P2P Investing

FortuitousFluke · 5 Jan 2016 at 09:57

I've been investing £20 in funding circle monthly for the last 6 months with the intention of reinvesting the interest. It's a safe amount for me though I may look at upping to £60 in the near future. It's a good rate on the saving, more interesting than just plugging money into an ISA, as it allows me to take a more active interest in what my money is used to fund.

I really got involved because I like the concept, that £20 could be shoved into any kind of saving but I like p2p as an alternative to bank lending.

Uther · 5 Jan 2016 at 10:14

I'm finding it quite interesting, certainly better rates than the banks, obviously with a higher risk.
Zopa is looking like a total bust for me, money still going through processing from two days ago, and at lower rates than Ratesetter, where I have lent out several hundred in the same time period.
Might concentrate on RS, and also look at the maybe riskier ones like Funding Circle for some cash too.

The_Abyss · 5 Jan 2016 at 10:38

I put £2,000 back in for lending on Zopa yesterday morning (was sitting idle in my Zopa holding account) and £1,600 of it has already been lent out on 5 year terms.

Vanquish-Storm · 5 Jan 2016 at 10:53

What sort of money is worth investing into ratesetter? Do you have to have an initial large sum or can you just put £20-£50 in each month?

Say I put £50 will that get "bundled" with other peoples funds it somebody wants a larger loan?

EDIT: I say worth - but I mean just to get the ball rolling to get the idea of how it goes.

grumpysculler · 5 Jan 2016 at 12:35

Vanquish-Storm said:
What sort of money is worth investing into ratesetter? Do you have to have an initial large sum or can you just put £20-£50 in each month?

Say I put £50 will that get "bundled" with other peoples funds it somebody wants a larger loan?

EDIT: I say worth - but I mean just to get the ball rolling to get the idea of how it goes.

I think the minimum is £10 a time on ratesetter (which you can do by DD).

Ratesetter abstracts you from loans a bit, but basically when someone wants money they get matched with enough lenders to fill their loan at a suitable rate. So maybe half from you at 3.9% and half from someone else at 4.1% so the borrower gets a 4% loan.

A key thing about ratesetter is that because of the way the provision fund works, you don't need to diversify across loads of borrowers. Your exposure to each borrower is not relevant so all you really need to bother about is that you matched £X at Y%. How many loans are under that (and who they are to) is far less important than it is on other platforms.

darkgen · 5 Jan 2016 at 12:43

The_Abyss said:
I put £2,000 back in for lending on Zopa yesterday morning (was sitting idle in my Zopa holding account) and £1,600 of it has already been lent out on 5 year terms.

What rate did you get? I just checked the 5k on 5 year on my Zopa account and can now see 3.8k has been lent out at 4.7%. Ohh just looked at the Loan Book; wow some variable rates here.

The_Abyss · 5 Jan 2016 at 12:44

The same - 4.7%

Diddums · 5 Jan 2016 at 12:52

How often do you have to deposit? Can I fling a couple of grand in these things and just leave it or do I have to deposit every month?

darkgen · 5 Jan 2016 at 12:53

Whenever and as often or not as you wish. I've just slung a lump sum in two P2P products.

Diddums · 5 Jan 2016 at 12:59

Oh cool, thanks

Might hafta put some wedge in these to increase my portfolio a bit.

Vanquish-Storm · 5 Jan 2016 at 13:34

grumpysculler said:
I think the minimum is £10 a time on ratesetter (which you can do by DD).

Ratesetter abstracts you from loans a bit, but basically when someone wants money they get matched with enough lenders to fill their loan at a suitable rate. So maybe half from you at 3.9% and half from someone else at 4.1% so the borrower gets a 4% loan.

A key thing about ratesetter is that because of the way the provision fund works, you don't need to diversify across loads of borrowers. Your exposure to each borrower is not relevant so all you really need to bother about is that you matched £X at Y%. How many loans are under that (and who they are to) is far less important than it is on other platforms.

Perfect thank you for the explanation.

Uther · 5 Jan 2016 at 14:27

Rates do vary, I have put money in at 4.7 and 4.9 today on the 3 year market. Trawling through the forums, the 21st of the month seems to be a good time to put money in for some reason, so will keep some in my holding account and watch the market then to see if rates jump a bit. I've lent at 5.9 on the 5 year market but would love to see it above 6%. Makes my banks instant access saver account at 0.50% look a bit silly!
My small Zopa amount has just been lent out, so that's something, but rates seem definitely better on RS.

darkgen · 5 Jan 2016 at 15:04

Seems all too good to be true eh if you can forget the fact it’s all unsecured loans! I might also throw a few k into the 12% one (Savingstream) as my white knuckle ride risk for the year.

snappyfish · 5 Jan 2016 at 21:59

Uther said:
Rates do vary, I have put money in at 4.7 and 4.9 today on the 3 year market. Trawling through the forums, the 21st of the month seems to be a good time to put money in for some reason, so will keep some in my holding account and watch the market then to see if rates jump a bit. I've lent at 5.9 on the 5 year market but would love to see it above 6%. Makes my banks instant access saver account at 0.50% look a bit silly!
My small Zopa amount has just been lent out, so that's something, but rates seem definitely better on RS.

If you have 20k try Santander 3% current account

snappyfish · 5 Jan 2016 at 22:00

darkgen said:
Seems all too good to be true eh if you can forget the fact it’s all unsecured loans! I might also throw a few k into the 12% one (Savingstream) as my white knuckle ride risk for the year.

Spread it accross loans not all in one..

darkgen · 6 Jan 2016 at 08:47

snappyfish said:
Spread it accross loans not all in one..

I was looking at between 200 - 400 spreads; it's certainly a lot more involved than the other P2P products and does require some effort to quickly research each property as it appears in the pipeline.

Vanquish-Storm · 6 Jan 2016 at 16:27

The rates on ratesetter don't half fluctuate throughout the day.

I see that they are the ones that give the loans on Giffgaff for phone purchases now.

The_Abyss · 6 Jan 2016 at 17:03

darkgen said:
Seems all too good to be true eh if you can forget the fact it’s all unsecured loans! I might also throw a few k into the 12% one (Savingstream) as my white knuckle ride risk for the year.

I'm not certain about Saving Stream. One of the directors has been involved what appear to be less than savoury investments (Guayana Gold), and there appears to be very little information on the responsibilities and accountabilities of the surveyors, let alone who they are. I think I'd want to know more about them, as everything hinges on the accuracy of the property value. If it is ambitious then the 70% LTV limit will be breached.

DIABLO · 6 Jan 2016 at 19:08

Diddums said:
How often do you have to deposit? Can I fling a couple of grand in these things and just leave it or do I have to deposit every month?

Thats what i do with Ratesetter i believe it was the first 2 deposits can be any amount fee free but after that you have to deposit a minimum of £1500 or get charged a £1.50 fee

And i have never not had a repaid loan not matched with a half day i have have the re-lend set to "market rate".

Uther · 6 Jan 2016 at 19:18

DIABLO said:
Thats what i do with Ratesetter i believe it was the first 2 deposits can be any amount fee free but after that you have to deposit a minimum of £1500 or get charged a £1.50 fee

And i have never not had a repaid loan not matched with a half day i have have the re-lend set to "market rate".

First three of any amount paid in by debit card are free, after that it costs to deposit unless the amount is over £1000.
Bank transfer is free to deposit IIRC.