What % do you put into P2P ?

jamesd

fun4everyone wrote: »

However I prefer to put my money with sites that are honest.

So far as I know SavingStream are completely honest. Are you planning to call a bank dishonest because it lowered its rate on new term deposit accounts while you continue to get the rate you were originally told you'd get on the one you have until it reaches the end of its term? I doubt it and that's all SavingStream is doing.

fun4everyone wrote: »

I am avoiding altogether and will use more realistic honest providers.

Would you think perhaps that Zopa or RateSetter are honest? If so I'll be happy to tell you about them actually being less than honest, in the case of Zopa even breaking regulations, to the point that I'd have perjured myself if I signed a consumer credit licence application that at one time was required to lend the amount I was interested in lending there: I was required to say that I was going to obey the Consumer Credit Act and couldn't honestly do that because I knew that Zopa wasn't complying with it.

fun4everyone wrote: »

Of course in all likelihood I will just miss out on these 12% returns whilst they are available, too much caution probably

Perhaps, though I think it's more about not understanding the investment and that's a good enough reason not to invest. I didn't miss out on Zopa when it was offering 12% and higher rates either but you might have done. They aren't dishonest because they told me the correct rates at the time I was lending at those rates but don't offer those rates now. They did get the default rates significantly below actual rates in 2008 lending, though.

Just so you know what used to be available at Zopa at times, numbers are amounts I lent at those rates in the main Zopa markets that have fully repaid followed by the amount in other loans that are in default, mostly repaying slowly, and the total interest paid on both so far:

19-20%:		 390, 0,	 141.84
18-under 19%:	 250, 130.52,	 143.80
17-under 18%:	 410, 65.45,	 142.70
16-under 17%:	 350, 37.92,	 111.16
15-under 16%:	 430, 24.10,	 112.48
14-under 15%:	 600, 74.66,	 186.89
13-under 14%:	 370, 108.90,	 154.58
12-under 13%:	 670, 52.49,	 162.55
11-under 12%:	 280, 61.85,	 60.94
10-under 11%:	 600, 0,	 104.44
9-under 10%:	 1050, 4.68,	 140.47
7.8-under 9%:	 520, 52.68,	 94.02
lower:	 negligible, 0, negligible

So reading that, I lent at 19% or higher, £250 that has been fully repaid and also have other loans that have defaulted with a current outstanding balance of £130.52. I have received a combined £141.84 of interest on those loans so far.

What you have is doubts apparently based on not understanding business models and lack of knowledge of the places that you probably think are offering sensible rates, but for a different type of lending that inherently has lower rates at the moment.

Meanwhile in a parallel world, Barclaycard just offered to lend me money - a money transfer - at 0% with 2.9% fee until 1 August 2017. That helps to put the rates Zopa and RateSetter are offering to lenders and borrowers now in context: it's way higher cost for the borrower than that card deal.

bigadaj

Well in my opinion all the p2p lenders are beingmuch more honest than hbos or rbs were nearly a decade ago.

I don't foresee any public money being available for any lenders that suffer from default, whether by borrowers or by platforms.

JohnRo

jamesd wrote: »

Meanwhile in a parallel world, Barclaycard just offered to lend me money - a money transfer - at 0% with 2.9% fee until 1 August 2017. That helps to put the rates Zopa and RateSetter are offering to lenders and borrowers now in context: it's way higher cost for the borrower than that card deal.

I'm using Barclaycard credit to leverage some investments for the next 20 months, net cost of credit is zero, using a balance transfer mule and an initial transfer fee that's refunded to the outstanding balance. My only gripe with Barclaycard is the relatively high minimum monthly repayment threshold.

jamesd

I'm doing something pretty similar.

masonic

fun4everyone wrote: »

My point is that that rate of return is unsustainable, as other respected posters did agree with me. Other P2P sites seem far more realistic about long term return and risks. What happens with saving stream and their investors money when this unsustainability catches up with them is unknown. Of course I am probably wrong and 12% is completely sustainable long term via SS. Or even if it isn't the rates will just drop some in the future.

I think others have covered most of the points I would have made, so I will limit myself to stating that when I agreed with you that the 12% rate was unsustainable, I clearly had a very different definition of "unsustainable" in mind.

