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ScamXposer Review: Prosper High Yield Loans
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Overall Rating: |
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Type of Business: |
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High yield loans & borrowing program |
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Skill Level Needed: |
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Beginner |
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Income Potential: |
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9.49% - 12.81%+ net annual return on investment |
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Recommended: |
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Yes |
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Weblink / URL: |
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http://www.scamxposer.com/prosper.html
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What Prosper.com has to say about themselves -
Prosper, America's first people-to-people lending marketplace, was created to make consumer lending more financially and socially rewarding for everyone.
The way Prosper works is intuitive to people who have used eBay. Instead of listing and bidding on items, people list and bid on loans using Prosper's online auction platform.
People who want to lend set the minimum interest rate they are willing to earn and bid in increments of $50 to $25,000 on loan listings they select. People who lend can easily diversify using "standing orders", which automatically make many small loans to different borrowers.
Borrowers create loan listings for up to $25,000 and set the maximum rate they are willing to pay a lender. Then the auction begins as people who lend bid down the interest rate. Once the auction ends, Prosper takes the bids with the lowest rates and combines them into one simple loan. Prosper handles all on-going loan administration tasks including loan repayment and collections on behalf of the matched borrower & lenders.
Prosper's rigid privacy policy reflects co-founder and Chief Executive Officer Chris Larsen's longstanding history as an advocate of stringent consumer financial privacy protection laws and practices. Prosper does not sell, rent, or share members' personal information with third party marketers.
Prosper members are in control of how much personal information—if any—is revealed on the website and with other members. Prosper's security and identity verification systems are state of the art, and consistent with those used by banks, brokerages and institutional creditors.
Prosper generates revenue by collecting a one-time 1% or 2% fee on funded loans from borrowers, and assessing a 0.5% or 1% per annum loan servicing fee to lenders. Backed by Accel Partners, Benchmark Capital, DAG Ventures, Fidelity Ventures, Meritech Capital Partners, and Omidyar Network, Prosper has raised $40 million. Prosper's marketplace platform is patent pending.
Lend money to other people and earn interest
Lending money directly to people is a great way to earn a fair return. Prosper provides a lot of credit, employment, and income data, and lets you choose exactly who you want to lend to.
Isn't this risky? What if a borrower defaults?
When you make lots of small loans rather than one or two big ones, you spread your risk out and ensure a more reliable return. It's called diversification and the pros do it every day.
Although we refer to you and other individuals as "lenders", the loans are being made by Prosper and then sold to you, making you a loan purchaser. The term "lender" is used through prosper.com for the sake of simplicity.
SX Review - Finally... a real high yield investment program. Earn 6-29% annual returns on your money. Prosper has over 470,000 members with $100,000,000 in loans to date. There are a lot of claims on the Internet when it comes to make huge returns on your money, but this is the only legitimate investment opportunity I have come across so far.
Update 12/01/2007:
I have heard some chatter lately about concerns over the number of defaults rising so if you are planning on lending money on Prosper.com, be sure to only lend money to those that have good to excellent credit. This obviously means that you won't be getting 20%+ returns on the loans, but at least you won't have to worry about losing your money either. Follow their guidelines about only lending small amounts over numerous loans as opposed to large amounts to a single borrower.
Update 12/20/2007: 530,000 members, $107 Million in loans. - Earn 9.49 - 12.81% returns - Prosper.com get's a 1/2 star back for creating their new "Create Your Portfolio Plans" program that explains in much better detail the risks involved with investing in lending money to your peers as well as automating the whole lending / borrowing process.
The 4 new plans are...
"Conservative" - Very low risk with an average return of 8.55%.
"Balanced" - Low risk with an average return of 9.20%
"Moderate" - Medium risk with an average return of 10.40%
"Aggressive" - High risk with an average return of 11.56%
These figures now account for average losses that are incurred by default loans.
These are the realistic numbers one can expect to receive based on the chosen plan..
FYI... You'd be very hard pressed to find higher rates than these with any other legitimate company on the Internet. If you do come across something that is NOT an HYIP program that offers higher rates than these, please write to me letting me know about the new company. - Thanks
Verdict - Not Guilty!
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