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Post by masquedefer on Aug 17, 2014 13:59:13 GMT
Hello
I am currently invested in FC and now intend to extend my P2B/P lending over several lending platforms in order to diversify risk. I intend to increase my P2B investment to about £100k in total. So say 5 platforms @ £20k each
I would appreciate any feedback on SS's performance and likely future stability (e.g. level of defaults, liquidity of 2nd market, quality of service, etc., etc.) Also any guidance appreciated on other suitable P2B/P platforms.
Thank you in advance.
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shimself
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Post by shimself on Aug 17, 2014 14:16:48 GMT
Read the other threads on this forum. SS isn't p2p, you should probably think of it as one (decent chunky) loan
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Post by davee39 on Aug 17, 2014 18:21:24 GMT
Hello I am currently invested in FC and now intend to extend my P2B/P lending over several lending platforms in order to diversify risk. I intend to increase my P2B investment to about £100k in total. So say 5 platforms @ £20k each I would appreciate any feedback on SS's performance and likely future stability (e.g. level of defaults, liquidity of 2nd market, quality of service, etc., etc.) Also any guidance appreciated on other suitable P2B/P platforms. Thank you in advance. There are only a few people on this platform who may be in any way qualified to help with your question. If £100k is all your savings then it should not all be going into P2P. If it is, say, 20%, then you should be seeking , and paying for, professional advice. P2P platforms available are listed here www.p2pmoney.co.uk/You can make up your own mind as to which are suitable.
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Post by mrclondon on Aug 17, 2014 21:13:42 GMT
Hello I am currently invested in FC and now intend to extend my P2B/P lending over several lending platforms in order to diversify risk. I intend to increase my P2B investment to about £100k in total. So say 5 platforms @ £20k each I would appreciate any feedback on SS's performance and likely future stability (e.g. level of defaults, liquidity of 2nd market, quality of service, etc., etc.) Also any guidance appreciated on other suitable P2B/P platforms. Thank you in advance. At the present time only Zopa, Ratesetter and Funding Circle have been going long enough (3+ years) to be able hypothesise how the actual experienced default rate on those platforms might affect the long term overall return. There is a significant degree of uncertainty at present as to how SS will handle defaults, particularly those relating to the property bridging loans. They are a small team with a variable response time to queries depending on their availability. Secondary market liquidity appears fine at present but could well dry up once the first major default is experienced. If SS/Lendy Ltd was wound up involunatarily, there is a high probability that the liquidator would pool both security and loans and pro-rata any losses across all lenders not just those in the bad loans. My personal view is capital losses are inevitable if the platform folded, and have invested accordingly. There is, I'm afraid, no short cut to reading the threads on this forum and forming your own opinion of the suitability of each platform for your investment needs. Only you know the level of capital loss you can tolerate if things go badly wrong.
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shimself
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Post by shimself on Aug 18, 2014 13:23:30 GMT
Hello I am currently invested in FC and now intend to extend my P2B/P lending over several lending platforms in order to diversify risk. I intend to increase my P2B investment to about £100k in total. So say 5 platforms @ £20k each I would appreciate any feedback on SS's performance and likely future stability (e.g. level of defaults, liquidity of 2nd market, quality of service, etc., etc.) Also any guidance appreciated on other suitable P2B/P platforms. Thank you in advance. snip... If £100k is all your savings then it should not all be going into P2P. If it is, say, 20%, then you should be seeking , and paying for, professional advice. ... How correlated do you feel p2p is? After all we have consumer loans (zopa etc), business loans (tc etc), property (THC etc), equity/crowdfunding (syndicateroom), clean energy/govt guaranteed (abundance) even sort of pawnbroking. How much more likely are they to go south together than the stockmarket, with all its supposed asset allocation?
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Post by Deleted on Aug 18, 2014 14:12:40 GMT
I don't know how likely it is that SS will fail. All I know is that where invested money is not guaranteed (most investments except bank & building society deposits up to £85k) then the sensible investor spreads his eggs. I would not invest more than about 20% of my money in platforms like SS. Not because I think there will be major failure in the near future but because it is sensible to diversify and spread your risk. If your £100k is not the majority of your savings then putting 20k of that in SS would be OK with me. You don't get a 12% return without accepting some risk but if it wouldn't be disaster for you to lose that £20k or some of it then the 12% return makes it look an attractive gamble. Within SS I would recommend diversifying amongst as many loans as possible. One or two may default over time but highly unlikely all your loans would. Then your main risk is that SS folds or the bosses run off to Brazil.  |
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jonno
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Post by jonno on Aug 18, 2014 15:18:42 GMT
I don't know how likely it is that SS will fail. All I know is that where invested money is not guaranteed (most investments except bank & building society deposits up to £85k) then the sensible investor spreads his eggs. I would not invest more than about 20% of my money in platforms like SS. Not because I think there will be major failure in the near future but because it is sensible to diversify and spread your risk. If your £100k is not the majority of your savings then putting 20k of that in SS would be OK with me. You don't get a 12% return without accepting some risk but if it wouldn't be disaster for you to lose that £20k or some of it then the 12% return makes it look an attractive gamble. Within SS I would recommend diversifying amongst as many loans as possible. One or two may default over time but highly unlikely all your loans would. Then your main risk is that SS folds or the bosses run off to Brazil. Whilst I would concur with the broad thrust of your sentiments above particularly re diversification, I'm not sure it fully applies to SS given its funding model given that loans are not actually to borrowers but to Lendy.This does appear to give investors a greater level of protection to defaulting individual loans but vulnerable to the viability of Lendy itself.
