All About Peer to Peer lending

Posted on 26 of August, 2015 by

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There has been a great revolution which social media has bought us. It is not limited to the ways we communicate but also transformed our life in many aspects. In terms of marketing strategies, products and services a lot of innovations have taken place. Every industry is coming up with some advancement. When we especially talk about the financial industry this sector has got immense advancements when compared to others. It has also touched social media growth. Peer to peer lending is a new concept which has got strong future. It is a result of financial industry and social media integration.

What is peer to peer lending?

Peer to peer lending is also called social lending. It is basically an unsecured personal loan. This is borrowed from a group or an individual, rather taking it from any financial institution or any official financial intermediary. It is a new concept which had provided a social platform that brings in borrowers and lenders together. Here people can communicate and interact with each other by directly meeting and there is nobody else’s interference. Peer to peer lending has websites. We are ones amongst those websites. In our websites, you will come across lists of bad credit cash lenders and borrowers. Borrowers can go through the lenders profile and contact those which match with their requirement. This will fulfil the needs of both the borrowers and the lenders.

Benefits of peer to peer lending

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Many benefits can be seen in this new concept of Peer to peer lending. It is helpful to both borrowers and lenders. Some of the benefits are mentioned below:

  1. The Application process is quick and easy.
  2. The process is finished within few days. It does not consume months like traditional methods of borrowing and lending. Lending and borrowing is done even for a week period time.
  3. When compared to the conventional method of loans the interest rates in Peer to peer lending are quite competitive.
  4. The Borrower can easily get a loan in a lower rate of interests than what he or she would acquire from the bank.
  5. Unlike traditional methods of saving, lender gets better cash rates.
  6. Peer to peer lending includes any amount required for a loan. There are no restrictions and limits.
  7. Banking institution has such norms where loans cannot be availed to those who require a loan of less than 50k but in Peer to peer lending there is no lower limit. Even 1k amount loan would also be given.
  8. If a person has bad credit history then no loan will be given to him if applied in banking institution but the case is different in Peer to peer lending. The chances are higher of getting loans even if you have bad credit history.
  9. Collateral or security is not asked for in Peer to peer lending. But in this case, rate of interest can be a bit higher if no guarantee is given by the borrower.
  10. The reason of taking the loan is not asked in Peer to peer lending. Loans can be taken for any use like personal use, constructing homes, buying property and even sponsoring holiday.

When we talk about real estate and stock market there are a lot of insecurities involved in it. If you want to earn good money with good ROI then Peer to peer lending is a preferred option. If you have understood the concept nicely then you would realize that it is not at all a new concept. It has derived from the ancient times. With strengthen communications the profits become high with investments. This platform is proven to be the best for borrowers as well as lenders. There is no involvement of middleman like in banks. It has benefitted the parties a lot. When you check out wis-schooner.org you will see a lot of groups working. We give a chance to everybody.

To get started you need registration

If you want to be one of the prospective lenders then you have to get yourself registered in the peer to peer group. You can do this either online or in person. There is a nominal fee which has to be paid by you and apart from this you will have to give your credentials (identity). After all this is done you will be verified legitimate investor. Now you can start with lending and bidding money to the strong borrowers. If you want to make high profits then higher risks are involved and so are the higher amount to be lend. High risk lending involves high returns and vice-versa.

Find borrowers and understand the working

There is no such rule involved in this concept. It is very easy and simple to understand. If you lend money to some borrower then you have to check his strength to pay back. This can be only done through experience. Now you must be confused with the word experience. It means that you have to check the past details of the borrower, its financial records in the past and their employment status. This will also let you know, for what reasons borrower takes money for which will help you in deciding whether money should be given to him or not.

Creating risk tolerance portfolio and spreading out the risks

If you want to earn money safely and good in an amount in Peer to peer lending, then the best way is to opt for spreading out your money to many borrowers. Giving money to one borrower would have 100% of risks but give too many would reduce the risk. Say out of 10 if 1 or 2 borrowers do not pay back then the risk would be lower than compared to giving money to one. This is the reason why risk tolerance portfolio is created. Borrowers are rewarded and given good reviews if they fulfil the expectations of lenders. This helps borrowers in creating good credit history. You being a lender should be a smart investor. You should spread your money. This should be done in such a way that you get good returns on your investment.

For this, you should lend out your money to people who have very good credit history and also mediocre credit history. This will help in balancing your portfolio and borrower’s portfolio as well. It would clearly show that you lend money to all those who are in the actual requirement. In our Peer to peer lending group if you want to become a good lender then it is a must to creating risk tolerance portfolio and spreading out the risks by lending too many borrowers. You should also know about balancing P2P money account every month. This would help you in looking your money graphs going up and down. This would help you in building a lot of money every month thus ensuring that your portfolio is also enhanced.

In recent times, Peer to peer lending has gained a lot of popularity. But you must also know that it follows every method legally nothing is illegal.

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The transactions under Peer to peer lending are mutual i.e. two ways and are also executed under credit union supervision. Lenders will be given a chance to even give money on high interest rates. But if you compare these rates with the regular bank savings account then it would be quite less. It will be beneficial for borrowers as they get a good amount of loan without formalities in good rates and also for lenders as they earn quite well by involving any intermediary source.

To get Peer to peer lending concept more clearly look into the following points.

On our website, wis-schooner.org entire information will be given to on how to work. We also facilitate with all the information you need about Peer to peer lending and fully cater to your requirements. Here you will never lose your hard earned money as you have a backup of the credit union. This is an advantage being a lender. On the other hand being a borrower you will never pay unexpected and unnecessary interest rates.

Singing up for an account

You can visit our website and sign up an account as a lender. Some details will be asked for like personal details, social security number will be allotted and also you will be asked to fill in the amount which you wish to invest. Before submitting the complete profile, check it again and again. Do not make any mistakes in form submission.

Carefully selecting the borrowers

When you sign up as a lender, make sure that you choose borrowers carefully. Choose the ones who have good credit history and good reviews on their profile. When they bid see carefully the amount of interest bided by them. The level of interest rate is directly proportional to the level of risk.

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Lending money

Lending money is an easy method. You have to link your bank account with the peer to peer lending account. Thus, money can be directly transferred as and when you want.

See be clear that peer to peer lending is not all about lending or lenders. It equally involved borrowers and borrowing. So borrowers also have to be careful when borrowing some amount. When you would browse on our website a lot of information would be made available to you.