Pros and Cons of Social Lending
By JRP in Finance | 4 comments
Social lending is an increasingly popular option that people are using to pay off their credit card debts. This is basically a personal loan that you get from a private individual. It is kind of like a cash advance which you can use to pay off your credit cards and then you re-pay the lender based on the terms agreed upon. It is set up through social lending sites which link borrowers and lenders through a social networking platform. The idea is that you may be able to get a better loan while making you more accountable to pay it off because of the social pressures inherent in the peer-to-peer lending program.
There are definitely great things about social lending. Your loan is likely to have a lower interest rate than with your credit cards and it may be a fixed-rate loan which can be an asset. However, there are also drawbacks to using social lending to pay off your debts. A reduced level of privacy when taking out your loans is one of the major reasons that people might prefer to just deal with their credit card companies directly instead of using social lending to get out of debt.
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Teresa | Jun 15, 2009 | Reply
Wow I have never heard of Social Lending before. I need to pay off some of my bills ASAP so I was thinking about going to a payday loan place and doing it that way. This sounds like a better Idea and I am going to try it. Thanks for the information.
Steve | Jun 15, 2009 | Reply
I would say just go get a payday loan. They are much easier to get. You just walk in with a bank statement and get your money. I have used many payday loans and I would say do that over Social Lending.
Ryan | Jun 15, 2009 | Reply
I have such a high interest rate that this would be great. I went to a payday loan center and they had such a high interest rate that I did not end up getting the loan. I am going to look into this because I need a loan but not with all this interest. Thank you for the information.
Joshua | Jun 15, 2009 | Reply
This sounds like a great idea. I need a loan but I did not know what I should do. I am going to look into Social Lending. Thank you so much for the information I dont know what I would have done.