How much have you made on P2P Lending sites?

corum_uk67

I joined funding circle over a year ago and my experience has been mixed.

My review on Trustpilot (that bastion of impartiality, not), can be found here:

https://www.trustpilot.com/reviews/56e194320000ff0009446402

Maceo

bigadaj wrote: »

Useful post. I've only just started getting into p2p over the last few months and have a few thousand invested but will be increasing this over the coming months and probably years.
I've deliberately avoided Zopa, and have enough in rate setter just to get their bonus. These platforms seem to be all unsecured lending, rates barely above those on current accounts and regular savers, with no clarity over the loans being undertaken.

I'm sticking with Moneything, Savingstream, Ablrate etc which are secured and give 12% ish.

Have you had any defaults as yet?

I think Zopa is actually pretty sound as they are one of the few P2P sites that have lived through a recession and proven to still give investors a positive return during that volatile period. So there is some indication they do risk assess their borrowers quite rigorously and don't give it out to any tom !!!! or harry.

I lost about £50 on Zopa for loans not covered by their safeguard scheme, however the bonuses I have received from them has covered those losses.

I have lost about £70 on Funding Circle but still getting a 5.5% return on my investment so in real terms have not lost out.

Ratesetter I have lost zero money.

I think once P2P ISAs finally arrive they will offer a good alternative to traditional stocks and share ISAs.

Maceo

corum_uk67 wrote: »

I joined funding circle over a year ago and my experience has been mixed.

Agree I am being cautious with Funding Circle at the moment. I have fully diversified over 300 loans and just going to monitor it over the next year or so to see how well it does before putting any more money into it.

Maceo

2010 wrote: »

The last sentence seems very reassuring.
So you can lose all your money then?

Now interest rates are so low it`s not worth saving (after current accounts), I can see a whole lot of gullible people going down this P2P route and getting their fingers badly burnt.

A distaster waiting to happen, 12% is not sustainable.

Agree 12% is unusually high and I would question that rate and who they are lending to. But as for P2P lending in general its no more risky than putting it into stocks and shares which can go up or down. Its a healthy option for any diversified investment portfolio.

jnm21

Maceo wrote: »

I lost about £50 on Zopa for loans not covered by their safeguard scheme, however the bonuses I have received from them has covered those losses.

Can I ask more detail on this please (sorry in advance for all the questions)? I presume that this is Zopa plus? When you say bonuses, I presume you mean RAF bonuses? If you exclude bonues such as RAF (i.e. capital & interest only), what rate of return would you say you are getting from Zopa Plus?

Many thanks in advance. :beer:

bigadaj

Maceo wrote: »

I think Zopa is actually pretty sound as they are one of the few P2P sites that have lived through a recession and proven to still give investors a positive return during that volatile period. So there is some indication they do risk assess their borrowers quite rigorously and don't give it out to any tom !!!! or harry.

I lost about £50 on Zopa for loans not covered by their safeguard scheme, however the bonuses I have received from them has covered those losses.

I have lost about £70 on Funding Circle but still getting a 5.5% return on my investment so in real terms have not lost out.

Ratesetter I have lost zero money.

I think once P2P ISAs finally arrive they will offer a good alternative to traditional stocks and share ISAs.

Interesting, I think with Zopa it's more the case that their spread is sufficiently great that they can absorb any losses and defaults, ie they are keeping most of the borrowers interest and fees.

People seem oddly reassured by not very high rates, when in reality the risk taken on by lending to individuals or small businesses, whether secured or not, requires a higher level of return.

I currently use Savingstream, money thing and Ablrate, generally offering 10-14% on secured loans, mainly property but other assets as well. Each loan is separate and lent directly, rather than via the platform, so there is clarity and you can make your own decisions on who to lend to and how much. Deal flow can be slow, but there are generally secondary markets if you feel so inclined, and it can take time to diversify sufficiently to reduce overall risk levels on the invested sums but I like the concept, still have a very small amount invested which I'll slowly increase depending on deals, returns and defaults.

I can't see the point in lending blindly with unknown risks and getting even 5-6%, just not worthwhile in my opinion, and we know that many rates at Zopa and rate setter are at 3% or below.

jnm21

bigadaj wrote: »

I can't see the point in lending blindly with unknown risks and getting even 5-6%, just not worthwhile in my opinion, and we know that many rates at Zopa and rate setter are at 3% or below.

I agree that some of the rates I have seen on ratesetter are insulting, but at 6% with the (limited) security offered by the provision fund (and ultimate diversification offered by a resolution event if the provision fund ran dry), I am happy to try it out with a relatively small amount. Add in the welcome bonus making that 15%+ over the first year! :j

I note that the 3 you mention are not members of P2PFA, which would make me a little more nervy & certainly demand a higher return. You are however correct that I am probably silly to imply that a 12% rate must be risky (the old if it looks too good to be true...)!

Superscrooge

After months of sitting on my hands wondering whether P2P was worth the risk. I was finally tempted to invest £1,000 in P2P by the below article explaining how to get a 14% return from Ratesetter.

http://monevator.com/ratesetter-high-interest-offer/

nushnush

i lend through ablrate, moneything, savingstream, assetz capital and collateral, i get between 10% and 12% from all but assetz, i average about 8.5% from assetz, so far no defaults at all but only been using P2P for about 9 months. i would expect some defaults at some time but wouldnt expect to lose the full amount in the default and even if i did my spread of loans would still leave me in positive territory.
highest amount in SS then AC then MT then Collateral and last ablrate. nothing against ablrate but the deal flow has been very low for sometime now.

bigadaj

jnm21 wrote: »

I agree that some of the rates I have seen on ratesetter are insulting, but at 6% with the (limited) security offered by the provision fund (and ultimate diversification offered by a resolution event if the provision fund ran dry), I am happy to try it out with a relatively small amount. Add in the welcome bonus making that 15%+ over the first year! :j

I note that the 3 you mention are not members of P2PFA, which would make me a little more nervy & certainly demand a higher return. You are however correct that I am probably silly to imply that a 12% rate must be risky (the old if it looks too good to be true...)!

I've got a grand in rate setter just for the bonus, it'll all probably come out early next year when the year is up.

The platforms are all regulated, and none have fscs guarantees, though as you say the majority of the larger platforms are in p2pfa.

However I like the transparency, relatively speaking, of the three I quote, though Savingstream has received some criticism.

No guarantees and Ablrate appear to have had their first default, just trying to locate their security now I understand !

It's a case of being reasonable as far as having your cake and eating it I suppose, spreading risk across platforms and borrowers is key, and each loan proposition is explained, detailed and the valuations justified, meaning that it's easy to ignore those you dint trust or don't seem attractive.

Deal flow can be a problem and some of the loans get filled very quickly, whether this means people aren't doing their due diligence or it might lead to a drop in rates in months and years to come well just have to see.