ZOPA - Anyone tried this

stevetodd

Jake'sGran wrote: »

I am convinced people don't understand regular savings accounts. There was yet another complaint in Times Money a few weeks ago from a lady who thought she would be getting the headline rate! There are a few banks/bldg societies doing 7%+ fixed on bonds for one year - Kapthing Edge is one.

I'm not sure what you mean? I am expecting to get the headline 10% rate but obviously only for money that I have in the account. For example I will be saving £2,000 per month and I expect to earn 10% (pa) on my money when it is in the account. If you mean that overall I would have deposited £24,000 and I will not receive £2,400 interest, of course I will not because I did not have £24,000 in the account for a whole year, it would be ridicleous to expect that.

Jonbvn

rarrarrar wrote: »

What default rate have you had ?

I have one (1) borrower who is late paying on a loan of £20. Although not officially a default, I think it will be soon.
Therefore my default rate is 20/10000*100 = 0.2%

From what I understand, this is lower than average, but not exceptionally so. I think such low default rates can be attributed to ZOPA undertaking stringent checks on borrowers (e.g. they call up employers!).

Not sure if the personal angle of lending/borrowing has a bearing on keeping defaults low. Depends on circumstances I guess.

Jonbvn

stevetodd wrote: »

I'm not sure what you mean? I am expecting to get the headline 10% rate but obviously only for money that I have in the account. For example I will be saving £2,000 per month and I expect to earn 10% (pa) on my money when it is in the account. If you mean that overall I would have deposited £24,000 and I will not receive £2,400 interest, of course I will not because I did not have £24,000 in the account for a whole year, it would be ridicleous to expect that.

There have been numerous posters on this board who have also misunderstood, similar to the letter in the Times. Therefore, it is reasonable to assume that this is a common misconception.

mouche

I have lent out a total of £50 in Zopa as a test. I have 4 borrowers (one was a listings borrower). While that is a very small amount in comparison to most people, in the past two months I have had late payments on £30 of that amount. So a 60% late payment rate. The first repayments on the remaining £20 is not yet due so god knows what will happen there! I hope I will get at least some of it back but it has made me wary of investing more.

Blah99

Search this specific forum for posts titled "Zopa", there was a huge multi-page discussion about it last year.

sabretoothtigger

Investing 50 was too little. Thats like spending 50 on shares and paying 12.50 in commission.

Lending a tenner per person on 10k overall is spreading the risk, you did the opposite unfortunately so your conclusion is likely wrong also

You need lots of money to make more and the more you have, the easier it gets. Sorry the world is really that unfair

stevetodd

Jonbvn wrote: »

There have been numerous posters on this board who have also misunderstood, similar to the letter in the Times. Therefore, it is reasonable to assume that this is a common misconception.

Yes common amongst the village idiots, it's not rocket science is it?

rl290

There are several previous posts about Zopa, including one from just a few days ago. I suggest that you follow previous advice and search for these, as there have been long discussions about risk/return etc...

FYI, I have £2k lent out at about 10%

R

LRW1975

I've had a Zopa loan since last November.

Fab service and i managed to get a rate that was much lower than going via the usual bank route.

Lisa x

mouche

sabretoothtigger wrote: »

You need lots of money to make more and the more you have, the easier it gets. Sorry the world is really that unfair

Hehe...I have the money - just not the risk taking temperament. Having said which, I see your point and I'll probaby keep trying with Zopa, even if it's a small amount. Since it's small, it's play money for me and eventually it may build up into a bigger sum.