According to the Prosper website, the company has issued $16 billion in loans to more than one million customers – making them a reputable lender. If you are looking to take out a loan, read on to learn why Prosper might just be for you.
Peer-to-peer lending (P2P) is a way for people to lend money to individuals or businesses. You - as the lender - receive interest and you get your money back when the loan is repaid. But P2P lending can be much riskier than a savings account.
Advantages of P2P lending for borrowers
Peer to peer lending is one of the most simple and effective ways I've ever found to make passive income. It has outperformed my stock picks, selling old baseball cards, my own business ideas – everything. I've earned more money through it than I've earned at anything else except my day job.
Perhaps the most significant difference between Prosper and Lending Club is borrower qualifications. Lending Club requires a higher credit score, lower debt-to-income ratio, and longer credit history. In contrast, Prosper has developed a proprietary scoring formula called the Prosper Score.
To verify a borrower's income, we will request documents such as recent paystubs, tax returns, or bank statements. To verify a borrower's employment, we may contact the borrower's employer or use other databases.
Nevertheless, peer-to-peer lending comes with a few disadvantages:
You MUST know the risks – peer-to-peer lending isn't for everyone
The Advantages and Risks of Investing in Peer-to-Peer Loans
Peer-to-peer lending, also known as P2P lending, is an online system where individual investors fund loans (or portions of loans) to individual borrowers. ... For example, some borrowers might be able to find a personal loan where they may have been denied by other lenders.
However, there are ways to minimize the risk. Lending money is a risky affair. ... Since peer-to-peer (P2P) lending is a relatively new concept and the RBI regulations for the P2P sector are barely about a year old, here are five effective ways in which you can reduce the risk to ensure getting your money back.
What dollar amount of loans have Lending Tree & Prosper (P2P) dispersed so far? They have dispersed 3.4 trillion dollars worth of loans so far.
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