What happens if a borrower passes away during repayment?

If a borrower passes away during the repayment of their loan, we work with the executor of the estate to recover any unpaid amounts.

Depending on the size of the estate and the other liabilities, we may not be able to recover the outstanding amount of the loan. If the estate does not include sufficient assets to repay the outstanding loan in full or the estate allocates its assets to other liabilities, we will treat the unsatisfied portion of the loan as charged-off with zero value.

In addition, if a borrower passes away near the end of the loan’s term, it is unlikely that any further payments will be made on corresponding Notes because the time required for the probate of the estate may extend well beyond the loan maturity date.

If we can recover any funds from the estate, we’ll apply the amount received as a payment toward the remaining balance of the loan. If we are unable to recover funds from the estate, this would be a loss for the investors who funded the loan.

If you would like to learn about the risks of investing in Notes, read our Prospectus, an official document detailing all the key information for the investments we offer. You can find the Prosper Prospectus on our website at the bottom of any page at www.prosper.com.