For those people who go there to borrow money who aren't there because no one else will give them a loan, Prosper does have one nice feature.
I told you that borrowers put down the interest rate that they want. This is the starting interest rate. Lenders then start bidding on the loan at the amount of interest that the borrower has suggested. If the amount of the loan is funded before the bidding time ends, lenders can continue to bid. To get in on the loan, they have to bid a lower interest rate.
This is a great aspect of Prosper that you don't find at banks or credit card companies. Since all the lenders can see what the bidding is, they can choose to continue to bid or not. The result is that many borrowers get their loans funded at lower interest rates than they thought they would.
In one case, I saw bidding take an interest rate down 9%. That's huge! You wouldn't find that out in the banking world.
Even some of the less dramatic changes in interest rate of 1% -1.5% is great. It's a matter of how much lenders think they are risking. At some point, lenders quit bidding because the risk outweighs the gain for them or because they are looking for a higher return regardless of risk.
If you have fair credit, a good debt to income ratio, a plan, and want to consolidate high interest credit cards, Prosper might be the vehicle to help you out.
Tomorrow, let's talk about sex.