linton
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Post by linton on Feb 8, 2017 12:21:38 GMT
Good afternoon everyone Apologies if this is not the place for such questions, if it isn't let me know and I'll see about getting it removed. Recently I've been trying to get into the interesting world of P2P lending. However, what I'm starting to notice is just how broad and complex it actually is. I was lucky enough to stumble upon this forum from the MSE Forums and I see that there is an enormous wealth of knowledge here. The problem is that I'm getting a bit lost in it all! I tried looking for some guides online that would simplify it, but couldn't find what I was looking for. I'll give you some background. Like most people, I'm not happy with the interest rates being offered by banks, and I'm a bit put off at just how volatile the stock market is especially now, so I'm looking for alternative ways to make some sort of return on savings. I currently have set aside £6,500 or so to invest in P2P lending with the aim of putting in another £500 each month (more if I actually get the hang of it!). I put £2,000 into a Ratesetter about 10 months ago just to see how it worked, and that has been going decently well, but I've been reading about higher returns (12% in some cases), additionally, common logic is not to put all of one's eggs in one basket, so I should likely be looking at using a range of P2P lenders. The questions is... where to continue from here? I'm using Ratesetter because it was easy and relatively straightforward, but I have no idea where to go next. I'd like to eventually be able to get into some of the more complex ones where I'm selecting loans and actually aware of the risk level of each platform, but I am pretty certain I'm not knowledgeable enough for that yet. I also got a bit put off at people stating that certain loan categories kept changing, etc. and wouldn't have a clue how to decipher all of that at this point. I'm not particularly risk adverse, but obviously having no clue about what I'm doing is high risk in itself. Thank you in advance for any guidance offered.  |
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pom
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Post by pom on Feb 8, 2017 12:34:07 GMT
It all really depends how much work you're able/willing to put into it. You can't get easy and the best rates in the same site unfortunately! A halfway house might be Bond Mason, where they diversify you across multiple p2p sites with different types of loans. Otherwise it's stick with other hands-off sites (my current favourites are Lending Works, Landbay, Octopus) or take the plunge and try small amounts in the active sites (I like Moneything and ABLrate the most tho ABL is pretty complicated/advanced). Be wary of any sites that offer a mix of autoinvestment/manual selection as none really seem to be fully configurable. and personally I'd stay well clear on SME loans - stick to loans with security.
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linton
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Post by linton on Feb 8, 2017 14:15:13 GMT
Thank you! At the moment I really don't have much time to put into it, so I would need to go for options that require less research and study. I'm hoping with time as work pressures ease I'll get a bit more spare time to work with these things. Bond Mason seems to be a good idea, if they're actively doing the work in exchange for a cut of what's earned. I'll get a look at those sites you've suggested. Are there any sites that I should be avoiding in particular, that you're aware of? Thanks |
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pom
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Post by pom on Feb 8, 2017 14:23:18 GMT
Well we've probably all got our own personal preferences but the ones I wish I'd never gone near are Funding Circle, Lending Crowd (both of which now would fail my "avoid SME loans" advice), The House Crowd, and to a lesser degree Funding Secure (tho a lot of people like them).
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Post by Deleted on Feb 8, 2017 14:50:35 GMT
Great advice from Pom. I'd also look at diversity. Both across a number of loans and different type of loans. So Property, and art, and trubines, and jewelry and cars might be the way to go. I like my individual loans to be sub 1% of the total invested. With your capital level it might be hard to achieve but maybe aim to keep every loan at the £150 to £200 mark as a maximum.
Bonds will do that for you but if using MThing then you need to do that yourself and be available at 4pm precisely which is when the majority of deals go live
FSecure is normally around 11am BTW and FS is not for everyone.
I use the don't rush, don't repent system. If I don't like the risks, I avoid the loan.
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kaya
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Post by kaya on Feb 9, 2017 12:31:55 GMT
Good afternoon everyone I'm not particularly risk adverse, but obviously having no clue about what I'm doing is high risk in itself. Thank you in advance for any guidance offered. Don't have much of a clue either. Crowdfunding is good for following the crowd though. I just hope they know what they are doing. 
