Alternative Lending Solutions – Peer to Peer lending
What is peer to peer lending
Peer to peer lending offers alternative lending solutions by connecting people in need of money with the ones who have it, while at the same time taking out the expensive loan agents / brokers.
P2P lending and borrowing usually takes place on peer lending sites (read our reviews) where borrowers can post loan listings which are then reviewed by investors to see if the lister meets their criteria.
The loans that are being offered on peer lending sites are unsecured personal loans.
Theses kind of loans are not backed up by real estate, meaning that the person who lends the money trusts the borrower to pay it back in full.
Due to the increased risk of losing money, lenders understandably charge higher interest rates for an unsecured loan. In spite of the higher rates, peer to peer loans are increasingly popular. Banks estimate that over 25% of US and UK households are involved in some form of p2p lending.
Will they check my Credit?
Yes, they will. But you don’t need to have a perfect credit score / history.
There are many lenders who are more than willing to lend to borrowers with a not so perfect credit history. Of course, a decent credit score may make interest rates go down considerably.
Please continue reading in the review section, where we put the top p2p lending sites to the test.