I’m old enough now to learn that I should never say never about anything. There was a time that I was very anti peer-to-peer lending and thought there were no longer any opportunities for people to get unsecured debt consolidation loans.
My initial uncertainty and hesitancy about this form of lending was supported by what I observed in the early days of P2P lending where people lent money in pools to borrowers in need. The early days with other companies seemed to show that there was little management of lender risk and the default rate among borrowers was high.
But with a bit of time and experience at least one company, LendingClub, seems to have created a system that provides lender protection. Now don’t be fooled, when you borrow from LendingClub they are very strict about payments. Miss a payment or late with a payment, collectors will call and as a lender, I enjoy the fact they are working hard to protect my investment.
But by being strict about repayment LendingClub creates an environment that creates more comfort for people just like me that want to invest as little as $25 to help someone in need.
LendingClub openly publishes their statistics about loan status and borrower payments through the Latest Performance Statistics section of their site.