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Does anyone use a peer to peer loaning app?

If so, which one do you use and what has been your experience with it?

26 thoughts on “Does anyone use a peer to peer loaning app?

  1. If you’re referring to things similar to Funding Cirle, RateSetter, etc, which are all UK P2P lending services which promise “up to 6% interest”, then I can’t stress enough to avoid them! The advertised rate is far more than your actual return and you’re more likely to lose money – there has been significant proof of this. The amount of bad debt that you’ll be stuck with by people not repaying it leads to a significant loss.

    1. I heard that some of these have money back guarantees where if people default you don’t lose your money. Is this not true for most of them?

      1. To some extent, yes but also no. The only company I’ve heard of doing that is here in the UK is RateSetter with their provision fund. While in theory, no one loses money, that doesn’t really work in practice. Back in 2017 RS had a few massive loans go bad with some advertising company and something else I think and they had to step in. They ended the year with £5-£10 million in losses. The figures aren’t exact and a bunch of people will quote different numbers which is there’s a range. By 2018 they were operating at a loss of £20-£25 million. Still want to dump your money in there?

        Any way you look at it, they aren’t FSCS protected (don’t think Americans have anything similar anyway) and the majority of the loans being given are unsecured. Bare in mind that a lot of these loans aren’t your casual £100 here and there, the way they work is they collect hundreds of thousands, if not millions from thousands of people, collect it all up and lend it out to individual businesses. Just one bad loan and these companies who promise zero losses are going to have to pay out massive amounts of money.

        It’s not a very sustainable business model and eventually they will fall. RateSetter was founded in 2010, out of those 8 full years of business, how many of those were they making a loss and how many did they actually turn a profit? I know it’s not P2P lending but Wonga, a payday lender here in the UK got roasted by some phat loans lol. Long story short, they went into administration even after they received a £10 million boost to try and combat the amount of compensation claims they were receiving. All these companies who offer loans to anyone who wants one will eventually go bust and in the case of P2P, it’s normal people like you and me who lose out instead of the corporate lot. Therefore in my opinion it’s best to steer clear, even if they do offer their own security.

  2. Most of these peer to peer services cater to people that are already up to their eyeballs in debt and can’t get a loan at a regular bank. When someone stops paying on their loan, you can kiss that money goodbye.

  3. I lent out about 20k on So far after defaults and written off loans my return is around 2.23% Would not use again.

  4. I use a few with great results. The trick is to find a p2p lending platform that treats lenders as employers instead of customers.

    Most of the p2p platforms let people default and wont take action. The good ones will hunt down the loaner to force them to pay up with letters, mails, visits to the door and more throught debt collection agencies.

    I prefer lending in western countries for this reason because its easier to hunt down defaulters and make them pay up.

    When people get “charged off” (aka they default and wont respond to debt collectors” their information should become public and visible in Google. That usually is enough for people to pay up because their name will be tainted for the rest of their life. If not I usually find a “no cure no pay” debt collector since they tend to be more aggressive in collecting.

    There are tons of more things your p2p lending platform should be doing for you.

    I find that most platforms are only interested in taking a fee, and they treat the lenders as customers, which is not okay in my opinion.

    1. Tried prosper as a borrower. I had a great job at the time, but I had “divorce credit” and was saddled with his debts to boot. I wanted a loan to consolidate & pay then off, plus give me a little breathing room. They said my credit was too low for them to help me. I was in the 625-650 range. Which isn’t great, but, if I had better credit I wouldn’t have to go to prosper.

        1. Mine was the opposite. And in CA, it’s a community property state. His bills became mine. He even forged my signature to get a $10K Visa card, had the bills mailed to his work office on the military base he worked on. So, I my credit report it reads a long military acronym for a “former place of residence”. I have to argue with the credit bureaus all the time & tell them, “There is NO HOUSE THERE. It is an operations deck for a Navy Flight Line!”

    2. I’ve used LendingClub twice as a borrower. I think it’s a really neat idea, and I’ve always paid back my loans ahead of time by making extra payments on top of the automatic ones. First loan was for 11k, 2nd, years later, was for 7k. The last one I got with credit score below 650.

    3. I used lending club to consolidate and haven’t had any issues. It was super easy and I’ll have my debts paid off in 3 years instead of what seemed to be 39583934 years.

      1. Well it’s not an app but i’m using Mintos and it’s been great so far if you know how to use it. I make 10.xx% net annual return with buyback guarantee and an Auto-Invester.

        Hmu if you need more info.

  5. I’m using LendingClub and my current net adjusted rate is 9.25%. That’s adjusted for past due notes (one is close to default). So since January I’ve made about $67 in returns on my initial $2,500 investment. I have it on auto mode split 34/33/33% between A/B/C-class loans which is pretty conservative, and for 36-month only terms because I want to be as liquid as possible when the next recession hits. It says the average returns for my strategy are 5.5% so I guess I’m lucky?

  6. Every internet loan site asks for as much personal info as you are willing to give them. Then, you are told you are just an eensy weensy bit away from getting your loan but would you please enter your info one more time on one more website. Rinse and repeat.

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