Lending Money to Strangers: Good Idea or Bad Idea?
What are you crazy? Why the heck would you loan money to strangers?
It's not an unreasonable question to ask.
However, I'm a very evidenced based person, in other words, it's what has actually happened that counts, rather than what someone thinks might happen (often overly optimistic or overly pessimistic). I've done a bit of research, and uncovered several groups that have made vast fortunes mainly by lending money to strangers.
Here's a partial list:
- Bank of Montreal
- Royal Bank of Canada
- Canadian Imperial Bank of Commerce
- Toronto Dominion Bank
- Bank of Nova Scotia
- HSBC, Santander Group, Barclays, etc.
If you invest in these companies, you are a willing participant in this (prudent) loaning of money to strangers concept. Chances are you've been happy with how it is has turned out.