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Social Lending Networks are Booming

March 15, 2009 | Personal Loans | Videos | No Comments
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Social lending networks are booming!  Internet based services such as Virgin Money, Prosper Investing / Prosper Borrowing, and Lending Club use online collaboration with credit analysis tools to match lenders with borrowers.  This creates a win-win scenario for both the lender and borrower.  Lenders get an above market rate from their investment, while borrowers get easier access to credit at a decent interest rate.

Social lending networks allows borrowers with good credit access to personal loans at interest rates more attractive than those available from conventional funding sources such as banks and credit cards.  Social lending networks use an auction style process connecting borrowers with lenders offering the best terms.

Lenders are now pumping $250,000 in capital per day into Lending Club with about 95% of loans over the past month being fully funded.  In 2008,  Lending Club generated over 2,500 loans totaling $21 million (approximately $9,000 per loan).
 
Lenders at Lending Club fund specific borrowers with an interest rate of 6.69% to 19.37%, minus a service charge of 1%. Borrowers must complete a loan request online and can instantly view the interest rate they qualify for.  It’s free to check interest rate, however there are strict credit-standards that must me met, such as a minimum FICO score of 660.  So if you have bad credit you are out of luck. The interest rate is fixed for the full three-year duration of the loan. As part of the loan application, a borrower must provide a social security number and other identifying information. 

Below are 2 videos;  the first is about getting a loan at Lending Club and the second is of the CEO of Virgin Money being interviewed on CNN about the benefits of social lending.

 

Video: Getting a Loan at Lending Club

 

Video: What Works – Social Lending

 

For more information visit LendingClub.com, VirginMoneyUS.com and Prosper Investing / Prosper Borrowing.

Related Article: Get a Personal Loan via the Internet

 

 

 

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