Something I have added as a small portion of my personal investment portfolio is a P2P (peer to peer lending) portfolio. What is P2P? P2P is an alternative credit source. What you do is browse the prospective borrowers on the P2P site and decide to fund a portion of their loan. Often times the minimum amount to "bid" on the loan is $25, or you allow the P2P platform create you a portfolio according to your guidelines.
I personally use prosper.com. I started by investing $50, $25 went to two individual loans. My current note yield is around 19%. Now, to be fair I expect my returns to sink downwards as my portfolio grows. I am very pleased with the results that I have gotten using prosper. My to debtors have been on time in their payments every month so far, and I am in the process of funding another loan. To be fair though you should be prepared for some losses, Prosper projects losses for you and claim that the average investor is still receiving 10% returns. Also if you are looking at this as an investment for yourself it will be important to keep in mind that losses will occur. Banks have credit reserves in case you don't pay your mortgage or credit card, and the bank is actually required to do this due to accepted accounting principles. You should also predict some sort of potential losses and have a "reserve" estimate so that you aren't disappointed when one of your borrowers default.
If you have any specific questions about Peer to Peer Lending I would be happy to answer them.
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