Online Lending Auctions

Need a Business Loan?

Getting a loan for your small business can be a daunting task. Banks have strict lending guidelines and they can bury you in paperwork.

But now there is another option: Online lending auctions.

The format is just as it sounds. Borrowers request money and lenders can bid on the loan. But while this may sound similar to such outfits as Lendingtree.com, think again. It is more like Ebay.

Borrowers can tell their story and plead their case for why they need their loans. And individuals who have money to lend can bid on the loan. The status of the auctions are shown in an online auction-type format. Also, one loan may be funded by multiple borrowers, which helps spread the risk associated with lending to high-risk borrowers.

Online Lending Auctions

Peer-to-peer lending has hit the web. Learn how these websites allow borrowers and lenders to connect with each other in an online auction format.

Online auctions sites allow borrowers to request loans up to $25,000 and set the maximum interest rate they are willing to pay. Individuals who are willing to lend money can then bid on the loans. Such websites also allows individual borrowers to create groups to pool their resources and get better interest rates.

The first online person-to-person lending and borrowing exchange websites have been around since 2005. Formed in the UK by the people who founded Egg, the world's largest online bank, the company currently has over 75,000 members.