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With banks constricting their lending opportunities for borrowers these past months, The New York Post’s video about the benefits of person-to-person lending is a short but incisive analysis of the credit program. The concept is simple: financial intermediaries are eliminated but the firm manages to match borrowers and lenders together minus the additional cost charged by banks in traditional lending schemes. The online transaction allows a borrower to seek lower interest rates, bypassing the services of a bank while in the comforts of their home.

However, the rates won’t keep getting lower. Lenders naturally have to base their interest rates with that of the central bank’s and other zero-risk investment opportunities’. After all, alternatives for newer lending practices such as P2P are always available and can be substituted at a more secured return from the government.

Prosper.comhas gained popularity with its low-fee, no prepayment penalty, and fixed-interest rate proposal. Borrowers set the maximum interest rate and lenders bid on the best rate that they can offer in return. The lowest bid wins and the borrower then receives the loan directly to his bank account. Other online lending firms like Lending Club and Loanio have their separate marketing schemes as well.

Why Choose P2P?

Borrowers strapped of needed cash can avail of loans with lower interest rates. This makes it ideal for those needing urgent financing. In fact, some institutions may offer collateral-free programs provided that potential borrowers meet certain criteria in their credit standing.

Most programs also offer fixed interest rate loans that can secure borrowers against fluctuating rates in the market. Other fees also remain low primarily because firms save from expenses on office infrastructure and funding costs.

The Drawbacks

Zopa.com in the United Kingdom is not regulated by the government but by a different agency according to one a study . Regulation in the United States has to be firmly laid out yet to assure lender confidence in their P2P transactions since this type of lending only began in 2005.

Risk assessment is still another issue that most of them have difficulty perfecting. While borrowers can be referred by friends, colleagues and former borrowers in the lending institutions, the lack of more effective credit investigation measures possessed by universal banks is another setback in their screening methods. This view is however opposed by The Economist in its issue a year ago. They see this weakness in asset-backed commercial papers issued by banks instead.

Lastly, the rate of return is not always guaranteed as many borrowers have defaulted and eventually brought down an entire company. Lenders and borrowers need to verify the fines against late payments and defaults so they can be aware of lender protection in a specific firm.

Into the Crisis

P2P Lending aims to benefit both borrower and lender. In fact, those who have lower FICO scores but manage to obtain credit in select P2P firms can improve their credit scores eventually. Now that banks have pulled their lending reins, borrowers can seek refuge to this alternative lending offer. It is sensible however to keep in mind that greed played a large factor in the excessive loan sales that spawned the crisis that we are currently experiencing. As such, proper regulation and oversight in the activities of these firms must be set uniformly much as banks do get constant monitoring as they improve risk profiling and transparency among the borrowers.

Andy Denton of http://www.Realty.com

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There are many ways to protect yourself if you are seeking a commercial loan or a refinance loan.

First, do some research online about both a commercial loan and a refinance loan. Find out your mortgage options, and also check and copy your credit report so you will be more prepared to negotiate for your commercial or refinance loans.

You should interview several lending company’s and keep a journal of what terms they are offering for a new commercial loan or a refinance loan.

Always price the other property in the area, the price should be comparable. Hire a licensed qualified home inspector, and before you sign the contract on either a commercial or refinance loan, decide who will be responsible for any repairs, the buyer, or the seller.

Never lie on the loan application for any reason. Lying on a commercial or a refinance loan application is fraud and is a criminal offense.

Never borrow more money than you can afford to pay back, or that will make your payments larger than necessary. You do not want to end up loosing your property, and the equity in it.

When taking out a commercial loan, or a refinance loan, never sign a blank document. If while reading the contract, you put a cross through the blank spaces, someone cannot add information after you sign. You will be liable for any surprises they might add.

Do not sign anything you do not understand. Take your contract to a real estate professional or an attorney skilled in commercial or refinance loans.

Always, if buying a government home, state honestly your intention to occupy the home, or if you plan to fix it up to rent or resell. Your commercial loan may be turned down if they find you have not been truthful.

Some people get refinance loans to get a lower finance rate, and often borrow more money against the equity in their home. Some lenders may make this sound too good to seem possible. If so, it generally has some kind of catch.

