Yes, a newbie is also eligible to ask for a loan if he is offering good collateral. Please read this brief post by experienced member Vod to learn more about it.
What is considered collateral?Collateral is something that can
easily be resold to cover the loan value plus interest should the loaner default on the loan.
- The best collateral is another crypto-currency, such as Litecoin (also written as LTC). Coins must be moderately traded on multiple exchanges.
- Some digital wares such as domain names can be considered as long as the user cannot recover it.
- Small valuable items that can be shipped though the mail - i.e. gold, silver, iphones, etc.
- Large items, such as a motorcycle or guitar can be used if you live close to the person giving you the loan. Try
localbitcoins.comWhat is not considered collateral?-
Items they want to sell. They don't want it back, so they will default. It's scammy unethical behavior and will lead to negative trust. Check their recent posts!
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Items not in hand. Don't trust a user that promises to give you something *when* they default! Tracking numbers only show something has been mailed - it could be an empty box.
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Future income. You can prove you'll make
xx coins in the next few days, but nothing forces you to send those coins to pay your debt.
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Identification. So what if they can prove who they are. Are you going to spend more money and time taking them to court on untested legal grounds? You'll probably just walk away, like everyone does. ID is useless.
- Games codes or similar. To verify the collateral you need to use the code, which destroys the collateral. Consider this a purchase, not a loan. (Post in
Digital Goods instead)
- Most new alt-coins or alt-coins that trade for satoshis are not good collateral as they can become worthless overnight.
- Paypal should never be used - they are anti-bitcoin and will rule against you 100% of the time. Escrow can't even help, as paypal charge backs can come over 6 months later!
- Most valuable online accounts can easily be recovered by social engineering (the user contacting support to say they were hacked, and regain control of the account) Examples: Steam
When should you use Escrow? -
Never send collateral directly to a low activity/post account offering you a loan, as they are likely to take your coins and disappear. (Collateral Scam) - Use only "Hero Members" or "Legendary Members" for escrow - they have a vested interest in the community with the time they have spent here.
- Do not use a third party escrow service unless hero members can vouch for it - it's too easy to create a website, do a few escrows then disappear with a big balance. Rinse and repeat.
- A list of trusted escrows can be found here:
https://bitcointalk.org/index.php?topic=855778.0 When considering the trustworthiness of a user, ignore "Posts" as there are schemes that pay a user per post. A person can make 1,000 useless posts in one day and contribute nothing to the community. Instead look at the "Activity" number - that gives you a more accurate tally of how involved the user is in the community.
Ignore the sob stories that users post - it's just a scam to get your coins. If a person really is in such a situation, they can turn to family, friends or other social circles they frequent. They are just posting in our community because the payment is anonymous and irreversible.
