Consumer Finance

Prosper, HomeAdvisor Overhaul Home Improvement Financing

Homes might not have been a great investment seven or eight years ago, but now that the housing market has more or less stabilized, homeowners looking to get to work on that new addition have even more help on the financial front.

Prosper Marketplace and HomeAdvisor announced Monday (March 14) that they had finalized a deal to embark on a partnership that will allow the latter's customers to access financing for home improvement projects, even at the point of sale. Prosper CEO Aaron Vermut explained that this collaboration with HomeAdvisor can connect people with more favorable lending options than have previously been available to the average homeowner.

“Home improvement projects are a great way to increase the value of a home, but not all homeowners have access to home equity lines of credit as a financing option," Vermut said. “Prosper offers people the opportunity to borrow money at rates that are typically lower than credit cards – it’s a smart financing option that can help homeowners improve their property while staying in financial control.”

The deal is set to last three years, though recent activity in the home improvement loan space — Prosper reported that the number of loans doubled in 2015 — could make the partnership profitable enough for both sides to continue working together in 2019. At the very least, HomeAdvisor CEO Chris Terrill noted that the end of winter and the beginning of "home improvement season" should deliver some early returns for the companies.

By not requiring collateral and limiting loans between $2,000 and $35,000, Prosper and HomeAdvisor may indeed emerge as a more convenient and user-friendly financing option in the face of high interest rates and slow turnaround windows. Now, all homeowners need is a project to dive into and an Internet connection to find an affordable loan.

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