Comments on: Prosper: the Leader in Social Lending http://moneysmartlife.com/prosper-the-leader-in-social-lending/ Money Tips for a Better Life Sat, 21 Nov 2009 13:21:41 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: » Roundup: I Will Never Shop At Bailey Banks & Biddle on Blueprint for Financial Prosperity http://moneysmartlife.com/prosper-the-leader-in-social-lending/comment-page-1/#comment-95632 » Roundup: I Will Never Shop At Bailey Banks & Biddle on Blueprint for Financial Prosperity Sat, 09 Aug 2008 12:50:29 +0000 http://moneysmartlife.com/prosper-the-leader-in-social-lending/#comment-95632 [...] Ben takes a look at Prosper. [...] [...] Ben takes a look at Prosper. [...]

]]> By: Early Retirement Extreme http://moneysmartlife.com/prosper-the-leader-in-social-lending/comment-page-1/#comment-56394 Early Retirement Extreme Fri, 01 Feb 2008 18:33:14 +0000 http://moneysmartlife.com/prosper-the-leader-in-social-lending/#comment-56394 I'm pulling out of prosper (was in with $10k at one time). While it does not seem to be worse than other junk debt, loans have no liquidity. Also the fact that some borrowers are intentionally screwing lenders over just annoys me too much on a personal level. I’m pulling out of prosper (was in with $10k at one time). While it does not seem to be worse than other junk debt, loans have no liquidity. Also the fact that some borrowers are intentionally screwing lenders over just annoys me too much on a personal level.

]]> By: Adfecto http://moneysmartlife.com/prosper-the-leader-in-social-lending/comment-page-1/#comment-45683 Adfecto Mon, 14 Jan 2008 16:32:37 +0000 http://moneysmartlife.com/prosper-the-leader-in-social-lending/#comment-45683 I have looked into Prosper as a potential investment and found that right now, it does not fit with my goal. It is a simple goal: MAKE MONEY. The default rate is too high. The only way to smooth out the volatility is to diversify over a huge number of loans. A rough rule of thumb (actually taken from the poker world) is that you should have 200x the big blind in order to ride out the bad beats. In other words, you need to invest $50 * 200 = $10k. Next you need to find 200 loans that meet your threshold for credit grade, debt to income ratio, and "social purpose." I've never been able to find more than 10 loans at any given time that meet my criteria. A return is only made on money that is invested in loans (as Bob said) and sizable fees are taken by Prosper so there are significant losses in real return due to prepayment and overhead. In short, put your money somewhere else. If you want to "help people" give to a worthy charity. If you want to make money buy stock and bond index funds. I have no problem with this blog doing a write up on Prosper. More power to you Ben for creating your own income stream. Cheapster_Bob, if the content of a post does not interest you I would recommend skipping it rather than feeling the need to knock down someone who is trying to make an extra income for himself. Not every article is intended for every single reader. Check back tomorrow and I'm sure Ben will have a new post about something that does interest you, until then take a chill pill man. I have looked into Prosper as a potential investment and found that right now, it does not fit with my goal. It is a simple goal: MAKE MONEY. The default rate is too high. The only way to smooth out the volatility is to diversify over a huge number of loans. A rough rule of thumb (actually taken from the poker world) is that you should have 200x the big blind in order to ride out the bad beats. In other words, you need to invest $50 * 200 = $10k. Next you need to find 200 loans that meet your threshold for credit grade, debt to income ratio, and “social purpose.” I’ve never been able to find more than 10 loans at any given time that meet my criteria. A return is only made on money that is invested in loans (as Bob said) and sizable fees are taken by Prosper so there are significant losses in real return due to prepayment and overhead. In short, put your money somewhere else. If you want to “help people” give to a worthy charity. If you want to make money buy stock and bond index funds.

I have no problem with this blog doing a write up on Prosper. More power to you Ben for creating your own income stream. Cheapster_Bob, if the content of a post does not interest you I would recommend skipping it rather than feeling the need to knock down someone who is trying to make an extra income for himself. Not every article is intended for every single reader. Check back tomorrow and I’m sure Ben will have a new post about something that does interest you, until then take a chill pill man.

]]> By: Cathe Rine http://moneysmartlife.com/prosper-the-leader-in-social-lending/comment-page-1/#comment-45629 Cathe Rine Mon, 14 Jan 2008 09:07:36 +0000 http://moneysmartlife.com/prosper-the-leader-in-social-lending/#comment-45629 Everyone in this world dreams of having a house of his own. A house with all comforts and luxury also reflects one’s status in the society. Many of us never fulfill such dreams just because we lack in sufficient finance but with the advent of home improvement loans without any security the task has become very simple and affordable. These loans are available without keeping any collateral; hence any one with or without any asset can go for it. These loans are especially designed for tenants who either don’t have any asset to keep as collateral or don’t want to risk them. You can borrow such loans for home expansion, renovation, refurnishing, remodelling etc. Everyone in this world dreams of having a house of his own. A house with all comforts and luxury also reflects one’s status in the society. Many of us never fulfill such dreams just because we lack in sufficient finance but with the advent of home improvement loans without any security the task has become very simple and affordable. These loans are available without keeping any collateral; hence any one with or without any asset can go for it. These loans are especially designed for tenants who either don’t have any asset to keep as collateral or don’t want to risk them. You can borrow such loans for home expansion, renovation, refurnishing, remodelling etc.

