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Loans

Lend to a Friend: VirginMoneyUS.com

Richard Branson's latest venture is less far-reaching than sending civilians into outer space. In fact, it's quite simple. Your friends and family need money, and you have it. But you want the loan to be recorded and the process automated. That's what this site does.

Virgin Money acquired CircleLending, a company known for facilitating intrafamily loans. The site offers a variety of loan-formalizing products for several types of loans. You pick one along with the lender or borrower (as the case may be); either party can pay the upfront fee and off you go.

All the basic products set up the initial loan documents; you can choose to add loan servicing (transferring money over the Virgin platform to make and receive payments) if you'd like.

Products include mortgages (starting at $649 for a basic loan agreement), a reverse mortgage to help elderly parents stay in their home ($2,499, plus $9 a month), personal loans (starting at $99), and business and student loans (both starting at $199).

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The loan terms -- such as length and interest rate -- are nego­tiable between the parties, except if it's a mortgage. In the case of a mortgage, the rate must be no lower than the minimum applicable federal rate (recently 4.6%), so as not to be considered a gift for tax purposes. Average interest rates are about 6% to 8%, and defaults range from 2% to 5% for all loans.

Online Lending Sites

1. Riskier Return: Prosper.com


2. Safety First: Zopa.com


3. Lend to a Friend: VirginMoneyUS.com


4. What's New? P2P Loans for College


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