I have recently found the most unique website I have ever seen. I think this is huge for entrepreneurs or small business owners who need some financial help. The website is www.Prosper.com, this is a eBay style peer to peer lending website. That is right, this is a website where individuals can apply for unsecured loans up to $25,000 and get competitive rates from other people who are willing to fund the loan.
First, of all from a business standpoint this is a pure genius business model. Prosper.com Was founded by Chris Larsen, who for quite some time was the CEO of Eloan. The way Prosper.com makes their money is they take 1% of the loan at time of closing from the borrower and they charge the loaner .5% of the annual interest.
From a borrowers standpoint there are a couple of things that make Prosper unique.
- First of all, all loans are amoratized and can be paid off early with absolutely no penalty.
- The terms of the loan are straight forward. You can even pick the terms you want, it is up to other lenders to decide if they like your terms and are willing to fund your loan.
- The loan is unsecured, rates are typically competitive compared to other unsecured loans.
- The loan process is relatively quick and easy.
- You are dealing with individuals versus corporate banks, this will allow you to appeal to individuals emotions in order to get your loan.
- If you have bad credit or no credit you have an equal opportunity of getting your loan. Anyone can get a loan!
- You can borrow up to $25,000 at any one time, and you will have up to 3 years to repay the loan.
- You can borrow as part of a group and get better rates versus just borrowing on your own.
I am just impressed with this whole concept. What a great business model for Propsper.com. What a great way for people to help people in need.
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