I never expected myself to write about this topic, but debt-based crowdfunding has been growing tremendously in the last few years!
I’m talking about peer to peer lending, or getting an unsecured personal loan online. Websites have emerged that create mini-lending marketplaces. You can request a loan for various expenses and get it funded by users on the platform.
You can use some of these websites to pay off your credit cards, consolidate debt, refinance your student loans, and more. The best part is that it’s okay if you have a bad credit rating. Of course, your rating will effect your rate.
Hope this list is helpful!
1. Upstart
Upstart is my personal favorite of this list and although they are smaller than the next two platforms, I can see big things happening in their future.
You can use the platform to get an unsecured personal loan from between $1,000 and $50,000. There is also no pre-payment penalty!
It’s a lot cheaper than using credit cards to finance a major purchase and you can even use the loan to refinance existing credit card debt.
Overall, I like that Upstart takes into account your educational background, area of study, and job history.
Don’t forget to check out our review of Upstart
2. Lending Club
Lending Club is another platform that you can used to get a personal loan that will be funded by individual and institutional users. You can get between a $1,000 and $40,000 loan.
By far, this is the BIGGEST website out there when it comes to peer to peer lending and debt crowdfunding. They’ve earned the title, having helped many users pay off their credit cards and finance consumer purchases.
Lending Club has had a bit of trouble recently, but I’m confident that they’re going to bounce back!
Yes, we’ve also done a review of Lending Club
3. Prosper
Arguably, Prosper was the FIRST American peer to peer lending company and started this entire industry!
You can use Prosper to get a low-interest loan and get the money that you need quickly. This money can be used for auto/vehicle needs, home improvement, special occasions, and debt consolidation.
Remember, checking your rate won’t affect your credit score.
We’ve reviewed and broken down Prosper here.
4. Sofi
Sofi will allow you to borrow from between $5k and $100k with terms including 3, 5, and 7 years. The company will take your career experience, financial history, and monthly income into account when determining your rate.
Sofi also has what’s called “unemployment protection.” Should you lose your job, you can stop the payment of your loans (though interest will continue to accumulate).
Here’s what the website reads, “If you lose your job through no fault of your own, you may apply for the Unemployment Protection Program. If approved for the program, SoFi will put your loans into forbearance, suspending your monthly SoFi loan payments.
Unemployment Protection is offered in three month increments, and is capped at 12 months, in aggregate, over the life of the loan.”
This can be a lifesaver if your primary source of income was just taken away! The company also offers career counseling.
5. CircleBack Lending
The last website that I’ll mention in this list is CircleBack Lending. CircleBack was founded in 2012 and grants personal loans from between $3,000-35,000.
The most popular way that these loans are used are for debt consolidation and home improvement. You can choose from between a 36 and 60 month repayment period.
Although they aren’t the largest platform out there, they’ve gotten some pretty good reviews on Lending Tree.
