zopa.co.uk - internet money lending exchange

Yes, I've had a good look this morning.

You ought to visit some of the debt sites, including Debt Free Wannabe on MSE. These are unsecured personal loans, so there's the chance of default by the borrower. Zopa says, don't worry we pass it on to debt collectors. What they don't tell you is that no-one can extract blood from a stone So if the borrower finds themselves in dire straights e.g. redundancy, illness, death leaving no assets .... then you don't get your money back.

Of course, the debt collectors may issue a CCJ, but it's cost prohibitive for small loans. And then, if the lender can only afford to repay £1 a month, then the Court may agree that the repayments should be lowered to £1 a month. Quite how you get your money back, if £1 has to be spread around 20 Zopa lenders is a mystery.

So, no - it's less secure than your ING account. But I imagine the interest is more ... as ever, more risk is generally offset by (potentially) more reward ... only potentially though.

However, the most worrying thing for me, is the sheer lack of detail on what happens if borrowers default. That, alone, made me nervous. It's like ... they're trying to hard something.

Cheers

it seems like betfair but without the betting !, i dont think it will take off and it just seems like a good place to get swindled although i havent tried it myself. there was an article about it in the business sunday times supplement but i wish the guy all the best of luck with his business i just hope too many people dont loose out

Martin

If you make contact, can you put my points to them please?

I reckon they would be unlikely to go for a CCJ - I can't see the individual lenders funding this and I'll bet that Zopa won't be prepared to fund it either.

And that, for me, is simply too big a risk. You maybe know that I think I'm pretty clued up on Debt Management issues, so I know that if the borrower defaults, there's very little that can be done to enforce payment.

You might also want to let them know that their lack of transparency on this issue does nothing for their credibility.

Yes .... looks pants!

MSE_Martin wrote:

I've been asked questions about this all day from journalists. Yet i can't get in touch with the company. As far as i'm concerned its pants.

Tut Tut Martin ..... and there's whats-his-name Shankleman on the Johnny Walker show talking to the people of Zopa...... call yourself a journalist!!!;)

Ah yes .... so whilst you might not lose all your money, you could lose a sizeable chunk as the debt collectors generally pay about 20% of the outstanding loan.

Great .. ... not!