There are many reasons why borrowers are attracted to peer-to-peer lending over other traditional lenders and banks. This includes:
- Greater flexibility
- All credit histories considered
In this guide, we take a closer look at each of the above points to explain the advantages of choosing a peer-to-peer lender over other types of lending.
Flexibility
Peer-to-peer lending platforms appeal to many due to the flexibility they provide to borrowers. Depending on the lender, you can borrow for a few weeks, months or years – which can be useful depending on your requirements.
By comparison, other mainstream products such as
payday loans or personal loans, can come with penalties or added interest for delayed repayment or extending your loan.
Fund Ourselves also allows you to repay your loan early, at any point, and there are no fees for doing so.
All credit histories considered
Peer-to-peer lending platforms like Fund Ourselves also consider those with bad credit histories, unlike many other kinds of high street or traditional lending.
For example, with most types of
personal loans advertised, you will need to have a good or fair credit score in order to be accepted.
The reason that peer-to-peer lending is able to consider bad credit histories is because there are investors on the other side of the portal who are willing to lend to riskier credit profiles – in the aim that they will earn a higher interest rate than a typical ISA.
The ability to offer affordable finance to both good credit and bad credit customers makes peer-to-peer loans a very accessible and attractive proposition for a lot of people.