All I meant was that it won't stay this high forever in my opinion.

The two reasons that it won't (increases in borrower defaults in an economic downturn and increases in lenders willing to accept less than the current rates) will affect P2P as a whole.

I have no idea what you mean by: "What happens with saving stream and their investors money when this unsustainability catches up with them is unknown." You seem to be suggesting that it is unsustainable in the ecological sense (e.g. it is going to run out of funds if it keeps paying out at current rates). If that is really what you are trying to insinuate then I completely disagree.

Kendall80

JohnRo wrote: »

I'm using Barclaycard credit to leverage some investments for the next 20 months, net cost of credit is zero, using a balance transfer mule and an initial transfer fee that's refunded to the outstanding balance. My only gripe with Barclaycard is the relatively high minimum monthly repayment threshold.

I'm doing similar but lower risk. Any balance I use on the cards is safely tucked away in the usual high interest current accounts. A rule I set for myself is I must always have more instant access cash than total CC debt. I'm in P2P but would not use the CCs for that on the off chance things turn bad around the time of 0% expiry.


Barclaycards minimum payment threshold is a little high. I'm paying back £360 a month combined on my 2 cards.

cuthbertlilly

what investments are you going in to with this leveraged CC debt?

bowlhead99

cuthbertlilly wrote: »

what investments are you going in to with this leveraged CC debt?

Not sure who you're addressing, but from the last page of posts Kendall80 is doing high interest current accounts, jamesd is doing p2p, which just leaves JohnRo to declare though he's talked about various holdings on various threads.

I tend to see my low interest CC facilities as being general and not tied to a specific investment. Much as my mortgage is supporting my general lifestyle, cash emergency fund, cash savings, investment portfolio and ability to make pension contributions and so on, rather than solely the residential property asset on which it's secured. If I cashed in the portfolio, emergency and short term and medium term savings, and didn't make pension contributions, I could have a lower mortgage, so in a sense my larger-than-bare-minimum mortgage is supporting all those things.

My cc borrowing supported Pension and ISA and VCT contributions last year across a range of asset classes and sectors. Allowances I wouldn't have got to use to the same extent if I hadn't indulged in the cheap borrowing.

I should have the net income this year to pay it off, but it's interest free for much longer than that having paid the one-off arrangement fee, so I'm unlikely to do so. Depending on market conditions in a couple of tax years' time I may settle it or roll it to support more pension, ISA, VCT etc.

JohnRo

I'll be deploying capital in my income portfolio, the zero cost CC debt just allows me to utilise this years ISA allowance and use other money elsewhere in the mean time. I'll pay back the credit as required from income and cash savings over the term.

It's probably worth mentioning, at no point am I borrowing money I can't pay back immediately should I have to.

adindas

I have put £1001 to Rate setter just to earn 4% + £100 incentive for this

But I am seriouslyconsidering taking more risk if the return is worthy. I think 12% is risk worthtaking especially of the findings is small and diversified among differentplatforms and sector of lending. Also I am already read the more intensive P2P Forumin here.

http://p2pindependentforum.com/

I understand that all of UK P2P lending are FCA regulated so they will be thinking twice to do illegal activity similar to which exist in share trading e.g. inside trading, pump and dumb (In this case pump and defauting ?), etc. ...

1. Just wantto recheck it, is there any link to FCA or similar about the list of platformswhich are FCA regulated which one is not.

2. I am just comparing this with ISA S&S option for passive investor such as puttingmoney in a fund low fee platform might produce already return of about 10%.

3. I have seen alot people in MSE are lending and defaulting. I Could imagine that if these peoplegot to P2P lending and get it. You will loose your hard earning cash. What due diligence have been conducted by the platforms to prevent this tohappen ?. In case of defaulting how diligent they are to chase the matter torecover the money. Are they chasing them the the court, using debt collectors,etc. ??

I understand thatputting money in Fund of Fund is more secure than P2P (?) as it is worldwide. Indexed??

Why peoplewould people want to put money on P2P instead in put it in I funds?

4. I understand people might want to do this because they will need access in the near future.

People might want to diversify. But I fail to understand for about 2% margin compare to return from investing in fund, why would people want to invest in P2P lending which is riskier??

Thank you fory our time