Peer-to-peer lending sites: MSE guide discussion

AdrianC

Nardge wrote: »

...the claims currently made against Lendy could have been made against any P2P lender, this is an industry battle not a Lendy one.”

I'm not even sure it's particularly P2P-specific. ANY syndicated lending could have the same issue.

At the end of the day, it's a loon who's happier to lob baseless, vexatious lawsuits about than to repay the money they borrowed. Yes, perhaps the DD should have been better, and they should never have been allowed the loan in the first place. That's a separate question.

itwasntme001 wrote: »

Ive been "investing" in P2P for over 2 years now. From my experience it simply has not been worth it as the returns have not been worth it for the risk taken.

While I've been lending through P2P for over four years, and am currently sitting at XIRR of 6.2%.


Lendy is sitting at XIRR of 11% for me, and even if not one single penny of any of my outstanding duff loans is returned, I'll still be in profit with them (albeit not much). If they go according to my recoveries from duff loans to date, and no better, then I'll be looking around 5% XIRR.

itwasntme001

AdrianC wrote: »

I'm not even sure it's particularly P2P-specific. ANY syndicated lending could have the same issue.

At the end of the day, it's a loon who's happier to lob baseless, vexatious lawsuits about than to repay the money they borrowed. Yes, perhaps the DD should have been better, and they should never have been allowed the loan in the first place. That's a separate question.


While I've been lending through P2P for over four years, and am currently sitting at XIRR of 6.2%.


Lendy is sitting at XIRR of 11% for me, and even if not one single penny of any of my outstanding duff loans is returned, I'll still be in profit with them (albeit not much). If they go according to my recoveries from duff loans to date, and no better, then I'll be looking around 5% XIRR.

You are confirming exactly what i have been saying. You invested for over 4 years. I have been investing in P2P for over 2 years. My XIRR does not come close to yours, its more like 3-4%. A difference in investing time span of around 2 years only, suggesting net returns have certainly fallen over the years. Now of course you could have invested in different platforms and with different amounts to me which would also explain the difference, but i am assuming you have similar risk tolerance and return expectations to me thus our decisions in which platforms and how much to invest would be similar.

Albermarle

I have been investing in 'medium risk' P2P for 2.5 years . Three different sites , one consumer loans; one SME loans and one asset backed property loans ( not Lendy or Collateral).
So far on average have made a return of 7% , not including introductory bonuses and including a couple of losses. There are a couple of duds in the pipeline so maybe 6% it will be in the end .
Unless there is a big recession then will probably be lucky if it is zero rather than negative.

masonic

itwasntme001 wrote: »

You are confirming exactly what i have been saying. You invested for over 4 years. I have been investing in P2P for over 2 years. My XIRR does not come close to yours, its more like 3-4%. A difference in investing time span of around 2 years only, suggesting net returns have certainly fallen over the years. Now of course you could have invested in different platforms and with different amounts to me which would also explain the difference, but i am assuming you have similar risk tolerance and return expectations to me thus our decisions in which platforms and how much to invest would be similar.

I don't know how you can even measure over such a short period as 2 years. Are you counting all of your defaulted loans as 100% losses?

AdrianC

itwasntme001 wrote: »

You are confirming exactly what i have been saying. You invested for over 4 years.

Not in SS/Ly. Only just over three years with them.


My initial P2P exploits were with Funding Circle... Ah, yes. FC... Glad I got clear of that sorry mess.

Nardge

As for me previously I was making do with MSE's Bank Saving Loophole
(passing money around banks at the start of each month to cream off the interest),
5% + Regular Savers, and Cash ISAs. Nowadays, all the rates have sadly plummeted...

It had always been my intention to get into p2p and S&S, once I'd had the time to digest these.
The advent of p2p ISAs together with MSE making out that p2p was a medium-risk investment,
and thus less risky than S&S; both made me head into p2p first.

People have reiterated S&S are the better option, provided you leave the money in long-term.
S&S is my next port-of-call, and I will be moving p2p funds into that, as that seems advised.

In general, are most investors slowly but surely leaving p2p altogether?

My main concern are the consequences of Brexit on p2p from March, if Brexit manifests.
The UK economy might disintegrate, with escalating p2p loan defaults and platform failures.

I'm curious if people here are aiming to pull out their funds by March, or will watch and wait?

masonic

Nardge wrote: »

People have reiterated S&S are the better option, provided you leave the money in long-term.
S&S is my next port-of-call, and I will be moving p2p funds into that, as that seems advised.

It's not either/or. Very few people can stomach being 100% in equities, even if they can stay invested long enough. For those people who want to hold other asset classes, they have the choice between conventional bonds (which have some quite unusual risks off the back of QE), property, gold, cash and now P2P. A sensible strategy will utilise a few of these.

In general, are most investors slowly but surely leaving p2p altogether?

I've pulled some money out of P2P and used it to invest in S&S following the recent correction. Other than that, all of the money I've been pulling out of P2P in one platform has been reinvested in other platforms. I don't intend to make any significant reduction to P2P in percentage terms, though my P2P allocation peaked at a little over 15% some time ago and is now somewhat less than that.

My main concern are the consequences of Brexit on p2p from March, if Brexit manifests.
The UK economy might disintegrate, with escalating p2p loan defaults and platform failures.

I'm curious if people here are aiming to pull out their funds by March, or will watch and wait?

We're also overdue a major stockmarket crash and/or property crash. Rising interest rates may drive down the value of bond funds. Inflation may erode the value of cash savings.

Many things may or may not happen in the next 6 months.

Malthusian

6.6% over four years is not great considering the world stockmarket is up 12.6%pa over that time, with the UK Smaller Companies sector (for a slightly closer comparison) lagging that slightly at 11.7%. And yes, it's comparable. Capital at risk investment is capital at risk investment.

Naturally this is in a bull market, but there can't be many people who are still optimistic enough to think that a crash will treat P2P better than it does listed equities.

stehouk

I'm curious if people here are aiming to pull out their funds by March, or will watch and wait?

Personally i would do what suits your'e circumstances best and not follow the crowd, i started in p2p 3yrs ago and i have done very well, i soon realised the more i read on p2p forums the more uneasy i became so although i used them initially to gain advice i stopped afterwards because there is a lot of shall we say scaremongering going on, yes some people have had bad experiences on certain platforms but equally many have had good experiences but you will only see the bad experiences discussed.
There are some very good sites where you can use to gain factual and impartial information, i now use them instead of the p2p forums.

Goudy

I'm curious to know which "may" be hit the worse with Brexit?

P2P investors lending to local small and medium business and personal loans.
Or
Our national stock market made up of companies that trade internationally and global stock markets that require currency exchanges.