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Debt consolidation continues to be popular option among peer-to-peer lenders
By Angela Hawke on Feb 24th, 2010
Recently, a peer-to-peer lending website noted that debt consolidation continues to be a popular option among consumers.
According to Propser.com, the number of peer-to-peer loans for the purpose of debt consolidation hit an all-time high in January of 59 percent. The company noted that traditionally debt consolidation comes in at 45 percent of all loans.
One reason why consumers may be opting for debt consolidation loans is that they can give people a way to pay off credit card debt at lower interest rates. Many card companies have been increasing rates as the result new regulations from the federal government.
"Credit card rates have been going nowhere but up, and in the wake of the Credit CARD Act they are likely continue to rise along with balance transfer and annual fees as credit card companies scramble to make up for income they were generating from egregious practices," said Chris Larsen, CEO and co-founder of Prosper.
Along with lower interest rates, debt consolidation loans can make paying off bills easier by reducing the number of statements that a consumer has to deal with. This could make it less likely that a person will miss a bill payment, which could bring additional fees.
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