Make sure a refinance loan to pay off bills or for home improvement is the best plan for you, and do not let yourself be talked into something you do not want to do. Some lending companies offer a very low financing option, only for you to learn later that there is a large balloon payment due at the end of the loan. They sometimes also add more finance, but put it into your payment to fool you.

Remember, there are many good, honest lenders that can help you with a commercial loan or a refinance loan. There are also dishonest people who will try to undermine you and trick you into financing more money than what you have planned. Stick to your original budget, and do not sign a contract if it is not exactly what was presented to you. This is a business where the representatives are paid by commission, so make sure you are trusting of this person. Asking friends or the Better Business Bureau is a good place to reference lending companies if they have had bad marks, or are considered a good business you can trust.

The author is the owner of http://www.business-floor.com – U.S.A local business directory.
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Already we are seeing the results of the demise of the mortgage market due to the sub prime debacle. Lending banks have severely tightened lending criteria as their asset bases erode and the financial sector comes under huge pressure. Wall street does not like to see 2.5 billion dollar write offs from Morgan Stanley and the like. John Maudlin said in his November 9th Newsletter “Data released in the past few months, and again this week, have shown that banks and other lenders are tightening their standards for all sorts of loans. And it is not just that they are becoming more like an old-fashioned banker who actually wanted to know that he could get his money back”. (John Maudlin, Frontline Thoughts)

Start up companies and smaller operations with limited assets are the ones who have benefited over the last five years of easy money. Some company’s were even funded through second mortgages because they were cheaper and easier to get than an SBA LOC. For all but a lucky few that option is now gone.

I recently completed a very solid business plan for a client that was denied funding. At first I was surprised. But given the external factors that now affect the lending market the response from the bank will be a common one. No more easy money.

So now everyone will have to get creative to get financed. Here are my top two creative ways of finding the money when you are a small business in need:

Friends and Family -

Sometimes people look at me and say “but my friends and family don’t have any money.” Well, neither did mine when I wanted any for my business. But a funny thing about friends and family – when I approached them with a solid plan and a sample product they could see, feel, and admire, suddenly they were open to the idea. But here’s the trick: I didn’t ask any ONE person for the whole amount. I took seven different loans to get $25,000 and paid them back according to need.

So my friend who lent me her last $5000 got hers paid back first, and my grandfather, who was retired and didn’t need his $5000 right away was willing to wait. Everyone knew the payment schedule and signed their acceptance of it. When I needed the last $5000 and no ONE person had it, I had two friends who even lent me $2500 each. That’s how you can put money together creatively.

Merchant Account Advance -

Almost every business now accepts credit cards. Not only have they proven in studies to raise individual ticket sales (people will charge more than they will pay with cash), merchant accounts allow for greater flexibility for the small merchant. You don’t have to be open at 2 am to make a sale-your website can do it for you.

So now you can get money in advance of future sales. Merchant account advances are a relatively new way for merchants to access cash. Business owners get the cash they need quickly. Instead of having to worry about large monthly payments, the loan is repaid from a small percentage of each credit card sale the business makes.

There are qualifications. But if you are open for business and have consistent credit card sales this is a great avenue to explore.

If you need to raise money for your business and you can’t get a conventional loan, just take the time to think outside the box. There are several other options open to you.

My special report “15 ways to get money for your small business” can be found at my website http://www.soaring-phoenix.com In it I list several creative financing options that you can explore for your small business. Leili McKinley specializes in helping small business owners overcome financial difficulty. If you are a small business owner seeking funding or a cash flow management system, I can help. “If you have reached a plateau, we can help you grow.”

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Sometimes the process of getting a loan can seem long and drawn out. It can involve going from lender to lender and filling out countless pages of the same information. Most people are trying to get a loan because they need the money fast.

They are not wanting to spend days upon days trying to get money. People want fast loans. There are a few tricks to getting a fast loan. Borrowers just have to understand the process better in order to speed it up.

The loan process involves the lender collecting the borrowers financial and personal information. The lender is gathering this information so they can assess whether the borrower is going to be a good customer or not. They are wanting to make sure that the borrower will be able to afford to pay back the loan and that they will not default on the loan.

