November 9th, 2009
Monday Jumpstart to Credit Report & Personal Finance News
Saving money is a tricky business in our economic climate– credit is still tight, debts are high, and paychecks go straight to bills and necessary expenses with not much left over for a rainy day fund. This extra-big roundup has more than 50 ways to help you cut back on spending so you can start saving up more. Isnt’ it about time to start saving money for yourself and your future, now?
Personal Finance News
- Daily Finance makes a good point: Its the end of the recession as we know it. Why don’t we feel fine?
- Money Ning sets you straight with 3 easy steps to determine your financial priorities.
- How disposable is your money? asks Almost Frugal.
- Best way to invest $1,000 right now writes MSN Money.
- Want even more tips on investing? Read The Digerati Life blog, Where to invest extra cash and savings today.
- Gather Little By Little suggests 10 small ways to save money that make a big difference.
- 10 tricks for staying warm this winder without huge energy bills straight from The Simple Dollar.
- If you want to cut back on auto insurance, follow Saving to Invest’s 5 things to look for in getting low-cost auto insurance rates.
- Paying too much at the pump? SmartMoney suggests 5 ways to cut down on gas costs.
- 3 ways to save money on health insurance from CNNMoney.
- If you just can’t help it for the holidays, SmartMoney shows you how to splurge on a budget.
- Smart year-end tax moves to read before the new year! From Wall Street Journal.
Credit Reports & Credit Scores News
- Tips from Liz Weston on how teenagers can build credit.
- Consumer credit falls for 8th month reports CNNmoney.com.
- Your credit score can affect how to get the best deal on a new car; read ahead at SmartMoney.
- Ever wondered why aren’t credit scores free? Walletpop has the answer.
- NBC Bay Area makes credit health as easy as 1, 2, 3, 4.
July 24th, 2009
Prosper Returns To Upgrade The Peer-to-Peer Lending Space
P2P lending marketplace Prosper began lending again on July 13 with the green light from the Security and Exchange Commission.
Originally launched in February 2006, Prosper was the first auction platform, matching prospective lenders and borrowers by allowing the final rate to be established essentially by what lenders will pay. In October 2008, the SEC halted Prospers operations because federal law prohibits the sale or offer of securities without the company registering with the regulators.
Prosper came back a healthier, more lender-friendly marketplace with key enhancements for borrowers and lenders alike including:
- Lender: A minimum credit score for borrowers from 520 to 640 and capped the loan request to $25,000 for a three year fixed rate loan.
- Lender: Added onto the already existing borrower profile information, which details past loan performance as well as credit files, is a Prosper Rating that ranges from AA- HR and represents a loss rate range. The Prosper Rating will be shown in the listing along with an estimated loss rate and credit score range (20 points, down from 40 points).
- Lender and Borrower: Lowered minimum bid requirement from $50 to $25. This helps lenders to diversify their loan portfolio.
- Lender: Better lending with a “hard bid floor” for each loan listing that sets the minimum interest rate a lender can bid; this helps lenders assess the risk of the loan and price it more appropriately.
- Lender: Now lenders can sell their Prosper Loans in a new secondary market, Foliofn. This gives lenders more liquidity with their Notes if they need access to the funds before the loan is fully paid off.
Currently, Prosper can facilitate P2P lending in 16 states including California, Illinios, and New York, and is working through each state’s regulatory process to allow lending nationwide.
Prosper is the first Internet auction-based lender approved by the SEC. Unlike competitor P2P lender Lending Club, where fixed interest rates are set according to Lending Club’s base rate plus Adjustment for Risk and Volatility, investors at Prosper agree to fund a borrower without knowing what the final interest rate will be. Other major player Loanio imitates Prosper’s auction platform and unsecured rates, but has currently suspended its business pending registration with the SEC.
Despite the 9 month setback, Prosper seems to be on its way back to the top ranking in P2P websites. Prosper has more than 840,000 members and funded an estimated $178 million in personal loans. Their comeback arrives not a second too soon, providing consumers an alternative to big banks and reviving hope that consumers can still put their money to work despite the current dry spell in the credit markets. Looks like alternatives to investing, without the bank or broker middleman, can be, well, prosperous.
