Peer-to-Peer Investment in Opposition to Equity Investment
Person-to-Person or peer-to-peer lending involves lending money from one individual to another. P2P loans are an investment opportunity that many people are embracing at a high rate. I P2P lending, borrowers opt not to seek financial help from tradition lending institutions due to the fact that there are many qualification procedures that must be passed. P2P has succeeded in eliminating traditional financial intermediaries by establishing online private investing on online platforms. Peer-to-peer companies like Blackhawk Corp have embarked on connecting borrowers with the corresponding investors.
Major pros of investing in peer-to-peer lending include:
-Stable interest rates that do not depend on the economy but on the agreement between the borrower and investor compared to CSF that instead depends on the economy.
-More income achieved from interest rates charged by the investor unlike the interest gained from saving your cash in traditional banks.
-As the number of borrowers increase so does the income because there will be an increase in the amount of money gained from multiple interest rates.
-Minimum risks in P2P due to the security conditions placed in case the borrower does not clear a debt. This provides a constant income flow without losing your money to borrowers.
-P2P lending provides the investor with a chance to interact with the person acquiring the loan as the transaction process is conducted online.
Many people invest money for various long-term commitments as well as pension tend to believe that CSF is the best mode of investment. This involves choosing equities that are able to produce high returns. Equity investment provides a good opportunity for commercial mortgage brokers to convince various investors on the most profitable mortgage to buy shares from. This is because they provide a good income potential compared to residential mortgage. The annual return off the buying price ranges between 7% and 13% depending on the location. CSF operates commercial property as a business thus the annual return is shared among the shareholders, unlike P2P where the private investor is the sole owner of the return.
Many people opt for secured investments in order to prevent any risks. Traditional banks have seized from being the only financial provider as peer-to-peer lending and equity investment provide a better opportunity for many people to generate more income. Compared to P2P, CSF has also attracted many investors as it provides the investors with a greater chance of earning more cash depending on the type of share bought from the stock market. Peer-to-peer investment poses a greater chance of not losing your money as it offers platforms that involve giving out secured loan to the borrowers.