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Post by ogwellian on Apr 8, 2016 11:34:13 GMT
I've had five defaults since joining FC in August 2014.
The borrowers have stopped paying after 7, 6, 5, 4 and 2 payments.
For the last few months I've changed strategy and sold all loan parts after two payments and not a default in sight.
Until now that is and B credit scored 18908 has just managed one repayment.
The third instalment is due Monday so I'm not holding much hope. Almost fraudulent borrowing.
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happy
Member of DD Central
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Post by happy on Apr 8, 2016 14:32:33 GMT
I've had five defaults since joining FC in August 2014. The borrowers have stopped paying after 7, 6, 5, 4 and 2 payments. For the last few months I've changed strategy and sold all loan parts after two payments and not a default in sight. Until now that is and B credit scored 18908 has just managed one repayment. The third instalment is due Monday so I'm not holding much hope. Almost fraudulent borrowing. This is the reason I have stopped unsecured lending to SME on FC. I had 3 A loans default within a few months of each other, one made 1 payment (cashflow issues), the second made 3 payments and then went into administration and the third was defaulted by FC after making only 4 payments over 7 months. Little chance of significant recovery although to be fair FC are pursuing the loan guarantors for bankruptcy so all may not be lost. I will probably still lend to selected lower LTV secured property loans to provide some platform diversification but I personally feel FCs SME due diligence is just not strong enough for me and it's A+/A loans are too risky for the return offered. If I can suffer a 1% loans default rate within a few months on selected A ranked loans in these relatively benign market conditions I shudder to think what could happen in more challenging market conditions. I'm not saying don't lend on FC but diversify across loans and platforms and choose who you lend to with great care especially where that lending is not secured against assets. Good Luck!
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Post by Deleted on Apr 8, 2016 21:29:35 GMT
I've had five defaults since joining FC in August 2014. The borrowers have stopped paying after 7, 6, 5, 4 and 2 payments. For the last few months I've changed strategy and sold all loan parts after two payments and not a default in sight. Until now that is and B credit scored 18908 has just managed one repayment. The third instalment is due Monday so I'm not holding much hope. Almost fraudulent borrowing. This is the reason I have stopped unsecured lending to SME on FC. I had 3 A loans default within a few months of each other, one made 1 payment (cashflow issues), the second made 3 payments and then went into administration and the third was defaulted by FC after making only 4 payments over 7 months. Little chance of significant recovery although to be fair FC are pursuing the loan guarantors for bankruptcy so all may not be lost. I will still probably still lend to selected lower LTV secured property loans to provide some platform diversification but I personally feel FCs SME due diligence is just not strong enough for me and it's A+/A loans are goo risky for the return offered. If I can suffer a 1% loans default rate within a few months on selected A ranked loans in these relatively benign market conditions I shudder to think what could happen in more challenging market conditions. I'm not saying don't lend on FC but diversify across loans and platforms and choose who you lend to with great care especially where that lending is not secured against assets. Good Luck! Well, the early defaults are well know and one of the reasons most of the 'experienced' FC manual investors stopped any new SME investment at least in the last 12 months. I strongly feel FC is NOT a good investing option today. Very very risky and also with poor recovery rates. Honestly I don't see why anyone should invest in unsecured loans like SME loans and even less reasons to invest with FC, which clearly shows lack of due diligence and lack of recovery real efforts. Look around. There are excellent 12% secured loans opportunities
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Post by p2plender on Apr 9, 2016 8:18:06 GMT
Well I was going to do the 'free ipad air offer' for me and the wife but after reading I think I'll avoid this now.
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Post by cassiopeia on Apr 9, 2016 14:14:50 GMT
This is the reason I have stopped unsecured lending to SME on FC. I had 3 A loans default within a few months of each other, one made 1 payment (cashflow issues), the second made 3 payments and then went into administration and the third was defaulted by FC after making only 4 payments over 7 months. Little chance of significant recovery although to be fair FC are pursuing the loan guarantors for bankruptcy so all may not be lost. I will still probably still lend to selected lower LTV secured property loans to provide some platform diversification but I personally feel FCs SME due diligence is just not strong enough for me and it's A+/A loans are goo risky for the return offered. If I can suffer a 1% loans default rate within a few months on selected A ranked loans in these relatively benign market conditions I shudder to think what could happen in more challenging market conditions. I'm not saying don't lend on FC but diversify across loans and platforms and choose who you lend to with great care especially where that lending is not secured against assets. Good Luck! Well, the early defaults are well know and one of the reasons most of the 'experienced' FC manual investors stopped any new SME investment at least in the last 12 months. I strongly feel FC is NOT a good investing option today. Very very risky and also with poor recovery rates. Honestly I don't see why anyone should invest in unsecured loans like SME loans and even less reasons to invest with FC, which clearly shows lack of due diligence and lack of recovery real efforts. Look around. There are excellent 12% secured loans opportunities Aren't these 12% secured loans on platforms which are themselves less secure than the big P2P operators such as FC, RS, Zopa? I suppose investors need to see evidence of insurance against fraud and an agreement with others to pick up running the loanbook in case of trouble, or else you are simply risking everything in one company. I was hoping the delay in the new IFISAs were due to this requirement, but I'm not sure if that's the case now.
