Peer2Peer lending tips
Before you sign-up. Make sure you have all pay stubs, bank statements and other financial information ready. You will need to verify employment records and bank accounts. Your credit score. Your credit score will likely be the determining factor on how high of an interest rate you pay. If you have no credit, you will have more risk attached to you. There are a lot of lenders who will gladly take on that risk in exchange for a high interest rate.
Sign up for a Peer2Peer site. Prosper.com has lead the way in Peer2Peer lending but there are other names you should consider. If you pay back the loans you receive, you will get credibility among lenders on this site. Even if you have bad credit after you receive and pay back your first loan, you will get a lower interest rate because you have proven that you are able to pay back loans.
Shop for interest rates. Peer2peer lending is great because it allows you to connect with thousands of potential lenders who all compete to get you as a borrower. They will often bid interest rates to you and you can scroll up and down to decide which bid you choose. Even if you are desperate for a loan, get as many bids as possible to secure a low interest rate. Sense you don't have credit, you will likely have a higher interest rate.
Stay away from shady sites. There are plenty of illegitimate sites on the internet that claim to give low interest loans to those with no credit, but only those who charge a reasonably high interest rate should be considered. Stay away from any website that is based overseas or not accredited by the BBB.
Paying back loans. If you want to re-establish a credit history and establish credit on Peer2Peer lending sites, you have to make consistent payments. Even if you only have the money to pay a small amount each month, consistency counts.
BBB. Before you consider starting an account on a Peer2Peer site, make sure to verify that they have been acknowledged by the BBB for being an accredited company. Also, if you see a lot of complaints, don't take that too seriously. Most sites that have been around a while, tend to have more complaints on the BBB and each complaint should be taken with a grain of salt as they deal with thousands of customers per day.