Originally Posted by Pleasurepays

ok... the point is that there is never a shortage of commercial lenders. thats a fact. if someone truly has "good credit" by a lenders standards, they should never have trouble borrowing money.

those lenders compete with each other for the business and to make the loans and its a highly competetive game from a lenders standpoint... so much so, that many big mortgage companies have restructured their business models so they are not dependent on interest rates and make money on mortgage insurance for the loans they write and on other financial instruments.

the idea of a bunch of people getting together to lend money to each other is nice if you buy into the idea that you can't get a great deal if you are qualified anyway (basically you have to head down the conspiracy route) - you can be dead broke, have shitty credit and buy a BMW right now. 18 year old kids with no credit history get flooded with credit card offers.

so what i am saying is that money is always out there to borrow from traditional lenders. its everywhere. lenders are looking for qualified borrowers and there is a lot of competition to give you the best deal... that would mean that people on this site would be somehow competing with traditional lenders which, unless you are motivated purely by philanthropical reasons, you would be making a shitty investment (lending money) and none of these guys will ever do it as well as a traditional lender, manage the risk as well, be able to absorb the bad loans and do it for the best rates.

if a person can't get a great deal on a home loan for example from a bank or mortgage company, it would be hugely irresponsible for a private investor to loan that guy money. he would have to adjust the numbers to cover the risk - bigger down payment, higher interest etc and always be on par with what a traditional lender would offer.

Citi Bank or Wells Fargo or Bank of America does not pull their interest rates or lending criteria out of their ass. They have complex risk assessment models and are great at knowing who is a good risk and who is a bad risk. A site like this in my opinion is nothing more than a naive, utopianistic view of how the financial world works and someone who would lend money in this way is irresponsible and naive as well.