How to get a P2P Loan [infographic]

Peer-to-peer loans are a huge part of the small business loans rage these days. Here at Lendio, we’ve compiled this infographic explaining what they are and how to get them.

How to get a peer to peer loan

What is a P2P Loan?

A peer-2-peer loan is an alternative to traditional lending, in which the borrower receives a loan from another individual rather than a lending institution. Those with money to invest for profit can join a P2P lending network and give out loans to those who may not qualify elsewhere, especially those looking for a business loan when they have bad credit.

Growth of the Industry By 2013

The Gartner Research Company reports that by 2013, there will be $5 billion in outstanding business loans. That’s up 66 percent.

“Growth in P2P lending will be driven by investors seeking higher returns and borrowers shunning (or being shunned by) banks,” said the Gartner Research Company.

What Can You Use a P2P Loan For?

It can be used for personal use, small business funding and debt consolidation.

“Really it’s a nice outlet for both borrowers and lenders, and it’s going to be more and more prevalent in the future,” said Michal Herzenstein, professor of marketing at University of Delaware.

How Much Can You Typically Get

P2P loans don’t need to be huge amounts of money. Leading P2P loan companies, such as our partners Lending Club and Prosper, offer $1,000 to $35,000 for personal loans. They offer up to $35,000 for small business loans, and debt consolidation up to $35,000. Current interest rates can range from just less than 6% all the way up to just over 35 percent.

Are There Fees with P2P Loans?

P2P loans carry several fees charged to the borrower. Typically, fees for these loans are lower than traditional loans. Transaction fees are usually 1% of the sale price. Loan origination fees, which are usually included in the rate, range from 0.5% to 5.00%.

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  1. If I was to ask for and receive $20k for “small business funding”, what would be my payment options?

    Do these loans require collateral?

    Are these loans difficult to qualify for?

    How long does the process take?

    Thank you!

    • Payment terms depending on the peer to peer lender chosen range from 1 to 5 years. There is no collateral required. In order to qualify you simply need to have credit scores in the 640 to 660 range. The process is very simply with a one page on-line application. You will be immediately know if you have been approved for funding. If approved, they will let you choose the loan term that fits your situation and then begin the process of funding your loan.

  2. I have a business in the oilfield that the last two years alone lost enough to pay back what I need to borrow. However, I need the money to get started. How would I need to move forward since I haven’t any collteral to cover a loan that I could prohably pay back in two to three years.

    • There is no collateral required for a peer to peer loan, please take 5 minutes and fill in the application to see if you can receive approval to get your business the funding it needs.

      Good Luck.

  3. I just enrolled with Lendio and currently going through the credit enhancement program. However, my credit score is between the range required for the P2P program. So, how can I apply and not interrupt the current process with lendio’s credit enhancement for the traditional business loan? signed desperate business owner….

    • Michelle,
      I’d like to have one of our reps reach out to you by phone. We’ll use the phone number we have on file to do this.

      -Doug Minnick

    • If the bureaus are not reporting any fraud alerts on your credit file you should be able to apply. Fraud Alerts are often placed on a credit file while changes are being made to protect you. Since P2P’s do a soft pull it will not effect your credit unless you are approved. If approved they will be required do a hard pull to complete the application process.

  4. i have been looking for a loan and i had a company call me and said i was approved for a $10k loan but due to my credit i would have to secure the loan with $3k i did and then there phones quit working i got scammed. and now i need a loan even worse than ever but its been really hard to find anyone to help. my credit score is in the mid 500s so from reading i probably wont be able to get one here either. if anyone can help please get in touch with me thank you

  5. Can you please send me all of the information on who to contact for a small business P2P loan looking for a $10,000 to $20,000 P2P loan, no collateral, for small business start up. My business credit score has no scratches on it, but personal credit score is 525, where can i get a P2P small business loan.

    • Holly, I sent your information to our sales team. But, you can also sign up for a free Lendio account to guide you to the best type of loan (which may or may not be a P2P loan). Let me know if you need anything else.

  6. Like Holly, I also would like to know who to go to for a p2p loan. Can u help me? You can call me at 512 785 7307. Thanks!!!

  7. If your credit is real bad but your trying to keep your business open, the bank won’t touch who out there that does help in this catorgory . Please e-mail with an answer if you know who can help business with bad credit

    • Hi, Brenda. The truth is, it’s tough to get a good loan with bad credit. However, we do have some partners that help people with lower credit scores get financing. If you create a Lendio profile (by clicking on the ‘sign up’ above), you can find what loans you may be able to qualify for. If you need some help building your business credit, we also help people do that. Let us know how things turn out for you.

  8. Hello
    Need a loan?i can help you with a 2% interest rate,get back to me if interested.

    [email protected]

  9. I need funding of a real estate investment business to buy bank foreclosures and other real estate at less than 50% of value and resell for profit. my credit is 580-620
    See my website and email me
    I need help finding loans or investor partners
    I will share profits up to 50% on each profitable home
    Orville Stephens cell 314-255-3253

  10. Hello. I am in need of a loan and my credit is bad. I am told that it is possible to get a loan, but its just a matter of finding a lender. I truly need some help because expenses are piling up. I have a good and secured job and will be starting a new one, but I need a boost as they say, in order to get things back on track. please help..

  11. Hello, I am interested in getting a loan for the purchasing of investment homes for resale and leasing. I’m not sure of my credit score however I don’t believe it is 660 or above. Please let me know if you could provide direction.

    • Hey, Linda. There are factors other than credit score that will apply here. Have you signed up for Lendio yet (there’s a sign up link on the upper right of the page)? It’s free and should guide you to some options you could qualify for.

  12. Good morning:

    Looking for a loan of 6 to 8k
    Home improvement of a free
    and clear, rented (1100.00/mon)
    2 unit property in Detroit.
    Ex military, Moved here for job offer that fell though.
    Bad credit, wife had a break down during my last deployment all money gone no bills paid credit score crashed.

    I will assign rent receipts for repayment and offer property as collateral.

    I just need to get over this hump

    Thanking you in advance

    Darryl Weaver

  13. Hi, I would like to know if I qualify for this program even when my Credit Score is poor, I want to consolidate my debt and improve my credit score.

    Thank you

  14. Need a small personal loan to get back on my feet credit score is around 560 I have tried banks and other online sites but no luck loan would only be for 2500

  15. I am a desperate female with a poor credit in the low 500’s. I am about to open a restaurant, location is perfect, but because of my poor credit score, I am unable to open. I just received my building permit,
    But ran out of funds to pay to get the work done. I have most of my equipment. The landlord is asking for 2 months rent again. I am converting a jewelry store into a restaurant. A loan of $35,000 will complete it. If I do not come up with it adapt, I can loose everything I already invested. Please help me. I do not care what the interest rate is.this is urgent.help, help, help. May God be with me.

    • Hey Claire,

      You can find out if you have any business loan options by signing up with Lendio. If you don’t have any options, we’ll point you in the right direction for fixing your credit so you can qualify for a loan.


  16. With a P2P Loan, does this help build the credit rating for borrower?

  17. Where are these P2P loan platforms?

    • Hi Steve,

      You can get more information here about P2P loans. Once you fill out an application, our Funding Managers can help navigate the waters with you. Hope that helps!

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