The biggest difference is that P2P lending sites are directly backed by everyday investors rather than financial institutions.
And P2P lenders often offer lower fixed APR rates than other lenders, but like mortgage lenders and credit card companies, the riskier you are as a borrower (i.e.
So you need some extra cash to get your business idea off the ground or pay off your overpriced credit card debt but not sure a bank will go for it? If you are looking for an alternative to taking out a traditional loan, then a peer-to-peer lending site could be a viable option.
Lending Club and Prosper are widely considered the dominant peer-to-peer (P2P) lending sites, but what makes them the best of the pack?
With peer-to-peer lending, everyday individuals fund small portions of loans, called notes by most P2P lending sites, and receive their principal plus interest when the borrower repays the loan.