Greenwood2
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Post by Greenwood2 on Aug 25, 2021 16:09:41 GMT
I have been re investing for the last 6 months or so in Core , expecting this to be slightly less risk. Today my balance is £6 less than last month , (taking late payments , qued cash etc in to account) so I called to discuss. The young lady was very vague on answering my questions and eventually said it may be a loan thats defaulted sending my balance less. I sthis normal? She also commented that even with reinvestment of funds , I can still be buying poorly performing loans! Maybe I misundertsood but I believed I was investing in new loans in core that met zopas new and stricter lending criteria. This seems not to be the case. Can someone please explain before I finally give up on p2p completely. After spending nearly 3 hrs over 3 days with AC trying to get a "software" issue fixed to allow transfer from ISA to cash account , im starting to wonder if this hassle is worth it. If you have large 'chunk size', even single loans defaulting can impact the interest earned in any particular month. If you make big individual deposits that are then split into 10% loan chunks (I believe 5% now) each loan can be quite large and can then be a large default, although theoretically it should come out the same over time if you have enough loans. Some lenders are careful to add funds in amounts to keep individual loan size to £10 or £20 each. You will get a mix of new loans and loans being sold by other lenders, I'm not sure sold loans are going to be worse in terms of defaults than the Covid loans, we won't know until the latter work through the system. I mainly use plus because of the higher initial rates which I hope outweigh the greater potential losses (the expected returns are higher for plus according to Zopa) and the higher losses in plus give more to offset against tax.
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Post by mfaxford on Aug 27, 2021 9:03:35 GMT
So looking through the loanbook CSV file
Are you receiving the projected returns ? 4.0% is a ceiling but 2.0% isn't a floor. What about the capital in the defaulted loans, how much is recovered and how long does it take ? From a very quick look based on what I might expect to get as a monthly return based on my invested amount and a 4% return rate it's not that far off based on the monthly summaries (and averaging them for 2021). It's not that scientific as I've been withdrawing some funds from my account so returns for the start of the year should have been higher than they would be now, There's also been a couple of months with almost zero returns (defaults almost equal interest). I've also only been re-investing into Core having previously had a spread between core and plus (and some classic). Interestingly, looking at the numbers of defaults across the different products core and plus are close to equivalent in terms of defaults (when taking my spread of loans into account) I just tried a flawed comparison looking at the spread of invested funds at the start of the year and comparing to the number of defaulted loans. I'll include the numbers below but the percentage for classic defaults is misleading as they all have a high percentage repaid (so the financial impact is relatively low). The spread of loan ages in Core and Plus should be broadly similar (although I've not checked in detail) Based on invested funds at the start of the year this was my breakdown of loans Core 69%, Plus 29%, Classic 2% And looking at the number of defaulted loans Core 69%, Plus 14%, Classic 17%
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mogish
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Post by mogish on Nov 16, 2021 8:11:28 GMT
30% increase in late payments this month.
Think it's time to run down Zopa. I was reinvesting in isa and ditching everyday account but time to move on.
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ashtondav
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Post by ashtondav on Nov 16, 2021 12:32:16 GMT
ZOPA neither want nor need our money now they are a bank. Until they relaunch p2p it is indeed time to move on. Sad as ive been with them since 2005 and as a founder member even have share options when the IPO!
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arien
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Post by arien on Nov 17, 2021 11:56:59 GMT
ZOPA neither want nor need our money now they are a bank. Until they relaunch p2p it is indeed time to move on. Sadly, this certainly appears to be the case. With lending queues at 90 days, every month only a third of my repayments are getting reinvested, so I'm having to move a large chunk of my investment into other asset classes every month. It's such a shame as I was quite happy with the steady 4-5% return I've received from Zopa over the last few years, especially the tax free ISA component. Not so long ago they were begging for our money and offering bonuses, now it feels like repayments are being reinvested in a tiny trickle.
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Post by fuzzyiceberg on Nov 18, 2021 8:59:10 GMT
Unfortunately Zopa has a clear conflict of interest between how much of the loans originated are allocated to P2P and how much they keep for themselves. Their interest is to keep as much as possible for themselves (funded with cheap bank deposits ), our interest is to have as much as posisble allocated to P2P investors. I have seen no statement how Zopa ethically manages this conflict. In its absence it is wise to assume they put their own interests first. We all know that Private Equity, Banks, and Ethics do not sit well together.
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