Debt Consolidation Strategies Using Peer-To-Peer Lending Platforms

Michael Kitces writes about the recent explosion of the peer to peer lending phenomenon as well as some of its potential pitfalls in a recent article. The post begins as follows:

In just the past few years, Peer-to-Peer (P2P) Lending has exploded from a potentially disruptive lending niche to a major segment of consumer borrowing responsible for a whopping $5B of loans in 2014, driven in large part by investor demand for fixed income alternatives that provide better yields in today’s low-interest-rate environment.

Yet the reality is that P2P lending isn’t just about investment opportunities – for many, it’s a key source of borrowing potential, particularly to consolidate and refinance existing credit card and other debts at lower interest rates.

In this “Financial Advisor’s Guide To Peer-To-Peer Borrowing”, we discuss the mechanics of how borrowing via Peer-to-Peer Lending actually works, the rules and requirements, the costs and the caveats, and the situations in which financial advisors should consider exploring a P2P loan as a financial planning strategy for clients!

Read the full article here.

Posted by Logan Dais, Associate Editor, Wealth Strategies Journal.

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