I signed up for Prosper early last year with the intention of trying to use it to borrow some money to pay down some other bills that had a horrible rate on them. I couldn’t get the rate that I wanted at the time and haven’t really tried to borrow on the site since.
What I have done is lent on the site. It was a pretty easy process to become a lender. Depositing money took a little longer than I had expected it to, but it managed to make it’s way there. It took me about 3 days to finally win a bid to fund a loan. The loan I ended up funding was a loan to a person with no credit. What that means is the interest rate is quite a bit higher because it carries a much higher risk. The rate on my winning bid was 22%. That’s right. I’m earning 22% (minus fees makes it about 20%) on my money. Try getting that anywhere else in the world. It’s no wonder Credit card companies, Banks and Credit Unions make so much money off of their lending.
Of course, the 22% is norm for the high risk loans, but the higher the risk, the more likely the loan is to be defaulted and then you don’t even get your original money back. The loan I funded has so far been a good one. Only late once and on time the rest. I’ve already made a little under $6 on my $50 and it’s only been about 8 months. Not bad if I do say so myself. I’m thinking pretty hard of putting a little more money into the system to see how well I can do at it.
You can give it a try also. If you sign up through my referral link (in this post or on the right sidebar) and become a lender with a funded loan in 90 days or less, we both get $25! If you become a borrower, I get a .5% bonus of the total of the loan if you get it funded in 90 days, but you don’t get anything. If you have good credit, you could theoretically borrow some money and then lend it back out at a higher rate and still get your $25 and a pretty good margin on the money.
The minimum bid on a loan is $50 so you can start relatively low to get a good feel for it. Go on over and give it a try. It’s almost addictive.