Peer-to-peer lending sites: MSE guide discussion

I do not remember exactly why I was not keen in options with safeguard fund, probably because rates are ridiculously low on those.
After reading more I quickly taken 2 000 out of FC and placed 1000 in moneything and 1000 in ablrate. On FC I switched autobid off. Then added another 1000 split amongst FC, moneything and ablrate resulting in about 1300 on each platform. Entertaining myself with manually selecting loans on those platforms placing dribs of £20 at a time . If all goes well I will place another couple of thousands in those platforms plus collateral and FS if I find trustworthy loans on the latter.

nushnush wrote: »

i do wish you wouldn't defend P2P so well, i am finding it hard enough as it is to stay fully invested in the loans that i like

I occasionally think P2P is something that I should get involved with, but I am very wary, what I fear is not risks from a day to day basis, but what happens when there is a huge economic collapse (like 2008 and 1988). Sure, share prices and property collapsed back then, but they eventually recovered, wouldn't P2P investments just end up being totally lost in such an extreme economic meltdown?

On the other hand both jamesd and bigadaj not only put up very reasonable arguments, they are also respected posters with a history of common sense. I think my problem is that I am at a strange (to me) stage of my investing life. I have made my money, and I am 60 next year, and I must admit that I am struggling a little moving from investing for profit, to investing for safety. We've just sold 2 (of 8) investment properties, it was the right thing to do, but part of me still feels like a mug when I look at the prospective lower returns on the equity released.

jamesd wrote: »

If you have disposals (sales or repayments) of loans that aren't exempt you have to report all transaction in non-exempt loans and other investments to HMRC even if no CGT is due because you're within the allowance.

I was under the impression you only needed to make a declaration to HMRC if you had a liability. I have previously placed share trades outside of a tax free wrapped and made a few hundred pounds here and there, but never reported the transactions to HMRC.

chucknorris wrote: »

I appreciate what you are saying, and perhaps my post could have been worded better, but wouldn't those assets be sold in a very bad market, leading to significant losses? In 2008 our properties dropped in value by approx £1m, but are now well over £2m higher than they were in the dip. Obviously we didn't sell back in 2008, in fact, we actually bought another investment property (which has doubled in value) taking advantage of the lower values.

The platform would need to act in the best interests of its investors. That could mean not selling immediately, or granting an extension to a loan. Loans on property at 60-70% LTV (where this is a realistic valuation) do already have some headroom for properties to be sold at a loss, but actual sale prices could be less than this in a bad market as you say. Diversifying among different types of security is helpful. I wouldn't want all of my P2P secured on property loans and tend to have quite a variety in my P2P portfolio.

EDIT: Another problem that I (I realise that this is irrelevant to a lot of people) have with P2P is that I wouldn't be able to spend the extra returns (we are already going to struggle to spend everything), so it seems daft to accept risks for no upside, at the end of the day you have to balance risk against potential 'real' gains.

Well if you can meet all of your financial goals without taking on any risk, then I agree that you should not. That seems like a very nice dilemma to have

jamesd wrote: »

Above that the rate is 18% for basic rate tax payers and 28% for those liable to the higher rate, roughly higher rate tax payers.

18%/28% is only for residential property.
Everything else is 10%/20%.