The company connects borrowers with investors who lend them the money, and it charges an origination fee. The minimum credit score requirement is 600, there is no minimum income requirement and borrowers need to have only one year of credit history. But borrowers currently have an average credit score of 665, annual income of $85,000 and a debt-to-income ratio of 19.3%, according to the company.
As with other online peer-to-peer lenders, borrowers are assigned grades when they apply, and they receive interest rates based on those grades. The grades also help investors decide whether to fund a borrower’s loan. The grades are available on Peerform’s website.
Applicants fill out a form online and provide credit and income information. Would-be borrowers usually receive a soft credit check (which doesn’t affect credit score) to get a rate quote. They then get a hard check (which can affect credit score) before the loan is approved.
It typically takes a few business days to receive a loan, but it can take up to two weeks.
» MORE: Peerform and other personal loan companies
What makes Peerform different
Peerform offers loans of up to $25,000 to poor-credit borrowers. That’s similar to the amounts offered by other online lenders, but higher than what you’d typically get at a bank.
Its APR range is competitive, from 7.12% to 29.99%. But keep in mind that if your credit isn’t great, you’ll most likely get rates on the upper end of that range.
The company reports loan payments to credit bureau TransUnion, so your credit score may improve if you make your payments on time. Some lenders report repayments and late payments to all three credit bureaus, but many do not.
Peerform doesn’t offer any flexibility around payment due dates, but it doesn’t have a prepayment penalty and it gives borrowers a 15-day grace period before charging a late fee.
The New York-based lender is relatively new to the world of online lending, having made roughly 4,000 loans since 2014, according to Mikael Rapaport, Peerform’s CEO and co-founder.
Here’s what else you need to know before applying for a Peerform personal loan:
Peerform’s credit standards
- Minimum credit score required: 600
- Minimum gross income required: None
- Minimum credit history: 1 year
- Maximum debt-to-income ratio: 40%
Peerform’s lending terms
- APR range: 7.12% to 29.99%
- Minimum loan amount: $1,000
- Maximum loan amount: $25,000
- Loan duration: 3 years
- Time to receive funds: 3 business days, up to two weeks
Peerform’s fees and penalties
- Origination fee: 1% to 5% of loan amount
- Prepayment penalty: None
- Late fees: Greater of $15 or 5% of payment amount
- Personal-check processing fee: $15
- Other fees: $15 unsuccessful payment fee
Peerform review: The bottom line
Peerform is among a number of online lenders that cater to people with low credit scores. Most online lenders let you check your APR with only a soft credit check, and some don’t charge an origination fee, so shop around for the lowest rate and fees before you settle on a personal loan.
Rapaport says that a majority of Peerform borrowers take a loan from the company to pay off or consolidate debt.
If you’re borrowing to consolidate debt, remember that the loan makes sense only if it gives you a lower interest rate than your current debt or helps you pay off your debt faster. Always have a plan of action to get out of debt before you borrow money to consolidate.
More from NerdWallet:
Personal loans: Compare best rates and lenders
Personal loans for debt consolidation
Amrita Jayakumar is a staff writer at NerdWallet, a personal finance website. Email: ajayakumar@nerdwallet.com. Twitter: @ajbombay.
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