Funding Circle

Coeus

Hi all!

Have set up a funding circle account and in the process of moving some funds into the account

Would any existing member's mind posting their experiences/thoughts/opinions of the lending side of the service before I start to lend out? If willing I would be grateful to know what returns people are currently making!

Also opinions on whether the risk and return outweighs that of conventional bank savings would make for interesting reading

Thanks in advance,
Coeus.

PParka

Hi,

I also decided to give Funding Circle a try. Here is my experience so far:

Don't use the autobid funtion unless you really need to. It's better to keep control yourself and bid manually.
A lot of people wait until the last few minutes before putting bid offers in. I get in early and offer a percentage I'd be happy with. (Don't be tempted to go too low just to get your money lent out)
Spread your money across a variety of loans to reduce the risk.
Finally, be prepared to lose some of your money. This is a very new idea so has a high risk associated with it.

Now the good news!
I'm currently lending at rates from 7.9% to 11%. My average lending rate is 9.4%
A couple of my loans are for 12 months, the rest are 36 months.


Hope this helps
Parka

Jonbvn

Similar to the poster above, I too have joined FC. My experience so far is positive. My average lending rate is 9.5%, plus the 2% cash-back equates to a 11.5% return.

My favourite feature is the ability to sell your loans, should you want access to your money. This to me gives it the edge over ZOPA. You can also purchase loans, but this option does not include cash-back.

Due to the risks, this should be seen as equivalent to an investment, and certainly NOT an alternative to a savings account.

ricky.patel89

How much in money in total have you guys put into Funding Circle, I'm now considering the idea but not sure about how much I should put in.

Coeus

Glad to see the interest is running. I'm considering testing the water with £2,500.00 however will probably drip it in until I fully understand the system.

ricky.patel89

So if my understanding is correct, then you as a lender do not completely fund a borrowers loan, you just provide part funding?

Jonbvn

ricky.patel89 wrote: »

How much in money in total have you guys put into Funding Circle, I'm now considering the idea but not sure about how much I should put in.

I have just dipped my toe in the water so far. IMPO, too early to bet your house, wife and kids on this;)

ricky.patel89 wrote: »

So if my understanding is correct, then you as a lender do not completely fund a borrowers loan, you just provide part funding?

Of course. Numerous different lenders only lend a small proportion of each loan. You really need to check out the FC site for further details.

Gorgeous_George

At the moment, FC is flush with lenders and competition to lend is strong (too strong in my opinion).

The cashback makes it a reasonable product at the moment but I fear that when the cashback ends (and once a borrower has defaulted) some lenders will realise that goose was laying brass eggs all along.

Lend by all means but be prepared for bad debt and factor this into your rates.

GG

sabretoothtigger

Selling loans does sound very advanced and flexible. This is the first ive heard of them, are they well advertised because in the end that will help raise demand

Jonbvn

Gorgeous_George wrote: »

The cashback makes it a reasonable product at the moment but I fear that when the cashback ends (and once a borrower has defaulted) some lenders will realise that goose was laying brass eggs all along.

But still better than the plastic eggs at ZOPA, where you are stuck with the loan to term, despite their numerous (hollow) promises to create a secondary market..;)

downs523

what are the fees involved i read its free this year but not next year? anyone know any more?