Sunday, January 20, 2008


i've been sitting on the sidelines on this whole prosper thing for a while now and i'm finally going to jump in and see what the hoopla is about. the story behind prosper, if you don't know, is that it's a web site that allows people to lend or borrow money from other people and they handle the collections, credit scoring, and the whole infrastructure behind setting up and servicing loans. all you have to do is put your money in, set your terms, and approve or deny loans.

i don't know what kind of return that you really could expect -- especially after calculating for losses from defaults, but i do understand that prosper would be able to cut the fat from some of this process and, as such, be able to offer lower rates, which would be interesting to me from a borrower's standpoint.

the problem is, as i see it, that in order to make money, you'd want to service loans on the lower end of the credit spectrum and that would likely open you up to higher risk. if you can balance that and set rates accordingly, it may be a decent place to park some cash.

Business & Personal Loans. Great Rates. Prosper.

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