Lending at Zopa.com

Jonbvn

I have only seen Zopa mentioned in passing on this forum.

I was considering putting in some spare cash say 500pcm (as a lender). Any thoughts? Would a good regular saver be better?

Any experience or info regarding zopa would be gratefully received.

TIA.

amcluesent

>I have only seen Zopa mentioned in passing on this forum.<

There's at at least one lengthy thread and Martin has discussed the pros and cons.

I'm getting an average gross return on 7.6% on lending, mostly on the A24 market with a bit on C12 and C24.

I see that all my lending is for home improvement or a car - I'd be wary about Zopa controlling bad/aged debt with these loans if the economy goes pear-shaped:eek:

spalding

If you search the refferal board there is money on offer for opening an account or adds towards you return

BornSloppy

It's a nice idea but what happens if most people don't pay the loans back? I've leant money to sister and boyfriend but it irritates when they take ages to pay it back.Whether I need the money isn't the point! What are the safeguards?

Jonbvn

amcluesent wrote: »

>I have only seen Zopa mentioned in passing on this forum.<

There's at at least one lengthy thread and Martin has discussed the pros and cons.

Thank you for the feedback. The only articles I can find about Zopa is regarding borrowing not lending. Could you provide a link to the thread you mentioned pleeeease.

Ted_Bloke

Just use the search function without limiting it to lending and you will find about 20 threads.
I hesitate to be responsible for recommending anything so unprecedented. For me it has done what it says it does. I split my loans into small amounts, I have not had a single default but I would not put a major fraction of my wealth that I cannot afford to lose there.
The general increase in rates at the moment (so improved rates elswhere) but the risk of economic downturn causing defaults is an argument for prudence.
If you go there start with a small or moderate amount as it will take a time to get a feel of where to pitch offers and to master the complications of the site and process.
There are some solid borrowers apparently you can lend to at a lowish rate but get a bonus for it.
One way it differs from other savings is that you see your capital being paid back from the start - then you have to decide whether you want to relend it.

Jonbvn

I have put GBP500 in to "suck it and see" so to speak. Deciding which markets to lend in at what rates is very interesting.

I do notice some people lending at rates below the holding a/c rate (currently 4.75%). Why would they do that?

Paul_Herring

Jonbvn wrote: »

I do notice some people lending at rates below the holding a/c rate (currently 4.75%). Why would they do that?

There are various theories, all discussed on Zopa's message boards - top and bottom of it is no-one knows; not even the staff who've contacted the lenders to make sure they haven't made a mistake.

Innys

Paul_Herring wrote: »

There are various theories, all discussed on Zopa's message boards - top and bottom of it is no-one knows; not even the staff who've contacted the lenders to make sure they haven't made a mistake.

I can think of two options, both fairly unlikely, but possible:

1) Lenders are rich philanthropists;

2) Lenders are money launderers.

Money launderers invariably make decisions which are not economically sensible, purely so they can "wash" their ill gotten gains.

Jonbvn

Innys wrote: »

I can think of two options, both fairly unlikely, but possible:

1) Lenders are rich philanthropists;

2) Lenders are money launderers.

Money launderers invariably make decisions which are not economically sensible, purely so they can "wash" their ill gotten gains.

LOL!

I don't see that it would be possible that they are money laundering, since you cannot pay cash into a ZOPA account.

BornSloppy

Maybe they're just kind? Stupid? Or hate banks. I'd have to meet the person before lending money. Decorating your house is hardly important