Peer Lending – A New Passive Income Stream To Explore
8 March, 2009 (21:49) | Passive Income, Peer Lending | By: 
Dusty
If you are new here, please consider SUBSCRIBING to my feed.
I look forward to reading PassiveFamilyIncome’s peer-to-peer lending reviews each month. Peer lending is one stream of income that always interested me, even though I never seemed able to pull the trigger. I cannot stand what is going on in the credit card world right now.
How is it fair that the credit card companies can change your interest rate even when you have never been late? How is it legal that they are able to charge someone 25% interest? How is it ethical to hit a borrower with over-the-limit fees when the stupid interest is what put them over the limit?
All of these things have bothered me for years. Today I have decided to do something about it.
I first read about peer lending on PFI. I think that John mostly used Prosper and Lending Club for his lending. Since Prosper is currently not accepting new lenders, I joined Lending Club. The cool thing about this is that since I joined under someone else’s link, Lending Club gave me $50 to start my lending career off right! Not a bad return on investment.
It took about 5 minutes to complete the paperwork and I was off and running.
Now comes the hard part. I have to decide who to lend my money to. Since this blog focuses primarily on debt reduction and passive income, I have decided to make this my lending criteria:
- Credit Score Over 700
- Using Loan to Reduce Debt
- Zero Delinquencies in Past 2 Years
What do you think? What is your lending criteria? If you are considering trying peer lending, please consider using the following link – LENDING CLUB. It will give you $50 (FREE) and me another $25 (I think).
Popularity: 41% [?]
| 3.2 |
Comments
Comment from Corporate Barbarian
Time: March 9, 2009, 1:30 pm
I’ve wanted to give peer lending a try, but haven’t yet. But your post has nudged me to at least do more reading on the subject. Thanks.
|
|
2.2 |
Comment from J. Money
Time: March 9, 2009, 7:12 pm
hmm..yeah never tried myself yet, but in theory it sounds awesome. i think i’d choose the same sort of lending criteria as you.
|
|
3.2 |
Pingback from PFI Weekly Updates – March 10 (2009) — Passive Family Income
Time: March 10, 2009, 7:14 am
[...] – Dusty from Chasing The Bull decides to start peer lending by opening an account with Lending [...]
Comment from lulugal
Time: March 10, 2009, 10:09 am
I use the same criteria that you use and so far I have had good results. I have one loan that is in default but it is only for $25 so I am not making a big deal of it. I only lend $25 on each loan so if someone does decide not to pay then the hit to me is small.
|
|
3.2 |
Comment from pfincome
Time: March 14, 2009, 11:24 pm
What I like about Lending Club compared to Prosper is that you can bid $25 @ LC as opposed to $50 at Prosper. The $25 allows for more diversification.
|
|
3.2 |
Comment from Rick Vaughn
Time: March 21, 2009, 1:26 pm
Dusty, your lending requirements are spot on. I certainly will never be an apologist for the credit card industry but people still use them all the same. This is a good idea for some passive income I will need to look into this. Thank you!
|
|
3.2 |
Pingback from Peer to peer lending | Passive Income
Time: June 26, 2009, 8:05 am
[...] get receive $50. As such, I immediately set out to lend this money to someone who really needed it. My lending strategy, can be boiled down as [...]
Comment from pfincome
Time: March 8, 2009, 10:21 pm
Dusty – Thank you for the link. As with any kind of investing, I think it is important to have a plan and it looks like you are on your way. I know with my Prosper lending, it can be very tempting to bid on loans above 20%. Unfortunately most of those loans don’t seem to work out very well. Looks like you have a very nice plan setup and I hope to read your monthly updates really soon!