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Peer to Peer - experiences and risk?

Any other investment discussions eg. peer to peer lending
dspp
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Re: Peer to Peer - experiences and risk?

#212873

Postby dspp » April 5th, 2019, 9:33 am

I note from Mr C at viewtopic.php?f=33&p=212843#p212843

Funding Circle SME (FCIF) EGM to approve wind up and return capital. "Funding Circle has reaffirmed its willingness to support the Board so as to effect the best outcome for the Company's shareholders."

- dspp

mbdmbd
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Re: Peer to Peer - experiences and risk?

#213430

Postby mbdmbd » April 7th, 2019, 8:14 pm

I have recently been using Funding Circle P2P. I note that they are now quoting 30 days average time to liquidate your investment and 3 days to return funds once liquidated from loans.

They state that this period is due to there being a 30 day long queue of people selling loans. (Funding Circle don't phrase it quite that way)

I am in the process of extracting myself from there, especially in the light of recent articles in the financial press about the Funding Circle fund which is closely involved with funding circle (as a derivative?) - although I haven't investigated which owns which... if at all.

mbdmbd: 7th April 2019

uspaul666
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Re: Peer to Peer - experiences and risk?

#213440

Postby uspaul666 » April 7th, 2019, 9:03 pm

Be aware that FC silently removes loan principal from your totals when a loan enters formal recovery without any visible transaction. You have to go to “My Portfolio”/“Recent loan comments” and add up the exposure amounts manually. It’s difficult to tell which loans are still being recovered and which are utterly dead. This means that years later, recovery payments from loans you didn’t know you had may appear in your cash account which can affect your final return. It also means it’s impossible to calculate your unrealised return programmatically. It can be surprising how much recoveries add to p2p returns generally.

It’s been suggested elsewhere that the winding down of FCIF is either because of the poor returns from FC or because FC has huge institutional lenders now so doesn’t need to cash from the IT (or perhaps retail lenders anyway). It’s also been suggested that since FCIF is at a discount to NAV and it’s going to be run down (presumably *to* NAV) it’s an excellent buy but that’s a game that I would never play!

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Re: Peer to Peer - experiences and risk?

#213444

Postby JohnB » April 7th, 2019, 9:35 pm

I decided to withdraw from p2p 5 months ago. Getting out of FC was quick (bar the muddle of loans in recovery mentioned above), but much slower from other providers. I've only managed to get 50% out so far, and I suspect it will be years for the rest, and I expect substantial capital losses.

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Re: Peer to Peer - experiences and risk?

#213460

Postby Clitheroekid » April 7th, 2019, 11:09 pm

If any of you have got money ‘invested’ with Lendy it would seem prudent to get it out ASAP - assuming that you can!

https://www.telegraph.co.uk/investing/n ... -fund/amp/

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Re: Peer to Peer - experiences and risk?

#213471

Postby JohnB » April 7th, 2019, 11:37 pm

No-one has been able to get money out of Lendy this calendar year, other than interest payments, and a handful of loan repayments. Nearly all loans are overdue and not tradeable, or have a near infinite time to sale on the secondary market.

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Re: Peer to Peer - experiences and risk?

#213632

Postby argoal » April 8th, 2019, 2:30 pm

I have been withdrawing money as loans mature from Zopa since the start of the year.

The trend in bad debts there hasn’t reversed for me since I reported it at the end of last year.

It will take 3 years to have the bulk of my cash returned but I’m reasonably satisfied that I will be able to passively cash out like that without any real drama.

toofast2live
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Re: Peer to Peer - experiences and risk?

#213809

Postby toofast2live » April 9th, 2019, 9:42 am

dspp wrote:I note from Mr C at viewtopic.php?f=33&p=212843#p212843

Funding Circle SME (FCIF) EGM to approve wind up and return capital. "Funding Circle has reaffirmed its willingness to support the Board so as to effect the best outcome for the Company's shareholders."

- dspp


I assume this will make the sell out queue longer as all these loans come on to the market. And what about the “unsellable” loans? Do these become “sellable” now they are from the IT? Or do they have so many institutions queueing up with buckets of cash that it doesn’t matter. Hold on, though. If there are so many institutions with so much cash why is the queue for us mortals so darned long?

It has a nasty whiff swirling around in the foggy details.

dspp
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Re: Peer to Peer - experiences and risk?

#213839

Postby dspp » April 9th, 2019, 11:18 am

toofast2live wrote:
dspp wrote:I note from Mr C at viewtopic.php?f=33&p=212843#p212843

Funding Circle SME (FCIF) EGM to approve wind up and return capital. "Funding Circle has reaffirmed its willingness to support the Board so as to effect the best outcome for the Company's shareholders."

- dspp


I assume this will make the sell out queue longer as all these loans come on to the market. And what about the “unsellable” loans? Do these become “sellable” now they are from the IT? Or do they have so many institutions queueing up with buckets of cash that it doesn’t matter. Hold on, though. If there are so many institutions with so much cash why is the queue for us mortals so darned long?

It has a nasty whiff swirling around in the foggy details.


I don't know, but I too sense a bad smell.

I had a nasty suspicion this whole sector would go badly wrong from the very beginning, mainly because of the character of someone I knew who was heavily promoting the sector as an investment opportunity (i.e. not just as a lender, but also involved in setting up some of the vehicles). Hence I decided to stay well clear. From time to time I came across oddities that jarred that reinforced that view, such as my post #54362 of 16-May-2017 (viewtopic.php?p=54362#p54362). I will be surprised if the whole sector works off its loans book cleanly. More likely there will be some very unpleasant outcomes.

regards, dspp

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Re: Peer to Peer - experiences and risk?

