Private lenders exist because borrowers want quick responses and speedy funding to secure a business or real estate deal. Marketplace lending has become a success in the financial sector all over the world. This is mainly attributed to the following:
- The launch timing of peer to peer (P2P) lending coincided with the collapse of major banks and financing companies all over the world. The lack of loans and the zero returns that most savers got made market place lending a more attractive and promising alternative compared to banks.
- P2P offers positive user experience. The industry was designed to be online based, low cost and offer a better experience for customers when compared to banks. With no branches, clients cannot wait in long queues. Furthermore, the services are available 24/7.
- Vast financial experience. Most P2P lending companies were founded by professionals who understand the financial sector very well. Therefore, they use their innovations to ensure that their financial solutions are beneficial to both the borrowers and the investors.
- The constant evolution of P2P. Marketplace lending has lots of room for expansion. Individuals are now taking hard money loans to boost their businesses or invest in real estate. Over time, P2P loans may even cater for college fees or student loans.
Banks and other traditional financiers may offer lower interest rates for only the select few lucky borrowers. On the other hand, P2P lenders offer easier access to loans greater transparency and speed in making decisions. This has significantly contributed to the growth of the P2P sector.
Most consumers are now turning to P2P companies for loans for their businesses or properties. This is mainly because of the frustrations that they go through with traditional lenders. P2P puts the customer above everything. Furthermore, Some P2P lenders will also issue commercial notes.
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