]]> By: Jeremie B http://moneysmartlife.com/prosper-the-leader-in-social-lending/comment-page-1/#comment-45600 Jeremie B Mon, 14 Jan 2008 03:54:29 +0000 http://moneysmartlife.com/prosper-the-leader-in-social-lending/#comment-45600 Cheapster Bob, I think you kinda judged a little too quickly. Out of Ben's hundreds of articles, one or two articles about a company that gives him money when he refers people, shouldn't be hated upon. Ben has a life, wife and kids and deserves a kick back on a blog that he dedicates a lot of time on. Prosper is a fine company and does have a great business model. It's like an online venture capitalist firm. What is the harm of a little self-promotion for a company that will pay Ben for referrals? Bloggers can't just rely on the mostly "crappy" ads provided by 3rd party ad companies anymore. Time is money and Ben should be compensated for his hard work. I am actually tired of reading the redundant crap about trying to save pennies on every other personal finance blog. I would rather promote a company that offers me $25 per referral instead of reading about how you can save a few cents on gasoline. Keep on working hard Ben and I hope you can make some good money off of Prosper. Cheapster Bob,

I think you kinda judged a little too quickly. Out of Ben’s hundreds of articles, one or two articles about a company that gives him money when he refers people, shouldn’t be hated upon. Ben has a life, wife and kids and deserves a kick back on a blog that he dedicates a lot of time on.

Prosper is a fine company and does have a great business model. It’s like an online venture capitalist firm. What is the harm of a little self-promotion for a company that will pay Ben for referrals?

Bloggers can’t just rely on the mostly “crappy” ads provided by 3rd party ad companies anymore. Time is money and Ben should be compensated for his hard work. I am actually tired of reading the redundant crap about trying to save pennies on every other personal finance blog.

I would rather promote a company that offers me $25 per referral instead of reading about how you can save a few cents on gasoline. Keep on working hard Ben and I hope you can make some good money off of Prosper.

]]> By: Ben http://moneysmartlife.com/prosper-the-leader-in-social-lending/comment-page-1/#comment-45455 Ben Sun, 13 Jan 2008 07:10:07 +0000 http://moneysmartlife.com/prosper-the-leader-in-social-lending/#comment-45455 Cheapster Bob, nice name. I consider myself a cheapskate as well. This week we chose to take a look at peer to peer lending since it is an empowering and enabling new opportunity for some lenders and borrowers. I think it's a fascinating model and has a lot to offer for some people. We took a high level look at peer to peer lending in general, borrowing/lending on Prosper, and Kiva.org You're right; I haven't given the industry full coverage. There are other options opening up from other companies that I'll be sure to mention in the future. You're also right that lending on Prosper can have high risks and that it's not for everyone. These posts weren't intended to be in depth analysis of the risks and rewards of lending/borrowing on Prosper, they're an introductory overview. Once I have more personal experience with peer to peer lending I can address the risks and rewards and what works for me. Have you read my post on <a href="http://moneysmartlife.com/extreme-investing-for-the-adventurous-in-all-of-us" rel="nofollow" rel="nofollow">Extreme Investing</a>? Perhaps investing in Prosper could be someone's extreme investment option. I do have a Proper referral ad in my nav but if you notice, none of the posts from this week have any kind of affiliate link in them. However, now that you mention it, I might think about adding my referral links into the posts. I'd be paid $25 for anyone that signs up with Prosper through my link and borrows or lends money through them. As would the person that signs up and lends or borrows. I'd be fine with that, I think Prosper offers a valuable service and wouldn't hesitate to recommend someone to try them out. Thanks for the suggestions, it's always nice to know what people are thinking when they read the posts. Cheapster Bob, nice name. I consider myself a cheapskate as well. This week we chose to take a look at peer to peer lending since it is an empowering and enabling new opportunity for some lenders and borrowers. I think it’s a fascinating model and has a lot to offer for some people. We took a high level look at peer to peer lending in general, borrowing/lending on Prosper, and Kiva.org

You’re right; I haven’t given the industry full coverage. There are other options opening up from other companies that I’ll be sure to mention in the future. You’re also right that lending on Prosper can have high risks and that it’s not for everyone. These posts weren’t intended to be in depth analysis of the risks and rewards of lending/borrowing on Prosper, they’re an introductory overview. Once I have more personal experience with peer to peer lending I can address the risks and rewards and what works for me.

Have you read my post on Extreme Investing? Perhaps investing in Prosper could be someone’s extreme investment option.

I do have a Proper referral ad in my nav but if you notice, none of the posts from this week have any kind of affiliate link in them. However, now that you mention it, I might think about adding my referral links into the posts. I’d be paid $25 for anyone that signs up with Prosper through my link and borrows or lends money through them. As would the person that signs up and lends or borrows. I’d be fine with that, I think Prosper offers a valuable service and wouldn’t hesitate to recommend someone to try them out.

Thanks for the suggestions, it’s always nice to know what people are thinking when they read the posts.

]]> By: Lulugal11 http://moneysmartlife.com/prosper-the-leader-in-social-lending/comment-page-1/#comment-45381 Lulugal11 Sat, 12 Jan 2008 16:36:21 +0000 http://moneysmartlife.com/prosper-the-leader-in-social-lending/#comment-45381 I originally joined Prosper to get a loan to pay off credit cards.....and then I decided to become a lender too. I have invested $100 in two separate loans and hope to see the payments coming in the next two weeks. I originally joined Prosper to get a loan to pay off credit cards…..and then I decided to become a lender too. I have invested $100 in two separate loans and hope to see the payments coming in the next two weeks.

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