Creative Ways to Connect Lenders and Borrowers Online

US residents and small businesses who may be seeking loans can now join Cyber City Capital, a Regionally-based consumer finance group that is taking advantage of a new company called Prosper that connects lenders and borrowers online anywhere in the United States. Cyber City Capital is led by TNP Capital a subsidiary of TNP Enterprises, Inc.

“Until now, banks and credit card companies have controlled who is able to obtain credit and the rates people pay,” said James Tilford, Chief Financial Officer. “With Prosper, individuals have the opportunity take control of consumer credit by dictating the terms of their own loan and placing it up for bid in an online auction. Cyber City Capital assists new members and helps drive down potential interest rates even further because of our collective repayment history. Ultimately Cyber City Capital members directly benefit from the quick efficient consumer loan process while never having to leave their computer.”

Prosper’s people-to-people marketplace is intuitive for those who have used eBay, but instead of listing and bidding on items, people list and bid on loans. Interested borrowers begin by creating a loan listing for up to $25,000 that includes the maximum interest rate they are willing to pay. Lenders can then begin bidding to fund portions of the loan, potentially driving down the interest rate. Once the auction has ended and the loan is funded, Prosper consolidates the bids with the lowest rates into one simple loan. Prosper handles all ongoing loan administration tasks including loan repayment and collections.

Local borrowers can also consider joining Cyber City Capital. At Prosper, people who borrow as members of a group can get better interest rates from lenders because the character and reputation of the group gives lenders more confidence that loans will be repaid. Cyber City Capital is comprised of a diverse group of borrowers and lenders. Cyber City Capital’s successful repayment history should attract more bidders offering lower rates to new and existing members.

“This is an very unique and exciting concept,” says Larry Smith, CEO of Benchmark Solutions, Inc., a business solutions and consulting firm located in Eugene, OR. “Borrowers greatly benefit from the ease of the process. It takes about 3 minutes to complete a loan listing. All loans are processed electronically and borrowers do not have to go to a physical location during business hours to fill out an application creating an extraordinary opportunity.”

Interested lenders can also participate in Prosper by making loans to other individuals. Lenders can search for loans that meet their specific criteria, including: 1) credit scores; 2) debt-to-income ratios; and 3) historical default rates. Once people are ready to bid on a loan, they set the minimum interest rate they are willing to earn, and bid in increments of $50 to $25,000 on loan listings that they select. Lenders often minimize their risk by bidding on many small loans across different credit grades instead of concentrating their money in one big loan to a single individual.