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A loan utility that consolidates startup capital

Submitted by: RedTable
Created: Sep 2, 2007, 6:12 am

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The Idea

A loan utility that raises and consolidates startup capital from friends and family under one simplified loan.

Example:
30 lenders (Family, Friends, Fools) = 1 monthly loan payment

I thought of this idea when I was...

I raised $100,000 in loans from 9 lenders, family and friends, with an interest rate of 9.9%, 3 year loan term. The problem was that each month I would have to write a check to each lender, costing me time and money for stamps.

So I said why not create a loan utility that raises the funds from family and friends and consolidates the loan into one simplified loan. Every month the system would debit via (ACH) my bank account only once for the "total loan repayment" and credit via (ACH) each lender's bank account automatically. Each lender would be notified via email of payment.

So example:
Cousin Charlie $5,000 loan amount
Alex: $10,000 loan amount
Helen: $30,000 loan amount
John: $55,000 loan amount

= $100,000 business loan
Interest rate: 9.9%
Monthly repayment: $3,600

Each lender would get a different repayment amount depending on loan amount provided.

Comments Posted

saigon Posted: September 2, 2007, 9:40 am

Cant a pre agreed term of payment handle this and let your secretary do the walk?

RedTable Posted: September 2, 2007, 1:11 pm

If you have 10 or more lenders, the system will consolidate the loan amount into one loan, and then automatically repay your lenders on terms agreed to.

If you would like to hire a secretary to do all this, then you have started to waste your startup capital already.

collabori Posted: September 3, 2007, 8:28 pm

You could leverage the website Prosper.com to manage the loans. Once your loan is funded, the full payment is deducted from your checking account and distributed to the individual people. For this they charge a closing fee and an annual service fee. You might even have other people interested funding your project, too.

RedTable Posted: September 4, 2007, 6:39 am

Oh F***K prosper.com, raising money from friends and family is private affair. And the truth is that no friend or family member looks to prosper from their friends. Do you see aunt alice posting a pic up so cousin bobby can loan her $100?

PetersonLimitedCo Posted: September 27, 2007, 4:21 am

It would be a small market, but it would be a useful tool I believe. Maybe the back-end structure is similar to prosper.com, but the market this would be directed to would be different. I believe with the right marketing angle, this is a feasible and profitable idea.

Urbanbumpkin Posted: September 30, 2007, 5:58 am

actually there are some websites doing the same thing. such as zopa.com

but that sort of website still on the very first-stage..so the market competition is not hot..u should do it asap.

Rich2809 Posted: November 21, 2007, 8:49 am

anger management

Hello!

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