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A second way to use the Internet for your banking is through what's called peer-to-peer lending. This is where you borrow money directly from a person or group of people to consolidate debts, buy a car or for any other worthwhile cause and where there is no third party such as a bank involved. There are a number of these lenders available online. Two of the most popular are Lending Club and Prosper. Both of these offer unsecured loans at a variety of interest rates that range from 6% to 29.99%, depending on your credit score and situation. One of these loans can be a good way to pay off credit card debt because you should be able to get a much better interest rate than what you're currently paying on those debts.
If you think you might like a peer-to-peer loan, here are some tips that might be helpful.
- Think like a lender – the more you can convince the potential lender that you’re a good risk the better
- Tell the truth
- Describe your situation as much as possible
- Be sure to check your grammar and punctuation
- Have realistic expectations
- Don’t act desperate
- Respect the contract
Here’s a short video explaining more about peer-to-peer lending and how it helped one Army vet.