Peer to peer lending

[malmo]

Anyone ever heard of it, or done it? Interesting concept.

http://www.prosper.com/

[tandfman]

I didn't dig too deeply into that site, but it sounds as if it would be beyond my risk tolerance.

[Jack Slocombe]

Looks like a damn good way to loose good money being a good guy.

[MJD]

My brother takes the same kind of fees to put money together with deals but there is no auction process and he takes 10% of every deal so people know his money is on the line too.

[eldrick]

it truely is amazing, man's capacity to find new ways to make money !

i haven't delved too deeply into that site, but is it basically an individual lender acting as a "bank" being a loan provider ?

[MJD]

No-the site acts as a middle man. You would have to be a complete moron to loan money this way.

[malmo]

I don't know about that Martin. Go to the lenders video and listen before you speaks. It seems to be a much more efficient model than brick and morter banking. P2P does the same loan vetting as the banks for each loan and allows its investors (lenders) to customize their risk portfolio.

The best businesses to be in are banking and insurance for a reason. Lets face it, capitalism is based on one principle no matter what the asset - lenders through and intermediary provide funds to borrowers for a return that is commensurate to the relative risk involved in the transaction.

http://www.prosper.com/help/video/lender_panel.aspx

[malmo]

it truely is amazing, man's capacity to find new ways to make money !

It's already been done in the UK.

http://www.zopa.com/ZopaWeb/

[eldrick]

No-the site acts as a middle man. You would have to be a complete moron to loan money this way.

i'm sorry to be a pest ( i haven't got the energy to see the wood for the trees at the moment )

is it possible you coud just jot down a quick paragraph about how all this works ?

[eldrick]

The best businesses to be in are banking and insurance

malmo

I know you have a nice collection of finance books. I've been looking for a good book on history of banking upto modern day ( nothing overly technical ) to get a better insight. Have you come across such ?

If so, could you kindly post an Amazon link

[malmo]

I don't, but I'd be willing to bet http://www.traderslibrary.com/ has exactly what you're looking for.


Here's how peer2peer works.

1) all borrowers and lenders are anonymous.
2) borrowers request loans (up to 25k)
3) like a bank loan they submit to credit/employment checks
4) lenders bid on loans ($50 or more) in a dutch auction to determine rates
5) when a loan is funded all of top bidders share in the loan
6) payments are delivered monthly to lenders

Here are the stats for the top individual lender

http://articles.moneycentral.msn.com/Sa ... Loans.aspx

[guru]

Why would anyone with at least reasonable credit take out a loan at an average 26.4 %?

[huh?]

malmo

I know you have a nice collection of finance books. I've been looking for a good book on history of banking upto modern day ( nothing overly technical ) to get a better insight. Have you come across such ?

If so, could you kindly post an Amazon link

And while he's at it, would you like him to fetch you a beer?

You seem to be saying that his simply telling you the name of the book and the author wouldn't be good enough--you're too lazy then to find it on Amazon yourself and you expect him to do that for you! Do you have something on malmo that the rest of us don't?

[eldrick]

Many thanks malmo for that great link ( WoW ! ) & explanation of this lending business

I didn't realise that you may get a "syndicate" of guys funding the loan, all at slightly different interest rates, so the risk of lending is shared by a group rather than an individual

very interesting business concept...

[eldrick]

You seem to be saying that his simply telling you the name of the book and the author wouldn't be good enough--you're too lazy then to find it on Amazon yourself and you expect him to do that for you!

i have trawled thru amazon in the past & it got very time consuming & i didn't really find what i was looking for

malmo, from his previous posts seems to be involved quite significantly in trading/investing

it makes sense, therfore to ask him for such, as if anyone here ( along with mjd ) may have have come across the right book, it'll be malmo/mjd