Borrow money without the intervention of the bank

Borrow money without a bank, from private individual to private individual, online. The private lenders and borrowers determine the interest rate themselves. Applying for a loan often only takes a few hours. And the risks are limited because the lender does not lend to one party, but participates in more loans with small denominations.

How can you borrow money without a bank?

Borrow money without a bank or without advice from the bank. Consumers are increasingly deciding to take out a loan via the internet. Not only to avoid an annoying assessment at the bank and BKR, but even more because of the cost benefits associated with it. In practice, there are 2 interesting options common in this area:

  • Borrow money from private individuals on internet credit portals;
  • Take out a loan online without personal advice, also known as “execution only”, with an additional interest discount, without commissions.

Borrowers and investors find each other on the Internet

Young, mobile and active in social media, this is how a new generation of investors presents itself who makes creative use of the internet. Not only are the demands on technology very high, as people want to manage their financial affairs via BlackBerry or Netbook , but investors also want to gain more control over products from banks and financial advisors. In addition, a cooperative approach is receiving new impetus due to the financial and economic crisis. A new customer-oriented philosophy has provided sustainable institutions such as Triodos Bank and GLS bank with remarkable growth in their customer base over the past year. Transparency in particular is crucial in this context. After all, many people have lost confidence in financial advisors. According to a survey by a well-known internet portal, it was almost two-thirds. The GLS bank, for example, informs its customers in writing several times a year about the companies and projects in which they have invested.

Online providers benefit from a crisis of confidence

Other financial institutions have also responded to this new concept and, instead of high application fees for new accounts, now apply a flat, fixed advisory remuneration, supplemented with a performance-related reward if the investment later yields a good return. However, new online providers also want to benefit from the crisis of confidence, who have based their business model on the principles of Web 2.0 , the interactive internet model . In technical jargon, these models are also referred to as Social Banking or Social Lending .

Borrowing from private investors

Internet company Smava, for example, acts as an intermediary in loans from private individuals to private individuals. In their own words, they are something like a modern people’s bank that operates on behalf of and in the interests of the customer. The special thing about it is that private lenders and borrowers determine the desired interest rate themselves . Since the lender does not provide one loan to one party, but invests in small denominations to multiple borrowers, the risks are limited. Behind Smava, the BIW bank, a recognized credit institution, provides legal security. In addition to Smava, which operates from Germany, mediation sites have been active since 2005 in England, America and soon also in the Netherlands .

Settlement of credit often only takes a few hours

The provision of credit from private individuals to private individuals will still take some time to prove itself as a fully-fledged alternative on the market. But the German consumer organization Stiftung Warentest has already stated about Smava that the company offers safe and reliable conditions . The credit intermediary checks the reliability of loan seekers with its own valuation model. After all, one cannot afford a high failure rate. The great thing about the Smava concept compared to other renowned online credit providers is that the lenders know the purpose of their loan. As a rule, it only takes a few hours before sufficient lenders are found for a loan application. The high motivation among customers is due to the fact that they do not act as an applicant towards a bank, but negotiate directly with each other person to person. Even wealthy private individuals are now offering large sums of money to Smava: the attractive thing about this is that you decide to whom you lend your money.

By far the cheapest form of loan for young people

Borrowing from private individuals via the internet may offer advantages for many borrowers, but this certainly does not apply to students. A supplementary loan from DUO (formerly IBG) is by far the cheapest form of borrowing for them . More than a fifth of all students supplement their student loans in this way. No provider can compete with the interest rates of the IB group. The interest is immediately added to your debt, but you can postpone repayment for up to two years after completing your studies. An interesting option in view of the late student fine as introduced for the 2012/2013 academic year. Another nice extra: debts with DUO are not registered with the Credit Registration Office (BKR), so that they will not affect your borrowing capacity later.