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Where to Find a Peer-to-Peer Loan

I need a peer-to-peer loan. Where do I start?

I am trying to buy a foreclosed home for about $290 - $300,000. I either need a personal loan (as in peer to peer to avoid an inquiry on my credit report) of about $5,000.00 (and I will provide the remainder) or an investor willing to partner with me in purchasing the property, although no return would be seen for approximately five years when I would want to sell it. Which is the best scenario and how do I find interested investors? The property has lots of potential and would sell for much more by the time I make some aesthetic improvements. My credit score is good enough; I am just without an adequate down payment.

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Bill's Answer
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Highlights

  • Peer-to-peer loans are, loans between people mediated by a third party.
  • Consider a p2p loan as an alternative to bank financing.

You have several options. What you seek is an investor who will take a second mortgage interest in your property and will not see repayment for 5 years or more. To find such a person, you need to put out feelers in your circle of friends. You seek someone who will not only invest in the property, but a person who believes in you personally, and that you will put some sweat equity into the property so that there is a good chance of a positive return.

You are also seeking someone who has a fundamental positive outlook on the real estate market in the neighborhood you seek to buy into. You need to seek out and find such a person.

Peer-to-Peer Loan

Peer-to-peer (P2P) loans are, as the name suggests, loans between people that are mediated by a third party. In some P2P loans, the borrower writes a proposal and investors choose whether to fund the loan. In other P2P loans, an intermediary funds the loan, combines the loan with others, and sells shares in the loans to investors. Two peer-to-peer lenders are Prosper and Lending Club. (Readers: If you know of others please comment below.)

Consider a P2P loan as an alternative to bank financing.

Other Financing Options

If you have a 401(k) account, ask your 401(k) plan administrator if loans are allowed under your plan. Not all plans allow loans, or limit loans to certain circumstances. I do not recommend taking a hardship distribution from a 401(k) account unless your situation is dire.

Bills.com makes it easy to compare mortgage offers and different loan types. Visit the Bills.com Loan Resources page to find out more about the loan options available to you.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

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3 Comments

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  • RS
    Nov, 2015
    Runestar

    Hi. I'm 21 almost 22, a single mom living with friends. I just got laid off of ssi and working now. I need to get a place asap and need to know where to get a quick loan, so my baby and I can get an apartment asap. Plz help.

    0 Votes

    • 35x35
      Nov, 2015
      Daniel

      I don't know where to direct you, I am sorry to say. Unsecured personal loans generally require strong credit and stable income. The fact that you just started a job makes things hard, even if you have a good credit.

      Payday loans are a bad idea, unless you know that you can repay them on the next check. 

      Sadly there may not be a financial product that fits your circumstances. Whatever you do, don't pay a fee to some online "lender" that says anyone can qualify for a loan, but requires you to pay a fee in advance of receiving the loan. Total scam.

      0 Votes

  • 35x35
    Jul, 2010
    rachel
    great brief post- never heard of virgin- will check it out (looks very kool right off!! especially with your large network- very grass-roots if you ask me)
    • Prosper: I've lent on this one. Will need to look into to see fees, etc.
    • Lending Club: Similar to Prosper.

    http://www.allbusiness.com/10206999-1.html (brief news article)
    http://www.americanbankingnews.com/2010/06/26/how-to-get-peer-to-peer-loan-to-pay-for-college/

    2 Votes

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