Insurance claims adjuster Sehnaz Karsatar came to the U.S. 23 years ago from turkey. She dreamed of a store stocked full of Turkish food.
"I want convince of having my products close to me, where I can just like, as easily as stopping at safeway stop at a store and buy my products and go home. That's my what I would like to do," said Karsatar.
She got tired of driving miles to buy Turkish groceries and waiting for deliveries off the Internet. Ironically, the internet would give her the money she needed.
Sehnaz is one of a growing number of people turning to peer-to-peer lending Web sites for money. They are Virtual banks that give average people loans to other people for school, for debt consolidation, for small businesses, for really anything.
Sehnaz found www.lendingclub.com and within days, she had a loan for $24,000, funded by a group of strangers.
"It was total 98 people who financed my loan," said Karsatar.
Those lenders each assume a percentage of the loan, and are paid back the money with interest. The higher the risk the higher the interest rate. They are investing in thousands of loans just like Shenaz's.
"We are at about 12 percent and in the same period of time, I believe the stock market has lost 40 percent so we've been very happy," said Lending Club lender Eric Di Benedetto.
LendingClub is based in Silicon Valley. It's one of a number of peer-to-peer lending sites that have popped up in the last three years.
"I've only been doing it for about a year now," said Prosper lender Grant Davidson.
Davidson has a stake in hundreds of loans through another peer-to-peer lender called Prosper.
"I have over 400 loans, so my risk, I feel is spread pretty well and I've only had two defaults in the year I've been doing it," said Davidson.
He says those defaults have taught him valuable lessons.
"I think that the most important thing is to look at the numbers. It's easy to be persuaded by people's stories and also the fact that you can interact with people, so you can ask questions and if they good answers, it makes you feel a lot of confidence," said Davidson.
"It's actually the way lending used to take place before big banks got into the picture," said LendingClub CEO Renaud Laplanche. "Both lenders and borrowers get better rates."
Chris Larsen is CEO and Chairman of Prosper.
"We're basically trying to be, sort of an e-bay for money," said Larsen.
At first, the loans were often last ditch efforts for quick cash. Now Prosper gets more mainstream requests.
"These are the customers that the banks a couple years ago were fighting over, because they were really profitable. Those people are now stranded," said Larsen.
According to the Online Banking Report, peer-to-peer lenders were on pace to broker some $150 million in loans this year -- up 50 percent from last year.
"We are now seeing a pretty major shift in very credit worthy people coming to Prosper as the banks are continuing to cut back," said Larsen.
But the Securities and Exchange Commission is clamping down on peer-to-peer lending sites.
The SEC recently surprised LendingClub by requiring them to register as a seller of securities. That led to months of delays, but the company recently came back online.
San Francisco-based prosper.com is now undergoing a similar review.
"The country needs something like this now," said Larsen.
Sehnaz agrees and she's thrilled other people were willing to take a chance on her dream.
"The money part was serious, the processing was so casual I couldn't believe it. It was easier than applying for a credit card I think," said Karsatar.
Not all the news has been good for peer-to-peer lending sites. Last month, London-based Zopa stopped doing business in the United States, citing: ''extremely difficult consumer credit circumstances."
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Written and produced by Ken Miguel.