#218162

Postby Gan020 » April 29th, 2019, 2:10 pm

Sunday Times reports Hop Stuff, which raised more than £1.5m from crowdfunding investors ‘has had its brewery seized by the landlord, been chased for an unpaid debt and delayed its accounts.’ See earlier Premium Emails for comments on the perils of crowd-funding.

Hop Stuff has reportedly been served with a winding-up petition by a shopfitter over an unpaid £30k bill. The Sunday Times reports Hop Stuff was founded in 2013 by former bank worker James Yeomans. It has raised money on Crowdcube three times, tapping more than 1,300 investors. In January last year, it raised £734,000 at a valuation of £25m. The brewery also has two bars.


Not P2P but I thought worthy of posting. Shows the danger of lending/investing at the risky end of the market.

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Re: Peer to Peer - experiences and risk?

#218248

Postby uspaul666 » April 29th, 2019, 7:01 pm

Hop stuff and lots more "funny" stories about crowd funding here: http://fantasyequitycrowdfunding.blogspot.com/?m=1

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Re: Peer to Peer - experiences and risk?

#223144

Postby DrGuid » May 20th, 2019, 12:45 pm

Thankfully I saw P2P as a fad and started winding it down in 2017. I was in 15 different ones at some point. I think I made some good money, although Lendy, Funding Secure and Assetz have turned into a horror show. All the money left in these bad loans is reinvested interest though, so it's not "my" money thankfully.

I opened an ISA with WiseAlpha but haven't been impressed that you can only use a robo advisor and can't pick individual bonds. I'm going off them too after the recent New Look disaster. I think that wiped out all my profits there.

I'm also in Bondora, but only because I've been picking over the bones in the secondary market.

If you have time on your hands and like math then there are some potential gems in P2P secondary markets. My REBS secondary market only account has twice the return of the one that invested in new issues.

But all in all the so-called disruptors seem to be heading for oblivion. I'm not even confident enough to keep much in RateSetter these days.

One other anecdote - back in 2015 Metro Bank refused me an account because I dabbled in P2P :lol:.

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Re: Peer to Peer - experiences and risk?

#223245

Postby Clitheroekid » May 20th, 2019, 7:26 pm

DrGuid wrote:If you have time on your hands and like math then there are some potential gems in P2P secondary markets.

Where are such `gems' to be found?

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Re: Peer to Peer - experiences and risk?

#224289

Postby uspaul666 » May 24th, 2019, 7:57 pm

Lendy, previously known as Saving Stream, has finally entered administration. I regard this as a good thing.
https://www.fca.org.uk/news/statements/ ... nistration

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Re: Peer to Peer - experiences and risk?

#226104

Postby Gan020 » June 1st, 2019, 10:12 pm

Peer to Peer Lendy closed down by FCA

http://www.p2pfinancenews.co.uk/2019/05 ... -poor-p2p/


Sector starting to unravel...

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Re: Peer to Peer - experiences and risk?

#226116

Postby Pendrainllwyn » June 2nd, 2019, 12:32 am

I am not familiar with Lendy but presumably a high risk investment with them offering a return of more than 12% per annum. No doubt there are other P2P platforms offering high risk investments. There are lower risk P2P lending opportunities out there. I lend with Assetz Capital. At the lower end of the risk scale I have invested in a loan paying as little as 5% backed by real estate with a 17% loan to value ratio. I may still lose money but I suspect this is highly different to what was on offer at Lendy. The sector may benefit in the long run from a clear out of the riskier providers.

Pendrainllwyn

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Re: Peer to Peer - experiences and risk?

#226354

Postby uspaul666 » June 2nd, 2019, 9:28 pm

There’s a group of lendy lenders coming together to provide a voice, press contact, fca pressure group thing. Available on Facebook as “Lendy Action Group” and as a (very new) web site http://www.lendyactiongroup.co.uk

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Re: Peer to Peer - experiences and risk?

#253114

Postby jaizan » September 22nd, 2019, 10:28 am

I would be inclined to watch the P2P lenders over a full economic cycle before putting any money there. The main fear would be careless lending and an excessive default rate.

The closest I have got to P2P is when letters from RateSetter started turning up addressed to a former tenant. This guy is an overseas student who returned home to Asia a few months ago.

Anyway, RateSetter have lent him money and keep sending letters to chase up payment. I've e-mailed them and returned several letters to sender. These people are clearly thick.

There are 2 obvious problems with their business practices:
1 Lending to people temporarily in the UK is careless, as recovering the money when they leave the UK or Europe is difficult. I've never seen a bank to this, but RateSetter think it's OK.
2 They ignore all correspondence sent back to them.

So I wouldn't lend money to companies like RateSetter.

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Re: Peer to Peer - experiences and risk?

#253542

Postby gbjbaanb » September 24th, 2019, 12:01 pm

jaizan wrote:Anyway, RateSetter have lent him money and keep sending letters to chase up payment. I've e-mailed them and returned several letters to sender. These people are clearly thick.

Not thick, just computerised. The money lent out that's obviously defaulted will simply end up as a "cost of doing business" that they will already have discounted on a statistical basis. They expect losses like this. They probably expect the cost of chasing it up to be greater than the cost of sending a few letters out and then selling the debt on to a collection agency for next to nothing.

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Re: Peer to Peer - experiences and risk?

#255125

Postby Berwicklaw » October 1st, 2019, 1:06 pm

Funding circle. Had c £50000 invested . Very well spread and the vast majority in A graded loans. Suffered c 4-5 % of bad debts or poorly recoverable loans. I expect to probably claw back c 1% in recoveries leaving 3 % as bad debt level (And that's devan le deluge to come after Brexit) Net return after tax zero. Company has poor risk assessment. I don't recommend.


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