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Peer to peer lending is often considered riskier than other forms of investment. Looking at peer to peer lending sites like Lending Club, they state the risk of investment is at your own risk and if you are not able to loss your money don’t invest. This is stated on their prospectus with the SEC and this represents the worse case scenario for investors. This admission is often enough to scare the majority of people away. So why is peer to peer lending so risky and if it so risky why are people still lending?

The overall risk is based in the nature of the loan issued. It is unsecured. Meaning, it has no real collateral backing the loan as in an auto loan or mortgage. There is only a promise to pay the loan by the borrower. This is not the only type unsecured loan today. Every credit card and store credit is an unsecured loan. These loans or lines of credit carry a high rate of interest due to the fact they are unsecured. The same is in true of peer to peer lending. Read the rest of this entry »

Are you aware that only 10% of the businesses that apply for a business loan get a get approved? I understand that things are tight and banks aren’t lending money like they use to, but this is crazy. What are these business owners supposed to do if they need money?

It used to be pretty simple to get a business loan. Over the past decade or so it seems that the banks are more interested in making risky investments than taking a chance on small businesses. This is exactly why a merchant cash advance was created; to offer working capital quickly and easily, without having to risk all of their personal assents if things don’t work out as planned.

Merchant loans have been widely received by all kinds of small business owners from just about every imaginable type of business. They have grown from just a few million dollar industry to nearly a billion dollar a year industry in a very short time. Read the rest of this entry »