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surby
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Post by surby on Aug 19, 2014 10:39:09 GMT
snip... If £100k is all your savings then it should not all be going into P2P. If it is, say, 20%, then you should be seeking , and paying for, professional advice. ... How correlated do you feel p2p is? After all we have consumer loans (zopa etc), business loans (tc etc), property (THC etc), equity/crowdfunding (syndicateroom), clean energy/govt guaranteed (abundance) even sort of pawnbroking. How much more likely are they to go south together than the stockmarket, with all its supposed asset allocation All investments (and platforms) could go south in the event of a global economic meltdown or hyperinflation. So could banks, as we saw last time. There is also regulatory risk, but it seems unlikely the FCA would want to regulate all of p2p out of existence, especially when the sector seems to improving the climate for business lending and increasing competition and choice for retail investors. Leaving those extreme scenarios aside, I don't think there is much correlation within the whole of p2p because as you note it is quite diverse across equity, loans, fixed interest and property and these all have different characteristics. p2p investments are priced by the platform in most cases, with resale often allowed only at par. Absent market pricing (which could cause a loss on paper) there may be a greater risk of being unable to sell and being forced to hold for the full term if an investment you hold is less attractive than new investments on offer.
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Post by davee39 on Aug 19, 2014 12:03:35 GMT
I don't know how likely it is that SS will fail. All I know is that where invested money is not guaranteed (most investments except bank & building society deposits up to £85k) then the sensible investor spreads his eggs. I would not invest more than about 20% of my money in platforms like SS. Not because I think there will be major failure in the near future but because it is sensible to diversify and spread your risk. If your £100k is not the majority of your savings then putting 20k of that in SS would be OK with me. You don't get a 12% return without accepting some risk but if it wouldn't be disaster for you to lose that £20k or some of it then the 12% return makes it look an attractive gamble. Within SS I would recommend diversifying amongst as many loans as possible. One or two may default over time but highly unlikely all your loans would. Then your main risk is that SS folds or the bosses run off to Brazil. Whilst I would concur with the broad thrust of your sentiments above particularly re diversification, I'm not sure it fully applies to SS given its funding model given that loans are not actually to borrowers but to Lendy.This does appear to give investors a greater level of protection to defaulting individual loans but vulnerable to the viability of Lendy itself. There seems to be a common view that because Lendy makes the original loan, the Lender is lending to Lendy. I consider it to be more like the Funding Circle Secondary Market. Lendy makes the original loan, but sells on Loan Parts to Lenders, who are theoretically at risk on the individual items if there is a default. Lendy continues to administer the loan as whole. One point regarding sums invested is that the relatively safe Boat Loans are in short supply (Based on the idea that Boats should be easy to resell). The main part of the business is now property and while these loans may look very attractive I personally believe they merit either professional advice, or a real understanding of the market, before risking substantial sums, which may not be guaranteed to repay in full at the end of the loan term. On sites aimed at sophisticated investors there is a requirement to confirm that no more than 10% of an individuals free assets will be invested in 'risky' asset classes. This DOES NOT APPLY to SS, but it provides a starting point to stop and think before running after a 12% return. I do have a small investment here, but it will never be more than 0.5% of my total funds (Zopa and RS are both at 12%) since I cannot risk losing the capital I live off.
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shimself
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Post by shimself on Aug 20, 2014 9:59:55 GMT
There seems to be a common view that because Lendy makes the original loan, the Lender is lending to Lendy. I consider it to be more like the Funding Circle Secondary Market. Lendy makes the original loan, but sells on Loan Parts to Lenders, who are theoretically at risk on the individual items if there is a default. Lendy continues to administer the loan as whole. Can we have a comment from SS please, the heart of the matter being if the worst happens to Lendy what happens to us investors?
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Post by batchoy on Aug 20, 2014 11:03:49 GMT
There seems to be a common view that because Lendy makes the original loan, the Lender is lending to Lendy. I consider it to be more like the Funding Circle Secondary Market. Lendy makes the original loan, but sells on Loan Parts to Lenders, who are theoretically at risk on the individual items if there is a default. Lendy continues to administer the loan as whole. Unless it has changed since Lendy launched SS, the problem that I have with this view is the differential between the stated interest and fees for the borrower and the stated interest and fees for the lender which leaves a large chunk of money that disappears into Lendy's coffers. Taking the simple view if the lender is buying part of the original loan then SS are charging a hefty but unstated fee on the interest paid on the loan part, or as per the view I originally took, the Lendy is lending to the borrower, the lender is lending to Lendy and during the period of the borrower's loan Lendy assigns a portion of the security held on the borrower's loan to the lender and pays interest on the Lender's loan at a lower rate than is being paid by the borrower on the loan paid by Lendy for which the Lender has been assigned some of the security.
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Post by savingstream on Aug 20, 2014 15:33:02 GMT
As posted previously:
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shimself
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Post by shimself on Aug 21, 2014 12:47:36 GMT
Others might be able to pose a better question than mine, but I'm still not clear to whom each borrower owes the money. Is it to me as a lender, or is it to SS?
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jonno
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Post by jonno on Aug 21, 2014 13:20:17 GMT
I'm sure that 3rd party cover is somewhat reassuring to investors,but I believe the main issue at hand is precisely what an "orderly administration of contracts" actually means.Is it that each loan would be treated as a discrete entity with investors holding their "owned" portion of each loan (i.e. the more purist P2P model);or would the summation of all loans be treated as Lendy debt and investors be part of any liquidation scrum?. Sorry if we appear to be labouring this point,and I am sure that it isn't borne out of some sudden concern about the viability of S.S.,but I think it is important that when making investment decisions we have clarity on this matter.
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j
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Post by j on Aug 21, 2014 17:41:19 GMT
At the end of the day, it depends on the level of risk you can personally accept which will decide what % you'd be willing to invest in p2p. The returns are infinitely better than leaving funds in a bank at the moment, that's for sure
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