For a private loan, the lender is a private individual. The lender or lender was often earlier in the private environment (friends, relatives, neighbors etc) to find the borrower. Nowadays, there are portals on the Internet that provide loans from private to private online. It is not necessary to contact a loan shark.
The advantages of private lenders
The advantage of private loans is the quick provision of the required amount of money. Equally advantageous are the individually agreed interest rates and the terms and also partly the verbal agreement with a friend or family member. For example, when borrowing money from a family member to renovate a home, the lender or lender is usually comfortable with the borrower’s financial situation, and the money is quickly made available without collateral and credit checks.
The credit rating of a private loan
The creditworthiness should not be completely ignored when lending within the circle of acquaintances. If the borrower or borrower who asks for a loan from a private bank has already been rejected by a bank because of its creditworthiness, the future lender or lender will take a high risk here. If the borrower or borrower is unable to meet a payment date, it is possible to re-adjust the term in a call, but these problems can then continue to increase, or the borrower or borrower cancels payments completely. In such a case it makes sense to have a written contract. However, this can also lead to problems if the clauses contained therein are not properly formulated. Likewise, because of the repayment problems, the personal relationship with the borrower or borrower may also be heavily charged.
The private credit intermediaries on the Internet
Brokerage platforms, such as or , bring together online lenders or creditors or borrowers. The types of loans brokered on these platforms are mostly installment loans, for which terms and interest rates are individually agreed.
Such a loan over the Internet has some advantages over the installment loan from a bank. These include, among other things, a less burdensome procedure for the awarding of the loan, the fees are lower (depending on the term and the amount of the loan), sometimes lower interest rates (to be negotiated); a possibly lower acceptance threshold (creditworthiness, security) or no reporting of the lending and the loan request to the remark.
Private credit providers
The access threshold for the private loan is lower here, in contrast to a loan from the bank. Nevertheless, these are not completely eliminated. Again, the credit rating (salary statements or remark entries) or existing collateral are checked.
The advantage of a credit project on the Internet for the loan or borrower here, however, by the present, even though this project despite negative remark classification and there may convince the future credit or lender of the concept may.