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Post by beepbeepimajeep on May 5, 2016 13:44:14 GMT
Hey,
Considering investing some money on FS and doing my own research, I came across this article which appears to contradict itself. I just wonder if I am reading it correctly (I might well not be) and what the actual truth is.
www.financialthing.com/funding-secure-review/
It says at one point "What are the Main Risks?
Platform Failure: Since you are lending to FS rather than to borrowers, if the platform were to fail, you’d probably lose your money"
But then later on it says
"Am I Lending to Funding Secure or to Borrowers?
Borrowers. All investors funds are ring-fenced and kept in a separate client account until the individual loan is activated at which time the funds are transferred to the borrower – via a solicitor. Each investor can download a specific contract for each loan they are party to – confirming the borrower, the amount invested, the rate of interest and the dates of activation and completion.
What Happens if Funding Secure Goes Bust?
All of the loans would remain in place and continue earning interest. I presume a 3rd party administrator would handle the loans
"
Is that not a complete contradiction in the article? If so which is the truth? When a loan is struck who is it between? And if FS was to go bust when I had many loans in place would I still be owed those loans or would they be owed to FS?
Thanks for any replies, sorry if I have made a big misunderstanding.
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 11,329 
Likes: 11,549
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Post by ilmoro on May 5, 2016 14:20:37 GMT
Hey,
Considering investing some money on FS and doing my own research, I came across this article which appears to contradict itself. I just wonder if I am reading it correctly (I might well not be) and what the actual truth is.
www.financialthing.com/funding-secure-review/
It says at one point "What are the Main Risks?
Platform Failure: Since you are lending to FS rather than to borrowers, if the platform were to fail, you’d probably lose your money"
But then later on it says
"Am I Lending to Funding Secure or to Borrowers?
Borrowers. All investors funds are ring-fenced and kept in a separate client account until the individual loan is activated at which time the funds are transferred to the borrower – via a solicitor. Each investor can download a specific contract for each loan they are party to – confirming the borrower, the amount invested, the rate of interest and the dates of activation and completion.
What Happens if Funding Secure Goes Bust?
All of the loans would remain in place and continue earning interest. I presume a 3rd party administrator would handle the loans
"
Is that not a complete contradiction in the article? If so which is the truth? When a loan is struck who is it between? And if FS was to go bust when I had many loans in place would I still be owed those loans or would they be owed to FS?
Thanks for any replies, sorry if I have made a big misunderstanding.
The first statement is wrong. Ive come across this before on that site (the Moneything review I think) where they have contradicted themselves. FS have always been true P2P . FS have stated how their structure is proper P2P ie lenders to borrowers not the platform. p2pindependentforum.com/post/2179/thread and have repeated it more recently p2pindependentforum.com/post/75806/thread They are required by FCA to have third party runoff procedures in place to manage the loan book in the event of a FS failing. Edit - its in FS T&Cs they are the agent not the borrower
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Post by beepbeepimajeep on May 5, 2016 14:22:03 GMT
Thanks ilmoro appreciate the reply.
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