The internet just blows me away with new ideas everyday. Before this, it was UShip.com, a shipping/moving bidding site that lets users bid for or list their moving services (from cargo shipping, moving vans, etc).

Now it’s, Prosper.com… a bidding site for.. guess what? LOANS! If you are looking for a great lending rate or you want to invest your money for a better return than the banks, you should check out this website.

Users can lend their money to people they think credible or request for loans at the rate they want. It’s a collective loan e.g. if I were to request for a loan amounting to $5,000…. I may be borrowing from 20 people who are willing to lend me $250. This reduces the risk of the lenders and give the borrowers a discount on the loan rate.

So what if the borrower defaults on payment? Loans that are written off as uncollectable are offered for sale at an auction to a selected group of debt collection companies that are in the business of purchasing defaulted loans. Don’t expect to get back your full amount though because the debt’s will be fairly old when sold to debt buyers.

This is a great concept to offer individuals and small businesses easier access to capital, and small individual investors an opportunity to earn a return on surplus cash. Visit Prosper.com to learn more about it.

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