A cool way to get funding for your eBay business in a bad economy

I am such a busy body that I can't sit still long enough to watch much TV but I love to listen to NPR while doing my photographing and measureing for my eBay auctions. I must say, it has gotten pretty depressing lately all this talk about how bad our economy has become and the credit crunch and the housing bubble and all that. But it finally hit home when I opened my recent statement from my money market account and I am only earning .2%! This time last year I was earning 5.6%, and yes, that was a point BEFORE the 2.
How depressing.
Thankfully, my eBay sales have not tapered off. Yay!
So, I looked at the places that I had my savings stored and would you believe, my highest earning interest rate is the two loans that I lent out on Prosper.com.
If you aren't familiar with Prosper, it is a people to people lending market. People can go sign up at Prosper and either loan money to individuals or borrow money from individuals. Prosper does the credit check and keeps track of the loans so they take a small cut of course. The way they set it up in order to lessen the risk for the lender is that a borrower is actually borrowing small amounts from many different lenders. The borrower sets up a profile, much like an eBay auction, where they tell how much they need, what it will be used for, and the intrest rate they are offering to pay. Then, prosper checks thier credit, gives them a score and posts any delienquents or anything. (no identifying information of course) A lender will pick out listings that they want to bid on and can bid by interest rate on the people they want to lend to, lending as little as $50 on each loan.
So, a lender wanting to lend out a thousand dollars can actually spread it around and loan $50 to 20 different people. And, a borrower who borrows $1,000 can have it come from 20 different people.
I got a $5,000.00 loan from Prosper last summer and I orginally asked for 13% interest. So many people bid on my loan that the interest was pushed down to 9.45%!!
So, I re-invested some of that money back into other people asking for Prosper loans and am earning 16.75%.
It is sort of like taking out the middle man. Well, I guess Prosper is still the middle man, in a way, but cheaper than a traditional broker. Prosper loans are a maximum of $25,000 and are only 3 year loans (no penalty for paying it off early though).
I am writing about them here for two reasons, one, I love Prosper and thik it is such an innovative idea and two, if you sign up and either bid on a loan or get a loan funded, I'll earn a commission!
So, if you want to check it out... click my little ad here:


Thanks.