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  1. #1

    Is Peer-to-Peer Lending Safe?

    Some good introductory thoughts on Peer to Peer lending in this NASDAQ article.

    P2P lending can be as safe as you make it. For those new to P2P lending, experts suggest starting conservatively and also diversifying your investments. In other words, donít lend all your money to one borrower. Instead, hedge your bets by lending just a bit of money to many borrowers. This is the best way to protect yourself against one devastating default, according to most experts. You can opt to invest in only a portion of a borrower's request on Lending Club or Prosper. The straightforward logic behind this is that itís unlikely that all of these borrowers would default on their loans.

    Prosper claims that, since 2009, investors with 100 or more loans in their portfolio have never lost money. Moreover, rather than having P2P investments serve as the main source of your income, experts recommend that they constitute just a fraction of your larger investment portfolio.

    Background checks serve as another security blanket: websites like Lending Club perform background checks on borrowers, which eliminate a lot of the mystery associated with lending money to someone youíve never met before. Youíll know the credit score of whomever you are lending money to, along with other pertinent facts about their financial background.
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  2. #2
    I think that for a business lending is a great option but one must be very careful since it must be paid back regularly. I also believe that thinking big and trying to gather more funds is a good idea because the risk of spending the little you borrow and not growing is out there.

  3. #3
    Junior Member
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    I actually had to take advantage of P2P lending through Lending Tree. Due to a variety of unfortunate circumstances I was in debt up to my eyeballs. Took out a P2P loan and paid off the credit cards in question. My credit rating soared back to where it was and all was great. The only risk is taking out a P2P loan and not cutting up the credit cards.

  4. #4
    This may be a dumb question but is p2p lending where you get messages on your Kickstarter asking you to donate to another project and in return they tell you they will also contribute to yours or is that something different?

  5. #5
    Quote Originally Posted by Jax_Cavalera View Post
    This may be a dumb question but is p2p lending where you get messages on your Kickstarter asking you to donate to another project and in return they tell you they will also contribute to yours or is that something different?
    Not that I'm aware of. This is an informative video which helps explain the idea behind p2p lending.

    https://player.vimeo.com/video/88821183

  6. #6
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  7. #7
    Ahh yeah that makes a lot more sense, thanks for the explanation ^ ^

  8. #8
    Junior Member Jordan Ale's Avatar
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    After getting involved with the crypto currency community I think so. It seems like if you do your research and can put a face to the account your lending to, there is some sort of accountability.

  9. #9
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    I agree with making sure to be able to put a face to the account. It makes everything a little less scary.
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  10. #10
    Thanks for the info, learning so much, seems risky somewhat

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