Do you know where to go when you need money?
Being a student with £9000/year tuition fees means that I’ve thought a lot about ways people borrow money over the past few years. Thankfully all of my friends and I have found ways to pay for our tuition, be it loans from the Student Loan Company or help from parents, as higher education is not something that we’d even consider sacrificing. Unfortunately, this is not the case for everyone. There are loads of people out there who don’t know where to go when they need money and when money’s tight and you’ve got bills to pay, people often turn to ‘quick-fix’ solutions where they end up borrowing money with a disgustingly high interest rate. There are too many tales of people who get sucked into schemes like these and then end up even further in debt. Fortunately there are many legitimate options out there to those looking to borrow money. Borrowing from the bank can be a long process, and often people need the money a lot sooner than that. That is where companies like Lending Works come in. Lending Works is a newcomer to the borrowing and lending scene, having only established itself around a year and a half ago, however, it has already been recognised as one of the best services of its kind.
What’s more difficult than finding someone to loan money to you, is finding someone trustworthy to borrow money from. There are so many companies out there that are just trying to take advantage of people in desperate situations and they profit massively from them. Lending Works is not one of those companies.
What is Lending Works?
Lending Works is a peer-to-peer lending service, which means that this is service both for people that need money, and for people that need somewhere to invest money. They cut out the financial institution in the middle and match shrewd lenders with personal loan borrowers so that both end up with a better deal.
Who is Lending Works for?
Lending Works looks for creditworthy people who are looking for loan, and also people with some extra money they’re looking to invest. They have been particularly popular with pensioners as lenders who are over 55 can draw down cash on a monthly basis from funds that are being repaid by the borrowers. More than half of the lenders on this site are aged 55 and over.
How does it work?
Lending Works offers a rate of 4.8% on any money loaned over three years and 6% for money loaned over five years. This rate is better than any of their competitors, for example, leaving this in a TSB Classic Plus account would give you 5% interest,as would RateSetter. They also offer debt consolidation loans, so you can combine all of your previous loans into one loan which is much easier to manage.
Is it safe?
Lending Works is not covered by the Financial Services Compensation Scheme, however, it does offer three layers of protection to lenders. Borrower’s backgrounds are checked thoroughly and only the best are approved. There is a Lending Works Shield, a provision fund combined with insurance policies to protect against any missed payments or defaults.
Still don’t trust them? Lending Works has been featured in The Guardian, The Independent, The Daily Mail and The Financial Times.
How can I apply?
To apply you need to be over the age of 18 with a UK bank account. To become a lender, Lending Works will need to validate your identity to help prevent against money laundering or fraud. To become a borrower, you need to be at least 20 years old and they will verify that you are creditworthy and have the means to pay back the loan.
Anyone used Lending Works or a similar company before? I’d be interested to hear your thoughts on borrowing/lending of this kind!