Some things that can slow down the process of getting a loan are a bad credit history, unverifiable employment or income, past financial issues, like bankruptcy, and current problems that could become financial issues. The lender is ultimately looking out for themselves.

They are in the business of lending money to make money and they prefer to do business with someone who has a good history of paying off their debts and who can financially afford to pay back the debt.

Borrowers can help to speed up the loan process by being prepared. Above all else they should know and understand their finical situation, including their credit history.

They need to be prepared to show documentation to back up any claims they make regarding their income, debts or credit history. This means having all statements, documentation of payments and pay stubs or other proof of income, such as tax returns.

Another part of getting a loan that can move things slowly is the process of shopping around. If a borrower is planning on shopping around it can help to hire a broker. A broker will only need to take the borrowers information one time and they will supply it to the lenders. A broker can easily and quickly find the best loan.

Another way to shop around that can make things faster is online. There are many different sources online where a borrower can compare loans. Again, like with a broker, the borrower enters information one time and they can save from having to fill out document after document.

The majority of the time the information entered can then be transferred once the borrower chooses their lender, so they will only have very limited paperwork to fill out with the lender directly.

Basically, the trick to getting fast loans lies with the borrower. Preparing documentation before hand and searching for ways to easily and quickly compare loans is a great time saver. If the borrower is prepared and if they know the smart way to shop around they can really make the process of getting a loan much faster, not to mention, much easier.

James Copper is employed as a Secured Loan Consultant by Any-Loans.co.uk who offer fast loans and secured loans.

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Person-to-Person lending (also known as Peer-to-Peer or P2P) is fast becoming an attractive way for borrowers and lenders to connect directly. It is like the EBay of the banking world. In the past, you would deposit your funds at the bank and depending on the amount and term, the bank would pay you interest. Current certificate of deposit rates range from 3.50% to 5.00% APY. Basically, the bank then makes loans with your funds and their income is based on the spread between your rate and the loan rate. Well, why let the bank have all of the fun? Now, you can lend direct and earn more interest.

There are three main services: Prosper.com, LendingClub.com, and Zopa.com. Prosper gives you plenty of details such as the credit score, Debt-to-income ratio, etc., so you can make informed lending decisions. Prosper.com allows the lender to seek additional details about the borrower, although the borrower doesn’t have to respond. Of course, then the lender doesn’t have to lend to them. Many lenders spread out their funds in $50 to $100 increments to minimize overall risk. Looking at data from Prosper (6/1/06 to 4/21/08), average rate of return for AA borrowers is 6.64%. Some people will sprinkle in some lower quality loans to try to bring the return up. Your funds aren’t guaranteed, however. With Prosper you can get started with $50.00. Certainly not much to risk, to get your feet wet.

Lending Club isn’t currently accepting new lenders. The site says, “Lending Club has started a process to register, with the appropriate securities authorities, promissory notes that may be offered and sold to lenders through our site in the future.” They use a system they call LendingMatch to suggest a portfolio of loans to the lender. It takes various aspects of your profile and matches you with borrowers that you may have a “connection” with. That connection can be you both like dogs and are MySpace addicts. The lender can override the suggestions and make their own decisions.

Zopa operates a little differently. They tie your investments in with an NCUA insured CD. They partner with various credit unions to accomplish this. As a result, your funds are insured up to $100,000, but the earnings compare with 1-year CDs. Currently they are advertising 3.75%. The minimum required to start at Zopa is $500.00. Zopa has a feature where you must agree to help at least one borrower out. You do this by reducing your earnings rate and as a result, reducing the borrowers loan rate. People helping people is the true theme of all three services. The fact that everyone mutually benefits makes it very rewarding.

I don’t think the person-to-person lending will replace other investment alternatives, but I do think it can add some return to a well-balanced portfolio. If you manage your lending portfolio well, the returns are certainly attractive compared to other investment vehicles. Our specialty will remain with quality, guaranteed returns in certificates of deposit, but I certainly believe putting some extra funds at Proper or one of the other services is a good idea.

For more information visit our Peer-to-Peer lending section on our site.

