Credit and Employment Data

What are credit grades?

A credit grade is a letter grade that Prosper assigns you based on a borrower's credit score, for use solely in the Prosper marketplace. Prosper obtains the borrower's Experian Scorex PLUS^SM credit score, and assigns one of seven credit grades.

Here is a table that shows the equivalent credit scores for Prosper credit grades:

Grade:	AA	A	B	C	D	E	HR
Score:	760+	720-759	680-719	640-679	600-639	560-599	520-559

Borrower credit grades are posted with their listing to help lenders plan their bidding. The numerical credit score is never displayed or disclosed to anyone (including the borrower). Learn more about credit grades.

Because of the timing of recognizing and reporting late payment activity from borrowers, late payments on Prosper loans may not yet be reported to credit reporting agencies when a borrower takes a subsequent loan. As a result, a borrower's Prosper payment activity may not be fully reflected in his or her credit grade. Please refer to the borrower's Prosper activity for full details on Prosper loan payment history.

What is a debt-to-income ratio?

Part of a borrower's credit profile is a debt-to-income ratio. Debt-to-income ratio (or DTI) is a measurement of the borrower's ability to take on additional debt. This number takes into consideration how much debt the borrower had prior to their loan in addition to what their debt will be if the loan they are requesting is made. (Their debt history is part of their credit history, and is reported to Prosper in the initial credit check.) The DTI is calculated by dividing the borrower's annual income (before taxes) into their annual non-housing debt payments. It is expressed as a percentage.

Generally a DTI of 20% is at the upper end of normal when excluding housing debt. Loans with DTIs exceeding 20% are more risky—in some cases very risky—and much more difficult when trying to estimate default risk. DTI is one factor that contributes to a borrower's ability to pay back the loan, and should be considered along with the borrower's other credit characteristics.

Many borrowers state that they are planning to use their Prosper loan proceeds to pay down other debt. The DTI calculation includes both the Prosper loan and any debt they may intend to pay down. Should the borrower pay down other debt with the loan from Prosper, their actual DTI will lower than what is displayed on Prosper.

If the DTI is shown as "Not Avail." (Not Available), it may be for one of two reasons. First, it may be that Experian (Prosper's credit reporting partner) has not been able to provide a reliable number for the borrower's monthly debt burden. Second, it may be that the borrower cannot provide documented proof of income, and has stated so in his or her application.

If you are a beginning lender or unsure of how to factor in high-risk borrowers, we recommend that you stick with borrowers who have a DTI of 20% or less.

What additional credit data is available?

Registered lenders have access to additional credit data, which may give more insight into the reason why a borrower has received a particular credit grade. The following additional data comes from the borrower's credit report:

Now delinquent: The number of accounts on which the borrower is currently late on a payment. This includes any unpaid charge-offs or other derogatory balances.
Amount delinquent: Total past due amounts owed by the borrower. This includes accounts included in Chapter 13 bankruptcies, but excludes all other bankruptcies. Charge-offs or other unpaid derogatory balances are included provided the credit grantor has reported an amount past due to the credit bureau. Please note that not all credit grantors will report an amount past due with a charge-off or derogatory status.
Delinquencies in last 7y: The number of 90+ days past due delinquencies on the borrower's credit report in the last 7 years.
Public records in last 12m: The number of negative public records on the borrower's credit report over the last 12 months. Negative public records include, among other things, bankruptcies, liens, and judgments.
Public records in last 10y: The number of negative public records on the borrower's credit report over the last 10 years. Negative public records include, among other things, bankruptcies, liens, and judgments.
Inquiries in last 6 months: The number of inquiries made by creditors to the borrower's credit report in the last six months.
First credit line: The month and year the borrower's first recorded credit line was opened. Credit lines may include, among other things, revolving, installment, and mortgage credit.
Current credit lines: The number of credit lines presently current that have been reported within the last 6 months. These lines can be open or closed.
Open credit lines: The number of credit lines presently open that have been reported within the last 6 months.
Total credit lines: The total number of credit lines appearing on the credit report. Credit lines can be open or closed and may include, among other things, revolving, installment, and mortgage credit.
Revolving credit balance: Sum of outstanding balance on all open revolving credit lines reported within the last 6 months.
Bankcard utilization: Overall balance/limit ratio on open bankcards reported within the last 6 months. Calculation: (sum of total balances) / (sum of total limits)

What additional employment data is available?

Registered lenders have access to additional employment data for each borrower. The following additional employment data, which is self-reported by the borrower at the time of listing:

Employment status: The borrower's employment status. Options include: full-time, part-time, self-employed, retired, and not employed.
Length of status: The number of months and years that the borrower has had the stated employment status. If employed or self-employed, since when has the borrower held their current job or owned their current business? If retired or not employed, since when have they had this status?
Occupation: The borrower's current occupation.
Income range: The borrower's stated income range, in $25,000 increments, or over $100,000. If the borrower is employed, but "$0 or unable to verify" is displayed, it is because the borrower cannot support his or her stated income with a recent paystub and Form W-2.

What is "Prosper activity"?

If a borrower has any loan history with Prosper, the "Prosper Activity" box will appear under his or her credit and employment data box. Learn about Prosper activity.

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