I almost borrowed from Zopa. After an hour filling in the "about you" or whatever they are called pages I gave up. They e-mailed me a few days later and I replied that I could not be arsed providing such personal information to get a slightly lower rate than a "mainstream" lender. They wanted to know some fairly personal stuff in order that "lenders" could make a decision. they have continued to e-mail me since despite me telling them I was not interetsed. All a bit "right on" and upper middle class for me, people basing their personal decisions on their opinion of me and my values. I'd much rather not bother, and went to a "traditional" lender who was only interested if I could pay - and was only £15 more expensive over 2 years.
surely they have their own way of evaluating credit worthiness or use credit reference agencies, rather than just leaving it up to the lender themselves to decide? or is that the whole principle, they leave it to the lender to decide ?
And presumably it's a legally binding contract?
From what I can work out they have different levels of risk that offer a differing level of return.
The site rate the people and you invest x amount with zopa and they will spread your money around to offset as much risk as possible.
It seemed that people who can't get credit elsewhere and are more likely to default and become in the higher risk category.
I also think there is a fededback system like ebay for people that have taken loans in the past.
Your money is not loaned out to one individual but to several at a time.