Lending Ethics

I do not invest in certain loans purely because of the proposed activity.  By the way, the 12 per cent return is not safe if by that you mean guaranteed. 

By the way ilmoro, I too would be interested to know what two loans you are referring to, a a few posts back.

Don't suppose you would have an address?


From an ethics point of view, I probably set the level quite high (or low?). For example I had some money in Log book loans on TC. I guess some might disapprove of this type of finance.

thickmick:  Perhaps you'd care to explain what you mean by "guaranteed".

Speaking from experience -- admittedly on other platforms -- I have participated in loans where the interest was (mostly) paid during the life of the loan, but the capital was not fully returned.  I'm also involved in some overdue P2P loans where interest is accruing at a nice rate, but the recovery process has been so long and difficult that it's extremely unlikely that the accrued interest will ever be paid in full.

If you read the current SS Ts&Cs, I think you'll find that interest on overdue loans can be accrued rather than paid, and that if there's a shortfall in the proceeds from a recovery sale the investors' accrued interest is well down on the payment priority list -- after recovery fees, capital return, and SS fees.  Payouts from the Provision Fund are discretionary and might not be sufficient to cover accruals. 

So IMHO SS returns definitely are not guaranteed in any way.

I don't invest in anything labelled "green/eco" such as windmills, solar farms etc on the simple basis that any business/proposition that relies on govt/public subsidy to make economic sense doesn't justify supporting. The fact that they are unwanted eyesores, contribute next to nothing to our energy supply & manmade global warming is a fantasy that has turned into a gravy train for those who can't get a job that adds anything positive to society are just extras reasons not to invest.

On the other hand I would be happy to support a fracking loan as there are many economic & practical reasons to justify why it is necessary. I also prefer the reward to match the risk whether or not I support the underlying proposition.

If in the course of due diligence I find things I'm not happy with ethically I will pass. But it's not something I would normally highlight on this forum; each has to make their own decisions in this area.  And if it's not clear what the purpose is I am not going to get concerned with hypotheticals.

In terms of specifics there's a current pipeline loan where the viability of the projects seems to depend on there being a casino so I am avoiding that one. I had no issue with the two loans il moro referred to but I may not have the full story. I would also tend to avoid loans where it is evident that there is strong local opposition, which is reasonable, to a stated purpose of the loan.  I'd already decided to give the recent loan (for some reason stated to be in Birmingham but actually in the Black Country) a miss because of the lack of planning permission. But even if it had been granted I would not have been keen because when I read the valuation the local opposition to the development seemed warranted. I am not against wind farms per se but the same applies where the proposal is ill-conceived.

I don't pretend my choices will make any difference to the funding, and I don't expect Saving Stream or any other platform to do anything differently, but each has to be comfortable about how thay make money and for the two or three loans that I've missed I've made up for it with greater investment in others.

I'm not entirely sure.... I think you only have to worry about it when you get caught...