Sunday, December 30, 2007

P2P Lending Review: Best of 2007

The P2P lending market has changed significantly in 2007. One year ago the only P2P lending story was Prosper. Time named Prosper the top website of 2006. BusinessWeek predicted that Prosper would be one of the Top Eight Tech Companies to Watch in 2007. A year later, Prosper continues to make headlines but several other p2p lending companies are making news as well. Here are a few highlights from 2007:


Prosper



Lending Club





Zopa







  • Expands from the U.K. to the U.S.
  • They announce a very new P2P lending model comparable to a certificate of deposit at a bank or a termshare certificate at a credit union. You also have the option to reduce the rate to help out borrowers. The loans are federally insured and currently earn 5.1%.

Circle Lending/Virgin Money






GlobeFunder







  • Announces they will launch on October 2nd but then delays for "lending licenses and website development"
  • This week they just launched a new webpage and appear to be open for institutional lenders and will allow borrowers to sign-up, but individual lenders must wait

Loanio





In June we started Prosper Lending Review. It's been fun and we have learned a lot. According to visitors, these are our most popular articles in 2007.

15 Most Popular Articles of 2007

A Prosper scam: The story of Jessica Wolcott
Prosper: A hands-on education in risk management
How does Prosper compare to other investments?
Prosper Lending Review - the first month
When to bid on Prosper loans
Review: Top Prosper Blogs
What is Loanio?
Borrowing money to lend on Prosper: Wise or Foolish?
Credit Scores on Prosper - Part 1 of 2
Why would a borrower use Prosper instead of a traditional bank?
Equity sharing - Prosper for real estate

Loanio prepares for fall launch
Prosper Lending 101 - webinar review
Prosper CEO: Lenders avoid subprime and 'flight to safety'
Lending Club announces $5000 video contest

The most popular articles are not always the most useful articles. While A Prosper scam: The story of Jessica Wolcott may be interesting reading, it is not going to provide solid actionable investment advice like some of the following articles. If you are about to commit your hard earned money to p2p investments it makes sense to do as much research as you can. Of the 100+ post of the last year I recommend that following ten as required reading for all investors (I'll also note they they were all written by the other co-author of this blog, Matt):

10 Best PLR articles of 2007

How does Prosper compare to other investments?
Prosper: A hands-on education in risk management
Why would a borrower use Prosper instead of a bank?
Borrowing money to lend on Prosper: Wise or Foolish?
Most Prosper lenders do not diversify
Are all Prosper loans within a credit grade created equal?
An analysis of pre-payment risk on Prosper loans
Are non-homeowners a safer lending risk in a declining house market?
Credit Scores on Prosper - Part 1 of 2
When to bid on Prosper loans

We look forward to 2008 and the many changes it will bring to the p2p lending marketplace. Happy New Year!

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