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registerme
Member of DD Central
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Post by registerme on Apr 9, 2016 14:27:06 GMT
Well, the early defaults are well know and one of the reasons most of the 'experienced' FC manual investors stopped any new SME investment at least in the last 12 months. I strongly feel FC is NOT a good investing option today. Very very risky and also with poor recovery rates. Honestly I don't see why anyone should invest in unsecured loans like SME loans and even less reasons to invest with FC, which clearly shows lack of due diligence and lack of recovery real efforts. Look around. There are excellent 12% secured loans opportunities Aren't these 12% secured loans on platforms which are themselves less secure than the big P2P operators such as FC, RS, Zopa? I suppose investors need to see evidence of insurance against fraud and an agreement with others to pick up running the loanbook in case of trouble, or else you are simply risking everything in one company. I was hoping the delay in the new IFISAs were due to this requirement, but I'm not sure if that's the case now. "Secure" and "big" aren't necessarily well correlated - look at, for example, Lehman's and RBS. Your point about ".... or else you are simply risking everything in one company" is well made, and why most would advocate diversifying across a number of different platforms.
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Post by GSV3MIaC on Apr 9, 2016 14:58:55 GMT
Seconded .. there is borrower risk (which most platforms suffer from, especially the unsecured SME loans, backed by a ho-hum directors guarantee), and the platform risk ('run on the bank' being not impossible, if enough people determine that platform XYZ specialises in lending to all the wrong people .. or as in a couple of foreign cases, out and out fraud at the platform level).
Part of the FCA screening requires platforms to have some graceful collapse mechanism that passes the loans to a 3rd party for collecting, but that will obviously (hopefully) remain untried, and we know how well untried fall-back plans are likely to work. ('Yeah well, I didn't KNOW the backups were not happening until the main machine caught fire'). Whether there is anything to collect is the other problem.
My analysis of the couple of platforms I have looked at so far tends to suggest that their credit/risk assessment and thus grading/rate setting mechanisms are poor .. i.e. they can't tell an A+ from a D- with any degree of certainty, so the safest way to proceed is to assume that practically everything is a D-, and price/bid accordingly. Secured (on property or real assets) loans are usually safer, so why FC think we want to lend to an A+ business at 6-8%, when we can get 8%-12% secured on an asset elsewhere (or even at FC for a property loan) just mystifies the heck out of me.
Early defaults usually indicate the business was in deep doo-doo before we gave them the loan, although I think there are a couple of cases where major market shift (oil price collapse for instance) can be blamed for some of it. You have to remember that if these businesses were really A++ material they probably wouldn't be asking us .. we are lending to the Greece/Argentina end of the market, not Switzerland. 8>.
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Post by Deleted on Apr 10, 2016 21:46:16 GMT
Well, the early defaults are well know and one of the reasons most of the 'experienced' FC manual investors stopped any new SME investment at least in the last 12 months. I strongly feel FC is NOT a good investing option today. Very very risky and also with poor recovery rates. Honestly I don't see why anyone should invest in unsecured loans like SME loans and even less reasons to invest with FC, which clearly shows lack of due diligence and lack of recovery real efforts. Look around. There are excellent 12% secured loans opportunities Aren't these 12% secured loans on platforms which are themselves less secure than the big P2P operators such as FC, RS, Zopa? I suppose investors need to see evidence of insurance against fraud and an agreement with others to pick up running the loanbook in case of trouble, or else you are simply risking everything in one company. I was hoping the delay in the new IFISAs were due to this requirement, but I'm not sure if that's the case now. Well, do your own due diligence and evalutate case by case your investments. I feel much safer with a solid asset backing my loan. Even if the company managing the loan failed, there would be a parth to continue servicing the loan and the asset would ensure that idea/attempt by the borrower not to respect that agreement would fail. It is a very strong incentive to repay, while PG have shown (to be soft) huge limits with FC and clearly do not work for most borrowers (even those with good personal possessions, as we have seen with some known bankrupcy-seekers/laywers). Of course I am not suggesting to put everything in one basket, but to look around. There are at least 4 different companies offering very good asset backed loans and even FC themselves have been offering many decent property loans last year (but then the yield dropped too much this year for my likings...)
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Post by nightmare on Apr 11, 2016 16:16:49 GMT
hor1997 - "... and even FC themselves have been offering many decent property loans last year" - OMG for a moment there I actually thought you were saying something good about FC but then you go and spoil it all by adding "(but then the yield dropped too much this year for my likings...)". Ah well I suppose that frontal lobotomies don't come cheap these days.
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Post by chielamangus on Apr 11, 2016 16:51:48 GMT
I have only two interests in FC - withdrawing money as it becomes available, and watching the race between fees and losses. Losses currently in front by a neck. But to be fair to FC, on a second account concentrated mostly on property, losses have been zero.
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