What is Peer to Peer Lending and MPactWealth?

Peer to peer lending, or private lending, is a way to make money in a similar way that banks do. But rather than going to a financial institution, the borrower comes to you. You then earn money by way of collecting interest. The return is greater than the interest gained by traditional means, like CDs or savings accounts. It's also a sure return, unlike the volatility of stocks.

That said, there is the risk that the borrower may fail to follow through with payments. However, there are ways to offset this risk and even turn borrower defaults in your favor. More on that below.

Peer to peer lending can become a profitable enterprise. Here's the philosophy behind it:

The Money's in the Bank

There are three kinds of people in this world, according to MPactWealth. They are: consumers, producers, and bankers.

• Consumers earn money to buy things, but often need to borrow from the bank.
• Producers are entrepreneurs. They often borrow from the bank in order to run their businesses. Both consumers and producers have debt, while the
• Bankers make all the money, controls the funds, and have the least risk.

MpactWealth wants you to think like a banker. Instead of looking for ROI (return on investments), you should be looking to value and interest. Bankers thrive on interest.

Bankers also cover themselves. They will put the risk on the borrower. There will be collateral involved, and the loan value will be lower than the collateral. That way, if the borrower defaults, the banker gains.

Bankers also practice re-hypothecation, this is a fancy term for using the borrower's collateral to secure another loan for another deal.

If banks can make money with little risk, why not private lenders?  You just have to make the move out of the consumer mold and think and act like a banker.

Diversify

Although it's important to think and act like a banker, private lending doesn't have to be the only source of your passive income. It can be a valuable addition to your portfolio. Smart earning involves multiple sources of income when possible. While MPactWealth leans on private lending, they suggest that any wealth building based on any assets is good, provided you go about it the correct way.

The mistake is that most people focus on the investments, rather than the METHOD of investing. It's the method that makes the difference. MPactWealth is committed to teaching this.

Peer to peer lending is an investment, but there is a method to it. There are safeguards that must be put in place in order to minimize risk. There is networking involved. There are structures for deals that must be organized.

It can be done in a way that makes it safer than other investments.  Then, as a part of your portfolio, it can provide income for other investment opportunities.

Can You Do Peer to Peer Lending?

According to George Antone, founder of MPactWealth, yes. That's why MPactWealth exists. It's been around for over a decade. They boast the nation's largest network of private lenders. They train and support those who want to become "the bank."

MPactWealth teaches the proven methods that banks use to gain wealth and how you can apply them. They offer home study courses, live training events, tools, and support.

Some of it requires a bit of investment to start with, but they offer a money back guarantee.

Some of it is free! If you would like to learn more about earning money in this way, they actually offer Antone's book, The Banker's Code as a free download. It might be profitable for you to check it out.

Does becoming your own bank sound like a good idea? Leave a comment below!