Make Money - Online loans via the Propser Marketplace

Prosper / Prosper.com is a peer to peer lending marketplace that was established in 2005. Peer to peer refers to an individual (or individual entities) providing loans to other individuals. There are no banks or financial institutions on the other end of the transaction. Here is what Prosper / Prosper.com says about themselves:

“Prosper is America’s first marketplace lending platform, with over $8 billion in funded loans. Prosper allows

people to invest in each other in a way that is financially and socially rewarding. On Prosper, borrowers list loan

requests between $2,000 and $35,000 and individual investors invest as little as $25 in each loan listing they

select. Prosper handles the servicing of the loan on behalf of the matched borrowers and investors.”

Why am I so positive, impressed and thankful for Prosper as a monetization tool for a corporation? One because I signed up as a member early on (circa 2007) so have lots of experience. And two because I’ve both borrowed and lended through Prosper. It’s the thought of 100’s of individuals (or individual entities) who only know statistics about your credit history and your story (explanation for the funding request) taking the opportunity to bid on your behalf to provide you funds in the case of a borrower.

Individuals (or entities) not banks or finance companies or credit card companies (not that there’s anything wrong with those) but the fact that people are helping other people at a reasonable but fair and profitable rate is something that just can’t be matched by a traditional financial institution.

And likewise on the lending side, having the opportunity and flexibility to bid to loan money to borrowers, based on their story, if that fits your psyche. Or based on the profile of a borrower’s credit history attributes, which you can set up as a proxy agent.

Here are a few benefits (from my perspective) for Prosper Lenders:

No minimum $ amount required to open an account
Individuals or entities can participate as lenders
A well developed and functioning loan screening tool that allows you to set the characteristics of the borrower(s) you’d like to provide loaned funds to by risk and rate of return
A low, minimum loan funding level of $25 / loan that provides you the opportunity for significant diversification in the loan portfolio you develop
Clear and thorough statements (monthly) and onscreen up to date visibility of loan status/history on the Prosper.com site

Here are a few cons (from my perspective) for Prosper Lenders:

You could lose some or all of your investment
There is a learning curve to portfolio development
Borrowers can prepay loans early which could lessen your return

Here are a few benefits (from my perspective) for Prosper Borrowers:

An opportunity to secure funding for ‘your’ need based on your credit history
An opportunity to secure funding at a very low level through the ‘lender’ bid process (as this ‘competition’ effectively ‘bids your rate down’)
Flexible loan funding levels from $2000 – $ 35000
The ability to reject or forfeit funding if the loan rate is too high
The ability to prepay the loan or pay greater than the minimum per month to more quickly payoff the loan and lessen interest fees

Here are a few cons (from my perspective) for Potential Prosper Borrowers:

Your loan request may not get funded
Your loan request could get funded at a very high-interest rate level
Loan payments start soon after you are funded the money
There is a loan (‘origination fee’) that may or may not be refundable if your loan is not funded

As I stated I have been a lender on Prosper.com since 2007. I have been pleased with my interactions with lenders and borrowers and have had no issues (save the mistakes that I’ve made) with the performance of the Prosper.com website or my loan portfolio. There is, of course, a learning curve and the opportunity to achieve higher returns, but that also means taking higher risk.

The story, in a nutshell, is that thru appropriate risk-based screening selections this can potentially be an effective monetization tool for income generation for a corporation.

And has the ability to begin providing income w/in 60 days of initial loan funding.

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Prosper Peer to Peer Lending

“Prosper is America’s first marketplace lending platform, with over $8 billion in funded loans. Prosper allows

people to invest in each other in a way that is financially and socially rewarding. On Prosper, borrowers list loan

requests between $2,000 and $35,000 and individual investors invest as little as $25 in each loan listing they

select. Prosper handles the servicing of the loan on behalf of the matched borrowers and investors.”

And likewise on the lending side, having the opportunity and flexibility to bid to loan money to borrowers, based on their story, if that fits your psyche. Or based on the profile of a borrower’s credit history attributes, which you can set up as a proxy agent.

Here are a few benefits (from my perspective) for Prosper Lenders:

No minimum $ amount required to open an account

Individuals or entities can participate as lenders

A well developed and functioning loan screening tool that allows you to set the characteristics of the borrower(s) you’d like to provide loaned funds to by risk and rate of return

A low, minimum loan funding level of $25 / loan that provides you the opportunity for significant diversification in the loan portfolio you develop

Clear and thorough statements (monthly) and onscreen up to date visibility of loan status/history on the Prosper.com site

Here are a few cons (from my perspective) for Prosper Lenders:

You could lose some or all of your investment

There is a learning curve to portfolio development

Borrowers can prepay loans early which could lessen your return

Here are a few benefits (from my perspective) for Prosper Borrowers:

An opportunity to secure funding for ‘your’ need based on your credit history

An opportunity to secure funding at a very low level through the ‘lender’ bid process (as this ‘competition’ effectively ‘bids your rate down’)

Flexible loan funding levels from $2000 – $ 35000

The ability to reject or forfeit funding if the loan rate is too high

The ability to prepay the loan or pay greater than the minimum per month to more quickly payoff the loan and lessen interest fees

Here are a few cons (from my perspective) for Potential Prosper Borrowers:

Your loan request may not get funded

Your loan request could get funded at a very high-interest rate level

Loan payments start soon after you are funded the money

There is a loan (‘origination fee’) that may or may not be refundable if your loan is not funded

The story, in a nutshell, is that thru appropriate risk-based screening selections this can potentially be an effective monetization tool for income generation for a corporation.

And has the ability to begin providing income w/in 60 days of initial loan funding.