Peter, Are you considering only the borrowing side? It looks to me like a group of web publishing savvy investors might make some good money lending to guys who have found killer deals on websites. There are clearly few lenders who understand that game and at 10-12 times monthly net earnings the loans should be exceptionally safe. I looked briefly at the loans they are making to folks with C or D credit and I would have to say the lenders don't understand completely the level of risk they are exposed to. I do some work for a company that buys contracts on used cars made to people with this kind of credit. The standard deal is the car buyer has a 36-48 month note at 28% and the contract is sold at a 25% discount from face. However, about 35% of the contracts default at some point. It's quite an exciting game
Interesting stuff, mhdoc. I'd love to get together with you for drinks sometime and hear some stories about the car loans. I'm interested in Prosper on several levels. In fact, I have already a line of credit well into the six figures, so I don't really need it to finance. There might be advantages to it, though. I need to learn more about it. What I was thinking was that it would be cool to help webmasters to fund projects, or to fund the purchase of websites, using it. It certainly does appear that most of the people seeking loans there are desperate folks. I'm not really interested in the kind of people who are trying to consolidate debt, people can't handle their money very well. I did see a couple of requests on there of people looking to fund a website. I do think there's potential there.
This looks interesting. Being younger, my credit line is far below yours (considering you said you have six figures). I have researched this as well and have had pretty good luck so far investing from previous held funds and made a significant profit. However, my options of funding are limited to credit card and loans, which in the end can be a nightmare with that APR. Being in the red at first is very intimidating, but you aren't successful without taking risks. I will look into this and see if i can find out more about it.
What inspired you to do this? the reason I ask is because I was listed and fully funded yesterday on prosper... perhaps you saw my ad?? haha. I thought I'd give it a shot. What are your thoughts?
Curiosity mainly. I smell opportunity there, and want to explore it. PM me the url to your listing, I'd like to have a look.
I don't know... often times I'm tempted to take a loan on projects I know have a lot of potential, but, at least with me, there is a really significant boost in motivation when my own money's on the line
Everyone says this, but one of the things that attracted me to website publishing was the tiny risk involved. I can register a domain and host a sizeable website for fifty cents a month. I risk my time writing content, but compared to a real estate investment that's nothing. Obviously there are strategies, adsense arbirtage comes to mind, that involve the risk of serious loss, but there is lots of risk free opportunity available.
I'm the same way... I recognize the benefits of taking risks, but I also see a lot of alternate routes to the same end.
Um, yea, but the idea of a loan is you pay the money back whether your project works out or not. Loans just help you leverage using other people's money, you do have to pay it back at which point it becomes your money.
Yeah, I understand that and knew someone was going to reply with that, but there's something psychologically different about taking a loan versus putting up your own money. I'm only 22 and I know quite a few people who had the "idea" of paying back their loans, but didn't..
Right, but I'm thinking of this as more of a means for people to do things they couldn't otherwise accomplish.
It's very interesting on how generous these people are. I just read a project that was looking for $19,000 in a loan and was fully funded in one day. I'd like to know how this benefits the lenders and if anyone has a personal experience with this.
https://www.prosper.com/public/lend/listing.aspx?listingID=68294 I dunno... I'm feeling a little nervous about it since it got funded... it only took 12 hours at 10% interest... not too shabby. anyways, check out my site, www.firstmesothelioma.com, click some links, and make my mom happy
I have a few friends in VC and, while they are careful in their investments, anything under $500k or so is negligible to them, especially when one of those investments could potentially get them 49% in the next new thing.
Well, the lenders make money on the loans, the interest paid goes to them. As far as why do that instead of buying Google stock or something, I'm going to find out about that too as I get to know more of the people involved.
Yeah, I wish I could think that way. I see. That's a great idea. The most important thing for that site is building reputation and the group you are in, just like any other big name business site (ie. Ebay and Here in the Marketplace)