Borrowing on Zopa

ste_coxy

Hi guys,

I am just curious what the process is with borrowing on Zopa.

My dad has applied for a £5k loan on there - his credit score level was "A" and has been pre approved.

It is now being reviewed by the underwriters and he wants to know what is next - are there forms to fill out, what kind of additional questions will they ask, how long until he is to get the money etc?

Your advice would be much appreciated - I have checked on their website but the answers to my questions have not been answered and I am looking for people who have borrowed previously for their experiences.

samay007

Hi,
could existing borrowers on ZOPA share information with us. i'm also looking for few information on personal loan.
1. what would be the total processing time
2. do we have to send any documents for them
3. through forum, i found that they will request my work place for identity and salary check. if so, what would be the method (Post/ fax)

Thanks

jamesd

Zopa reject something around 80% of applicants who get an initial rate, so your dad shouldn't be surprised if he finds that his application is declined. Or accepted. The underwriters will sometimes ask for no more information. Other times they might ask for bank statements or pay slips. It depends on the exact details of the application.

Total processing time varies but is likely to be between three and ten days, most likely nearer three to five at the moment. It only gets longer when they are really busy or if the post has to be used to send documents back and forth. For work they might phone up and ask for you, giving some harmless reason or more likely none, because switchboard operators don't usually care why people call. They might ask for payslips and/or bank statements if the income seems high for the job.

Declaration of interest: I've both borrowed and lent via Zopa. At present there's no chance that my money will be lent to any applicant.

Gymgenius

jamesd wrote: »

....Declaration of interest: I've both borrowed and lent via Zopa. At present there's no chance that my money will be lent to any applicant.

I've only just discovered Zopa, and was thinking of lending on there.
I'd be very interested to know why you won't be lending to any applicant?!

Please PM if you don't want to say in the forum.

jamesd

Gymgenius, see this discussion of Zopa. I had no money on offer because the rates didn't seem worthwhile, so with no offers it wasn't possible for me to be lending to anyone. There's been a blip of higher matched rates over the weekend but funds on offer have now risen again and it seems unlikely that there will be really good rates around. Still, I have some offers now in case there are some. I expect that more money will hit the markets and make it best to withdraw those in a week or so but it'd be nice to be wrong.

Pay particular attention to the discussion of how bad debt is deducted from after tax income, increasing the allowance you need to make for it unless you aren't a tax payer. All of the calculations that Zopa presents on the lending screens ignore tax, so you end up with an allowance that's too low if you're a tax payer.

There are some nice rates for three and five year fixed term savings accounts available without the risk or hassle of Zopa. It can be hard to get a worthwhile gain over them. Harder still if you compare to things like corporate bond funds, several of which are paying over 8% before tax and can be held in a stocks and shares ISA to eliminate the tax.