Peer-to-peer lending sites: MSE guide discussion

Davina40

There's not been a lot of discussion about Zopa on here, just wondering what people think of it?

The rates aren't great compared to others but it's got a long track record and surely the platform risk has to be the lowest of any p2p.

firestone

Davina40 wrote: »

There's not been a lot of discussion about Zopa on here, just wondering what people think of it?

The rates aren't great compared to others but it's got a long track record and surely the platform risk has to be the lowest of any p2p.

would be interesting to know which platform has the lowest risk according to what i have read before only about 3 companies are in profit with a couple getting closer.
I would think Zopa comperes to Ratesetter in size and risk
Funding circle seems to be the one growing fastest in terms of recognition via advertising in the main stream and with an upcoming stock market flotation
Lendy was the first i believe to claim to be in profit but would be considered high risk in loans
Two of the strongest platforms maybe Landbay with funding from the likes of Zoopla and
Octopus choice (hopefully as i went with them!) who have a large parent company and were in loans already and have other financial products
There is also a site called 4thway which attempts to give a risk level to P2P platforms

AdrianC

firestone wrote: »

would be interesting to know which platform has the lowest risk

Platform risk? Don't forget that all FCA authorised platforms have to have failure plans in place.
Loan risk? Very different thing.

according to what i have read before only about 3 companies are in profit

Lender risk is not the same as platform profitability.

firestone

AdrianC wrote: »

Platform risk? Don't forget that all FCA authorised platforms have to have failure plans in place.
Loan risk? Very different thing.



Lender risk is not the same as platform profitability.

Would tend to agree both points that platforms have failure plans in place & that the loan books of Zopa etc may even look attractive to mainstream lenders to take over if in trouble and that you should look at loan risk as well.
But at some point platforms will have to move from a start up stage and make an operating profit.Also while they have plans in place you only have to see the worries that Collateral caused for a few days and is still ongoing in some peoples minds to see that the stronger platforms will appeal more to the mainstream market and grow into a profitable business.Any time a company has to use its recovery plan people will focus on what went wrong not how well it was handled even if that is the case

TheShape

takesyourchances wrote: »

I have sold down MT best I can so far, rest is for sale and waiting to run down. Still at £2300, I will still be at over £600 of that in defaults even with this recovery at say 90%, But it is a start, one point it was my highest holding and it peaked over £5000.

Hopefully the secondary market moves if some more money is returned otherwise will just wait it out. I am withdrawing any money that comes in at the moment.

Are you still looking to reduce fully out of P2P?

I am trying to make things more simple with what I am prepared to keep in P2P. To run MT down would be one of them and would put some returned over to Lending Works etc.

Pretty much running p2p down to zero although that will take a significant amount of time.

MT loans will take time to sell/recover defaults, Unbolted loans will take at least 5 months to all become due, Lending Works loans are running for up to five years and I'll just let those repay.

Everything depends on what, if anything, is returned from Collateral. Safer to plan for a worst case scenario as there is always the chance of being tied up in loans for a significant period of time.

AdrianC

firestone wrote: »

Also while they have plans in place you only have to see the worries that Collateral caused for a few days and is still ongoing in some peoples minds

The wind-up of Collateral will be interesting to follow. Fortunately, we're not too heavily invested, if recoveries don't follow.

Any time a company has to use its recovery plan people will focus on what went wrong not how well it was handled even if that is the case

The Collateral closure is starting to look ever odder. It now looks as if the interim permission they'd been operating under was transferred to them by the FCA from another company (which isn't permitted...) - and their closure was precipitated by that permission being transferred back by the FCA, even though the original holder was dissolved in the intervening period.


I'm not one to join in the usual FCA-bashing, but something appears to have been dropped here...


Interesting times...

Fatbritabroad

Just out of interest why lending works over ratesetter? The 5 year rates arent dissimilar looking at them

takesyourchances

Fatbritabroad wrote: »

Just out of interest why lending works over ratesetter? The 5 year rates arent dissimilar looking at them

Lending Works has insurance as well as a provision fund for an added layer against defaults. Ratesetter does not have this insurance. As far as I can gather Lending Works are the only P2P company with this protective insurance in place if I am correct.

Their rate on 5 year is higher now at 6% for the moment, for me it is more stable to know the rate, I found Ratestters rate changing alot which was annoying when re-investing and it was trying to catch it at a higher percentage.

fun4everyone

Growth Street are offering a 2% bonus on new deposits put out on loan over a year. You must already have a Growth Street account on the 27th March 2018 to qualify.

Increase your investment by:
£2,500 -£4,999.99
£5,000 - £9,999.99
£10,000 -£24,999.99
£25,000 -£49,999.99
£50,000+

To earn a bonus of:
£50
£100
£200
£500
£1,000

The current rate on their is 5.3% so this makes 7.3% over a year. Not great but better than the similar Funding Circle imo. The bonus is only worth 2% if you put the minimum in for each qualifying tier.

I am reading they also now have been granted full authorisation with the FCA.

https://www.growthstreet.co.uk/spring-2018-investor-bonus

firestone

takesyourchances wrote: »

Lending Works has insurance as well as a provision fund for an added layer against defaults. Ratesetter does not have this insurance. As far as I can gather Lending Works are the only P2P company with this protective insurance in place if I am correct.

Their rate on 5 year is higher now at 6% for the moment, for me it is more stable to know the rate, I found Ratestters rate changing alot which was annoying when re-investing and it was trying to catch it at a higher percentage.

Also with Lending works each time your money gets deposited if you set auto reinvest then your repayments are always at the front of the queue