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I have a lot to learn!! How can you get 18% return?
On Ratesetter, I can't see how you would get a borrower to offer you a higher rate than the market average at any given time. From what you have all said though, there are more pick and mix borrowers to choose from on other platforms where you can take a higher risk and thus offer a higher rate?
Originally posted by granta
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18% return i suspect comes with a higher level of risk.
Every platform does things differently.
Ratesetter as I previously said is a bit passive in that you dont "choose" who you lend money to, the only thing you can do is manually set the rate you want to lend out at and even that has been described as awkward to setup by many. Primarily because its in ratesetters interest for you to lend at their definition of market rate.
Assetz you can fire and forget in a similar way with the instant and 30 day accounts, stick £500 into the 30 day and odds are you would get 1/12th of 5.1% next month in interest.
But they also have the MLA (Manual lending account), where you decide if you are going to lend £100 to someone who wants to buy a chip shop in Nottingham or £200 to someone who wants to renovate an inherited property to sell on or £300 to someone who wants to buy their business premises. This is fun and I like it. Its also nice because if you invest in a number of these the repayments are all throughout the month so almost every day I log in and see interest being added.
Another platform like Kuflink is all property and again you can invest £100 for someone to develop some flats or they also have an "autoinvest" option where you throw £200 in and it splits that across 5-10 different loans.
Kuflink does some good referral bonuses as well, think its £100 for referrer and £100 for referre and last time i looked it was for a £500 investment (@bxboards on this forum is a good sharer of bonuses for kuflink)
I suspect the 18% is higher risk platforms, ultimately it is all a gamble though and the adage goes dont gamble what you cant afford to lose.