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james
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Post by james on Feb 9, 2017 19:48:48 GMT
I currently have set aside £6,500 or so to invest in P2P lending with the aim of putting in another £500 each month (more if I actually get the hang of it!). I put £2,000 into a Ratesetter about 10 months ago just to see how it worked, and that has been going decently well, but I've been reading about higher returns (12% in some cases), additionally, common logic is not to put all of one's eggs in one basket, so I should likely be looking at using a range of P2P lenders. The questions is... where to continue from here? What I suggest you do is initially spread about 250 per loan over the secondary markets and two new loans at Ablrate then look to invest the rest at MoneyThing. The Ablrate secondary market is pretty easy to use for getting invested like this: 1. Click on the secondary market text. 2. Click on trade next to a loan. 3. In the box at the bottom right enter the amount you want to invest and click on calculate. 4. You'll be told the annual equivalent rate (AER) that you will get. Click on the execute button to buy or cancel not to. Above the box you can see a list with offer price, yield and size. Your buy will be filled from the highest yield first, working down. Those can vary a lot and you might want to just buy enough to get the yields that are best. You could also stick to enough for the best one or two and see whether someone comes in with another offer at the same price later, perhaps in a day or three. That's fairly common. You should look at the loan details as well but there's nothing worrying that you can buy at the moment. You'd probably buy some from me if you did this for all loans. Depends just what you buy and when, since it can change a lot. MoneyThing can be a bit more challenging to do secondary market buys from because they tend to go quickly. Try the hour or so before a new loan goes live and after 10PM. New loans are easier and you should be able to get invested in a few weeks even without using the secondary market. As with Ablrate there's nothing worrying that you could buy, just different shades of decent. At both places you'll find reasons to prefer different loans as you learn more but this will get you started and it's easy enough to sell later. Avoid Saving Stream. You can't trust that the deals are all decent, they aren't, and you can't trust that the information provided is complete or accurate. Caveat emptor applies there. It's the UK place where you're most likely to get hurt if you don't know exactly what you're doing.
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Liz
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Post by Liz on Feb 9, 2017 21:21:14 GMT
If you want to get diversified quickly, Fundingsecure has some bargains on the SM and lots of loans launching weekly.
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vmail
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Post by vmail on Feb 10, 2017 0:05:00 GMT
You want to stay away from MoneyThing, its not good for you.
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james
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Post by james on Feb 10, 2017 4:59:53 GMT
You want to stay away from MoneyThing, its not good for you. Careful, a newcomer might take that seriously, not as a joke.
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Post by jackpease on Feb 10, 2017 7:41:10 GMT
Avoid Saving Stream. You can't trust that the deals are all decent, they aren't, That seems harsh! I think with SS we now have 'known unknowns' ie we know some of them are not what they seemed. Ditto FC and a bunch of others. Some of the go-to suggestions in this thread are younger and have not had the problems that have manifested themselves at SS that have then led to uber-poking around by forumites. Presumably SS gets its loans from the same pool as MT/FS etc - it may be in a year's time that the current forum favourites also have flaws Jack P
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Post by lynnanthony on Feb 10, 2017 16:33:50 GMT
I can't say I agree with the blanket advice to avoid SME lending. Possibly what was meant was avoid debenture lending? The description SME does not necessarily imply poor security. I'd say look closely at the security on SME lending, and avoid it if security is limited to a debenture and/or PGs. But some SME lending does have better security.
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kaya
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Post by kaya on Feb 10, 2017 16:51:44 GMT
If you want to get diversified quickly, Fundingsecure has some bargains on the SM Only if it repays!
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rick24
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Post by rick24 on Feb 10, 2017 17:24:20 GMT
I like BondMason for hands-off investment.
AssetzCapital allow SME investing with security. They don't put any value on personal guarantees.
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linton
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Post by linton on Feb 10, 2017 22:01:25 GMT
Thank you all for the contributions, there are a number of very sensible options for me to explore along with some ideas of where I probably should avoid!
I quite like the idea of Bond Mason, where I'm trading a bit of my return and getting them to do the work for me... but I'm going to hold off momentarily, I'm off work a few days next week, so I'll be able to take some time to give it the attention it's due! There seems to be quite positive reviews of Ablrate and MoneyThing, so I'll have to dig around there too!
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