Searching For Low Cost Home Improvement Loans? The Internet Is The Place To Be

By Author: Scott F. Staudt
Total Articles: 91
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The home resale market is still severely depressed, so many homeowners are not in a position to sell their houses if they need to expand. Many homeowners should therefore consider improving the home they live in, and a new opportunity for home improvement loans is available with peer to peer lending.

Investing in your home remains one of the best investments you can make, and if you have wise home improvements, you are fairly certain you will recover that investment over the long run. A new roof, a new kitchen, or even just new appliances for your current kitchen, can improve the value while making life better while you live in the home.

But the biggest hurdle may be to finance these improvements through a home improvement loan, and a unique opportunity for home improvement loans now exists in the online community. This opportunity is called peer to peer, or person to person loans.

Most home improvement loans have been funded by banks or other financial entities. But if your house has very little or even negative equity because of the recent real estate slide, you may not be able to secure a traditional ...
... bank loan.

If you consider where the funds banks get their money from, you will realize there is a better solution. They get this money from depositors, who are in actuality lending the money. Wouldn't it be perfect if the depositors could lend the money directly to the borrowers?

People who have extra money to invest may consider depositing it in a bank, but that kind of investment only yields about 1% today. Nevertheless, banks are still charging more than 10% for a home improvement loan. Where does that large difference in rates wind up? Right in the pockets of the lenders, that's where. This is one of the main purposes of peer to peer financing, to get rid of this expensive middle man. Investors can grant home improvement loans to borrowers at rates higher than they would receive on a bank deposit. This savings can be given to borrowers in the form of lower borrowing rates.

This kind of investment is very attractive to investors because they can spread their risk out over many different borrowers (this is a unique feature of peer to peer lending) and decide upon the individual level of risk they want to take. Borrowers also have this numerical advantage since many investors are now competing to lend them money.

Most peer to peer lending is structured as part of an online site that works in a manner that is like Ebay or other auction sites, where buyers and sellers bid on goods. Investors have the opportunity to review all of the potential borrowers and decide who they should lend to (invest in). Lenders also have the choice of knowing the purpose of the loan, so they can specifically choose home improvement loans if that is what they prefer to invest in, which is an added feature that makes the program attractive for both investors and borrowers.
Start planning your future with investment opportunities and home improvement loans