Many people like peer to peer lending for its low loan rates. Others celebrate its consistent and generous ROI. But the truth is that neither of these benefits are very profound. For example, while it is crucial to get out of debt (perhaps through a p2p loan), the process isn’t all that fun. Quite the opposite; making those monthly payments can be a real chore. This applies to investing as well. Earning a return is key to a healthy retirement, but it really isn’t all that interesting. A dull number on your screen slowly grows over a 2-4 decades until a certain retirement threshold is reached and you’ve “made it” — a long time to wait for a party.

My favorite part of peer to peer lending is something altogether different. What captivates me is its transparency and collaboration. Certainly competition exists, but the long storied history of peer to peer lending is really one of people figuring this out together.

To illustrate this, today I’ll review every peer to peer lending website in the United States, highlighting the part they play in the overall lending ecosystem.

Two American p2p lending companies

Many online lending companies have launched in the United States, but only two are purely peer to peer. Only two connect everyday investors to borrowers: Lending Club and Prosper. Additional platforms will launch in the future, but for now these are the sole two.

Lending Club

You really can’t talk about peer to peer lending without starting with Lending Club. The industry leader, founded in 2007, has gone on to issue over $9 billion in loans. Their site has the best user interface and the largest 3rd-party investor ecosystem. Recently, Lending Club went public on the New York Stock Exchange, becoming the first publicly traded online lender in history.

They offer loans between $1,000 to $40,000. Interest rates range from 6.6% to 29.9%. Their average loan is for $15,000 and has a 13.4% APR. Read: our Lending Club review for borrowers.

Lending Club investors: typically earn between 5% and 9%, depending on how much risk is taken on. Read: our Lending Club investor review

Prosper Marketplace

Prosper made history when they launched in 2006. They were the first ever American peer to peer lending company. Since then, the company has experienced tremendous growth and success, having recently issued an incredible $3 billion in loans. Recently, they were named by Forbes as one of the most promising companies in America.

Prosper offers loans between $2000 and $35,000. Interest rates range from 6.6% to 35.9%. The average loan at Prosper is for $13,000 and has a 13.9% interest rate. Read our loan review for Prosper.

Loans up to $40,000 Check your rate at both, go with the lower rate. Check Your Rate Check Your Rate Won’t hurt your credit score.

Prosper investors: typically earn between 5% and 9.5% depending how much risk is taken on. Read: our Prosper investor review

Peer to peer lending news and education sites

A wide variety of news and education sources have sprung up around these two companies.

Lend Academy

Peter’s Lend Academy blog has been the go-to source of anything involving online lending for years. His approach to lending basics and filtering is how many of us got our start. Week after week, him and Ryan continue their coverage of the latest p2p lending news and analysis.

LendAcademy.com

CrowdFund Insider

Crowdfund Insider is probably the most prolific lending news site in the nation. For example, they published thirteen news stories today alone (May 8). Lending Club and Prosper are common featured stories here. Also, if you’re interested in the wider non-P2P lending space, CFI has got you covered there too.

CrowdfundInsider.com

Orchard Platform

Orchard is another mainstay in the peer to peer lending world. Though their main offering is technology for institutional investors, Orchard’s blog has continued to be a wonderful source of interesting and novel analysis of Lending Club and Prosper’s open data.

OrchardPlatform.com/blog/ (May no longer work since Orchard was acquired by Kabbage)

P2PLendingExpert

Stu Lustman is a credit professional who brings his own value to this space. Furthermore, he has a unique take with peer to peer Bitcoin lending.

P2PLendingExpert.com

LendingMemo

Launched in January 2013, this site continues to be a joy and privilege to work on. Thanks for reading :)

Secondary blogs

Even though PeerCube and LendingRobot are more known for their savvy p2p tools, they operate blogs on the side that are filled with interesting and helpful information on this investment.

PeerCube Blog: PeerCube.com/blog

LendingRobot Blog (now owned by NSR Invest): blog.LendingRobot.com

P2P investing and analytics tools

Since all of peer to peer lending’s data is available to the public, and both the platforms allow access to their sites over API, a large tool ecosystem has evolved that offers investors a deeper way to analyze and invest in these loans.

NSR Invest

Probably the main investor analytics site for years has been NSR Invest (originally Nickel Steamroller). NSR offers a fast and robust backtesting tool that allows investors to breakdown the historical loan data in pretty much any way they desire.

On top of that, they offer great charts of industry growth, the most advanced portfolio analysis in the country (including Prosper), and fund management for accounts over $10,000.

Serves: Lending Club and Prosper

Cost: NSR Platform is free! (NSR Invest costs from 0.45% to 0.9%)

NSRplatform.com

LendingRobot

LendingRobot is the biggest auto-investing tool in the space, having received a lot of positive press as of late (TechCrunch). Their tool automates Lending Club and Prosper investments in a variety of interesting ways. Not only can you auto-invest with filters (video), but their Estimated Return parameter invests with an algorithm, allowing you to increase your returns without needing to learn filtering at all. They have pre-set filters for conservative and aggressive investment strategies.

Lately, LendingRobot even added functionality for the Folio secondary market, allowing you to automatically place loans for sale on Folio that, for example, drop a certain amount in FICO.

Serves: Lending Club and Prosper

Cost: free for small accounts, 0.45% of investment for accounts > $10,000

LendingRobot.com Update: LendingRobot has been acquired by NSR Invest

Peer Cube

Anil Gupta’s PeerCube has its own dedicated following. Of all the tools in this list, PeerCube is probably the most detailed. It has large descriptive charts for everything: from the average markup of loans on Folio to which year of your investment earned you the most money. The list really is too long to cover in a single paragraph.

Further, it can take this analysis and automatically invest in loans on your behalf at both Lending Club and Prosper. Pretty great!

Serves: Lending Club and Prosper

Cost: Pro Plan is $19/month (free option available)

PeerCube.com

Interest Radar

Rev’s investing tool Interest Radar has been a trusted method of investing for many years. It was the first to allow automated investing through Lending Club, and contains a large degree of secondary functionality. For example, here Interest Radar has broken down my Lending Club returns by portfolio.

Interest Radar also offers auto-sell features for your Lending Club Folio account. If one of your loans drops a certain distance in FICO, it can automatically place the loan on the secondary market for you.

Serves: Lending Club

Cost: 30 days free (then $9/month or $59/year)

InterestRadar.com

Peer to peer lending discussion

Here are the four main places people discuss peer to peer lending:

Lend Academy Forum

Peter’s forum over at Lend Academy remains the most active discourse on the internet, with a diverse community of lenders in talks about a multitude of topics. It has sections for both Prosper and Lending Club, as well as all the major tools.

LendAcademy.com/forum/

LinkedIn

inGroups: Group A and Group B

Twitter

Hashtag: #p2plending

Reddit

/r/SocialLending: Reddit.com/r/SocialLending

[image credit: Wyman Laliberte “1917 Map of Winnipeg” CC-BY 2.0]