Aug/080
Loan Money to Others and Earn Interest with Prosper
Prosper is an online community where lenders find borrowers. By lending money to other people, you can receive interest on the loan and actually profit just like the banks do.
Lenders bid on loans by selecting the lowest interest rate they are willing to give to a buyer along with an amount they’re willing to give (anywhere from $50 to $25,000). Prosper then packages the lowest interest rate bids together to form a loan for the borrower.
If a borrower fails to pay back the loan, Prosper will ding his credit score and assign a collection agency. At the very worst (if the borrower defaults), you will receive the proceeds of the loan’s sale to a debt buyer. By spreading out small loaned amounts over a number of loans (diversification), you’ll gain a more reliable return.
Prosper is a great way to invest your money and get a significant return on it, although it’ll take some time to receive your profits due to the nature of loans.