance an existing loan

Peerform doesn’t offer any refinancing options right now. If you are looking to refinance an existing loan in order to secure a better interest rate or a different loan term, you will have to go with another lender.

Pros & cons

Pros
  • Low minimum credit score requirements: Peerform only requires its borrowers to have a FICO score of 600, which is much less than some of its competitors.
  • Offers a variety of loan options: In addition to loans for debt consolidation, Peerform offers loans for vehicle financing, home improvement, wedding costs, moving and relocation costs, and medical expenses.
  • Competitive interest rates for those with excellent credit: The rates and fees for those with a AAA Peerform grade are competitive. A 5.32% interest rate and 1% origination fee are considered very affordable.
Cons
  • Low loan amounts: As of the time of writing, you can only borrow up to $25,000 with Peerform. If you need to borrow more, you’ll have to look elsewhere.
  • No option for joint applicants: If you need a cosigner or even would just like to apply for a loan in conjunction with your spouse, Peerform is not the peer lending platform for you. They only allow for individual applicants.
  • Not available everywhere: Loans from Peerform are currently only available in 45 states. You cannot get a Peerform loan if you live in Connecticut, North Dakota, Vermont, West Virginia, and Wyoming.

Peerform vs. competitors

PlatformLoan AmountMinimum Credit ScoreAPR
Peerform$4,000 - $25,0006005.99 - 29.99%
LendingClub$1,000 - $40,0006008.05 - 35.89%
Prosper$2,000 - $40,000$2,000 - $40,0006407.95 -35.99%

LendingClub

Like Peerform, LendingClub allows you to check your rate using a soft credit pull before you apply for a loan. However, LendingClub offers a wider range of loan amounts compared to its competitor, and, notably, it also allows for joint applications. That said, you may end up paying more for the privilege of borrowing since LendingClub advertises a higher annual percentage rate.

Prosper

If you have a better credit history, it may be worth going with Prosper instead. For its part, Prosper offers a wider range of loan amounts, as well as the ability to fill out a joint application. It’s also available in more U.S. states, excluding only Iowa and West Virginia. However, again, the APR range offered by Prosper is higher than the one offered to Peerform’s most qualified borrowers.

FAQs

Where is Peerform available?
Peerform’s personal loans are available in 45 U.S. states, everywhere except in Connecticut, North Dakota, Vermont, West Virginia, and Wyoming.
What can Peerform loans be used for?
Peerform personal loans can be put towards a variety of uses, including medical expenses, wedding costs, relocation costs, home improvement, and debt consolidation.

The bottom line

If you live in one of the 45 states where Peerform currently operates, this peer lending platform can be a solid option for obtaining a personal loan, especially if you have bad credit. With plenty of potential uses to choose from and lower rates than some of its competitors, Peerform is likely to be a good option for those who only need to borrow a small amount. However, if you need to borrow more than $25,000 or want to use a cosigner, you may find Peerform setups to be limiting. With that in mind, as always, it is crucial to research all of your potential lenders before finding the one that is the best fit.

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