Chris Duncan is a FINRA Registered Representative. He specializes in helping clients find the best and highest CD rates nationwide. His clients include individuals, financial institutions, corporations, and public agencies. Please visit our Certificate of Deposit Rates page.

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Does your current business need a facelift? You may need to purchase new, updated equipment, do remodeling, add an addition, purchasing new fixtures for your business. Maybe you wish to start offering new services that will require you to hire additional employees. Perhaps you need to retrain your current staff to offer new services. The time has come for you to take out a business loan to cover these expenses, but where do you turn now?

Online Business Loans

The answer may be only a mouse click away. There are quality, reputable lenders who do business exclusively online who are willing to invest in your business by loaning you money to help improve it. These lenders have established websites to make the application process possible in a convenient, hassle free environment.

To apply for your business loan, you will visit the lender’s website. You will be able to fill out a secure online application on the lender’s website that will ask for general information about your business, including revenue generated, projected sales, etc.

Securing Your Business Loan

You will most likely be asked to secure your business loan with something of value, such as your own home, real estate, business property, etc. If you were to forfeit on the loan for any reason, the lender can foreclose upon the security just as they could with any other type of loan. That means that regardless of the success (or lack of) that your business experiences, you will still be responsible for repaying your business loan.

Flexible Repayment Options

You can borrow any amount that you need for business purposes. Remember, you have different options for repayment. Some lenders may offer you regular monthly payments that range from one year to twenty years or longer.

When shopping for a business loan with monthly repayments, look for one that offers a fixed rate. That means that you will always pay the same amount of interest, regardless of the fluctuations of market rates that accompany the variable rate business loan. This is especially important if your business loan is for the long term (ten years or longer). This can save you tons of money over the life of the loan.

Other payment options that you may have offered to you at the time you take out your business loan may be a payment of interest only for so many years (example: ten years of interest only payments each month) followed by a final year of a balloon payment that will be the entire principle of the loan. That means that if you borrow $10,000 you would pay interest only on the money for ten years, with the final balloon payment of $10,000 due at the end of the term of the loan.

This option works well for businesses that will need more time to realize profit on their initial investment of $10,000 – which means that the interest only option doesn’t take away from the profit during the loan’s term. The balloon payment of the entire principle, however, is something that you should consider being able to afford at the end of the term.

Jessica Peterson is a Unsecured Personal Loan Consultant with more than twenty years of experience. For more information about Guaranteed Bad Credit Personal Loans, Guaranteed Credit Cards, Unsecured Loans, Fresh Start Loans, Debt Consolidation, Student Loans and others please visit http://www.yourloanservices.com

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How many times have you wished there were some sort of magic trick that would grant you instant approval on that loan you so badly need? Being denied over and over again is extremely frustrating and can really bring a person’s confidence down. And what is more, putting your credit through inquiry after inquiry only makes your score sink lower. But what is it that you are doing wrong? There must be something, otherwise, you would have been granted a loan by now.

Obtaining finance when you are a bad credit applicant is never easy, but it is not impossible either. Having a clear idea of your possibilities and a high self-confidence is key. Learn what you are doing wrong and what steps you can take towards a successful bad credit loan application. Here you will find some ideas on how to proceed prior to applying for a loan.

Sort Out Your Credit Report

There are many sites online which offer free credit report copies. It will be a good idea for you to get one of these and spend some time checking it out, making sure that everything which appears there is absolutely accurate. It is very easy to oversee mistakes as we always assume the inputs are 100% correct. Well, they do not always are. So make sure there are no errors which might be unfairly bringing your credit down.

Make A Budget

Knowing exactly what you earn monthly and what your usual expenditures are will give you a better idea of what you can afford to pay when it comes to loan installments. This will aid you in deciding which loan offers are better for you and which are just bad deals. It is very common for people to take out a loan which ends up being more than they can handle. If you know what you can pay for and what is simply out of your league, this will definitely not happen to you.

Improve Your Credit

Often, people wait until the last second to request a loan. This is just wrong. Making rushed decisions is exactly what you do not need. If you realize your financial situation is somewhat rocky, plan ahead. Provided that you see you will need the helping hand of a lender is the months to come, try to slowly improve your FICO score before submitting an application. Even if you only enhance it a bit, it is better than nothing. There are measures you can take: pay off any due bills, close unnecessary account, pay off credit card balances, etc. It will mean a sacrifice, but it will surely boost your chances of approval in the upcoming months.

