What is peer-to-peer (P2P) lending?

Peer-to-peer lending, also known as P2P, is a form of lending that connects the lender directly to the borrower through a P2P website. P2P lending offers an alternative to traditional bank lending and can be beneficial for borrowers who may have trouble qualifying for a loan through a traditional lender.

What is a peer-to-peer personal loan?

However, some companies offer peer-to-peer loans, which means the funding for your loan comes from another individual, not an institution. Peer-to-peer (P2P) loans can sometimes be more accessible to borrowers thanks to easy application processes and sometimes higher loan amounts. CNBC Select rounded up the best peer-to-peer personal loan lenders.

How much does a peer-to-peer loan cost?

Compare interest rates and fees. Similar to personal loans, interest rates on peer-to-peer loans generally range from 6% to 36%. Many lenders impose origination fees between 1% and 8% of the loan amount, plus other administrative costs.