Corporate bonds

Wookster

Sometime ago I heard on the Today program about a novel new company. They arrange loans to companies - the consumer invests an amount with them which they then break up into chunks, which pooled with other chunks of cash is lent to companies at varying interest rates.

I didn't get the name of the company though - anyone know who they are?

Lokolo

There are corporate bond funds? Loads of fund managers do them....

Wookster

This was a company which was open to the public, which means one doesn't have to pay the rather high fund management charges.

SpinnerB

Do you mean www.zopa.com ...

Zopa is a marketplace where people lend and borrow money to and from each other, sidestepping the banks.

Wookster

Yup I think thats the one.

Has anyone used them? What's your experience been?

Lokolo

They don't arrange loans to companies but to other people.

Wookster

Lokolo wrote: »

They don't arrange loans to companies but to other people.

I recalled that they did but obviously not.

sdooley

I have used them on a modest scale. Good returns and no bad debts to date but the worry is that they will all come at once. Zopa currently reports very low rates of bad debt but that may be because most of the loans on there are still in their first year or two (they offer 3 and 5 year loans).

Do it for fun, with money you can afford to lose (and don't need to tap).

Wookster

sdooley wrote: »

I have used them on a modest scale. Good returns and no bad debts to date but the worry is that they will all come at once.

Thanks for that - just out of curiosity, what sort of returns have you got (in practise) off Zopa?

Yeah bad debts will be a bit like that won't they! Nothing for age then the thunderstorm.

SpinnerB

I too have a small amount on lone with them, I've had a couple of late payers so far, but you let zopa chase them for you, been a member for coming up to a year and made about 10% - helped by the refer a friend offer, ended 12/08, you might want to ask them if they are doing it in 2009 as you would have got £50 last year (as would I ) if I refered you and you lent out £2000

Wookster

SpinnerB wrote: »

I too have a small amount on lone with them, I've had a couple of late payers so far, but you let zopa chase them for you, been a member for coming up to a year and made about 10% - helped by the refer a friend offer, ended 12/08, you might want to ask them if they are doing it in 2009 as you would have got £50 last year (as would I ) if I refered you and you lent out £2000

Thanks - I shall definitely bear that in mind.