Pay Lenders A Visit

Applying for loans online is an excellent idea and can save you loads of time. But sometimes taking the time to personally visit each lender, can increase your chances of approval. It will give the lender time to get to know the person behind the credit score and the credit report. You will have a chance to explain some of your negative report inputs face-to-face, and this is invaluable. I believe it can be really hard to swallow ones pride and admit that you made a mistake and that you need a second chance, but it will earn you the trust of the people around you. It is definitely worth the effort.

Hilary Bowman is the author of this article. She works successfully as a financial advisor with years of expertise on Bad Credit Loans. Hilary publishes informative articles about bad credit personal loans, home loans, credit cards, auto loans, business loans and others at http://www.fastguaranteedloans.com

Business lines of credit are perfect for financial needs in the short-term, like boosting cash flow, finding seasonal working capital, finding inventory, materials, and equipment, and funding accounts receivable. A secured business line of credit, and an unsecured line are the two types of lines of credit for business. Fundamentally, both kinds offer the same benefit for an entrepreneur – that of providing a spring of continually accessible credit which the business can utilize for operational purposes. Both, secured and unsecured lines of credit, can help businesses – up to a few million dollars for large corporations and up to a few thousand dollars for small businesses.

Most businesses prefer an unsecured business line of credit, since the conditions aren’t as stringent as those with secured business lines of credit. The owner of the enterprise must show to the bank some collateral, guarantees, or proof of personal possessions before they are granted use of the money through a secured line of credit. Extending a line of credit on an unsecured business loan is only likely to be approved according to the credit profile of the business and their ability to repay.

Lending institutions tend to grant more secured versus unsecured business lines of credit for the simple reason that the secured option allows them to disregard minutiae, such as how long the enterprise has been operational, a less-than-stellar business credit history, or uncertainty with set areas disturbing the business. These factors could scare off the lenders who think of such an enterprise as a higher risk in terms of pay back capabilities or meeting the terms of the business line of credit, and so they may be wary about funding an unsecured line of credit.

If you want to learn more about Business Credit & Building Corporate Credit, please visit the website.

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If you have heard the term peer to peer lending or social lending or have never heard it before, the process is growing in popularity day by day. It definition is implicit in the name peer to peer lending and it is the process of individuals lending money to each other.

It is rooted with the idea that a bank should not play a large role and reap the majority of returns. In the model of social lending, the bank or financial institution facilitates the loans and get a small rate of return for doing so. In essence it is cutting down the middle man. To get the true underlying rationale, we need to examine the basic model of receiving a loan from a bank.

It begins with individuals using banks as a method of saving their money. The banks pay a low rate of return for the deposits as for the banks right to use the money for lending. On other side are individuals applying for a loan or mortgage. The bank takes the deposits it has and lends to the borrower at a much higher rate of interest. The difference in interest paid and interest earned is the bank’s revenue. In this model all of the risk is assumed by the bank. Meaning, the obligation of paying interest to the saver and preventing default of lent money is the risk.

With peer to peer lending the model is shifted. The bank or institution pays a much smaller role. An individual lender can choose what to lend and who to lend too and therefore majority of the profit from the loan is transfer directly to the lender. With this trade off of less bank involvement there is an increase in risk to the individual lender in the form of default. For the borrower, the benefit is more often than not a lower cost of transaction translating itself into a lower rate of interest on the loan.

How peer to peer lending is actually facilitated is an auction process with a basic market place provided by the lending institution. Which means the institution that processes the loans between individuals is the one that provides the method for individuals to find each other. Then the borrowers and lenders are able to select each other. Now, the lending to a person you have never met before does has its risk, but the presence and responsibility of the financial intermediary is to ensure individuals are accurately represented.

This is a concept would have never been considered until a few years ago. The internet actually is the stage that allows this to happen. The increase sociability of individuals caused by use of the internet provides this unique way to invest and borrow money never before possible.

To learn more about peer to peer lending or social lending, visit Kyle’s website. There is a more complete review of the topic.