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Sunday, February 10, 2008

Many money from P2P Lending

Many money from P2P LendingThere are actually quite a few companies around the globe that offer P2P lending. You may want to consider diversifying a bit by purchasing loans from regular people like yourself after consdering the high returns of upto 12% for your money. Some of the peer-to-peer lending sites that have sprung up recently are:

1. LendingClub, Currently, LendingClub "lenders" are earning an average of 12.15%
Lending Club gives $25 bonus for new borrowers or lenders.

2., Zopa "investors" are earning "up to 5.1%,"

3. Prosper - Offers $25 bonus for new lenders, Prosper lenders are earning from around 9.49 to 12.81%.

4. Loanio, which is not yet live.

5. Kiva, offers loans to people in 3rd world countries; lenders only receive their principle back, but do not earn interest. This is seen mostly as doing something good with your money and giving people an opportunity they may not have otherwise had.

These P2P sites works in the following way. Potential borrowers need money, for business expansion, debt consolidation, etc. These sites do thorough credit checks, gives borrowers a credit rating, and then lets potential "lenders" bid on their loans. "Lenders" can bid a minimum of $50 to a maximum of $25,000. When bidding, "lenders" specify the lowest interest rate they are willing to accept from the borrower. The lowest bids are accepted, and when, within a specified time (sort of like in an Ebay auction), the borrower's full amount is funded, the loan begins. The borrower makes monthly payments, which the "lenders" collect. P2P sites charge the borrower a fee and also takes a small percentage of the repayments.

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