A while ago I ran into a website called Prosper.com. This website hooks borrowers up with lenders and cuts the banks out from the middle.
Prosper.com for Lenders
As a lender Prosper.com allows you to get really good interest rates for loaning out money. If someone has a poor credit history this means 20% or more. Not bad considering how much other investments and bank accounts will pay you. Of course there is a downside -- default. If the person you loaned the money to goes AWOL are declares bankruptcy you are out of the loan.
Just as any other lender, you need to diversify your loans. That means your real return will probably end up being a lot lower than 20%. What is unique is that you can choose to cover just a little bit of each person's loan. This diversification is the trick to making money on Prosper.com.
Prosper.com for Borrowers
Need to borrow some money now, to consolidate some debt? Prosper.com lets you bypass all the banks and other commercial lending institutions.
Unlike at a bank, or over a phone, on Prosper.com you are a face and a story. Having a credible story and respected profession can help that (and may be good looks too.) If you are a teacher, policeman, or in the military you are going to have an easier time getting a loan, even with poor credit.
I think that Prosper.com is one of the best deals out there for debt consolidation. There is a downside, and that is that your credit information will be published publically online. That includes your credit grade, the city you live in, if you are a homeowner or not, and what your debt to income ratio is.
If you don't have a problem with that, good luck, check it out.
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