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Peer loans are loans taken by name from other individuals and not from financial corporations . However, no ordinary guy is not involved in peer-to-peer lending, but the loan is sought from a peer-lending company. Peer lenders remain unknown to each other, and the applicant does not need to know anyone who could be asked for a loan. It is enough to leave the loan application on the pages of the peer loan service.
Peer-to-peer loans are sought online in the same way as ordinary consumer credit. At first, you need to decide how much loan you want and what kind of payment period. Often, peer-to-peer loans do not give the smallest quickcuts, but the smallest loan is 500 euros . So it is more of a substitute for consumer credit than for quick cops.
Once you have completed your payment period, you can also influence other things. In most peer-to-peer services, you can choose the interest rate you borrowed . This means the maximum interest rate, ie you can indicate that you do not pay more than a certain amount of interest. Some services also include a small application that tells about their own loan needs and tries to convince investors of the credibility of the applicant.
Applications are available to investors on the peer-to-peer web site and investors decide for themselves who to invest in. Typically, a peer-to-peer loan is made up of investments from a number of different investors and therefore does not come from just one person. This reduces the risk for investors and improves the borrower’s access to the loan .
Peer-to-peer lending is not a bomb-proof way to get a loan , it may be that no investors can be found. If you set your maximum interest rate really low, no one will necessarily want to borrow. If the interest rate goes high again, the borrower may not want to borrow himself, even if there are investors. However, there is often a suitable compromise, and peer loan services have become quite popular in Finland. Peer loan services include Fixura and Fellow Finance .
Why then apply for a peer loan or a normal consumer credit? One of the much-favored advantages of a peer-to-peer loan is that the loan can be obtained at a lower price than traditional finance companies. However, the price of the loan depends a lot on how good the applicant is for the credit rating.
Some may be borrowed through peer-to-peer lending even though the loan company has not granted it a loan . However, a payment disruption entry also prevents the loan from being received in the case of a peer loan. For some, the reason is simply that we want to try something new and different. In peer-to-peer lending, interest income from the loan goes to other Finns, not to large loan companies.