Funding Secure – 12 Month Results

12 month results

The first full year results for lending through Funding Secure are as follows –

Expected ROI (Annualised) 12.00%
Actual ROI (Annualised) 3.08%

The ‘Expected ROI’ figure is taken from the average headline figure across each of the loan parts held over the last 12 months. The ‘Actual ROI’ has come in significantly lower at 3.08%. Now the first thing to say is any platform that offers 12.00 – 16.00% potential returns is inherently high risk as the borrower would paying an interest rate of 20.00 – 30.00%. Part of the reason the return figure is so low is because I’ve chosen to withdraw most of the repayments given a slightly skewed figure based on remaining problematic loans. That said approximately 50.00% of the loans I lent against are gone overdue some of these are in default with little prospect for recovery. Most of the income has been generated by selling the loan parts early at a discount which has also applied downward pressure on returns.

Funding Secure boasts total lending of in excess of £290,000,000 up to the end of these 12 months, with active investors (which it calls members) in excess of of 5000.

Conclusion

So although it looks bad I’m still refining my approach to lending with Funding Secure and I think an improved strategy could deliver  more worthwhile returns. For now Funding Secure will remain active in my portfolio in measured way while I continue to experiment, but i’m under no illusions it will be one the highest risk platforms in my portfolio.

Lendy – 18 Month Results

18 month review

I have got to 18 months lending through the Lendy platform and the results are follows –

Expected ROI (Annualised) 11.50%
Actual ROI (Annualised) 2.39%

In my previous Lendy review ( Lendy Results – 12 Month ) I was quite critical of Lendy and made clear that if things did not improve that they would not continue within in my portfolio. I’m afraid things have not only not improved they have got considerably worse.

The ‘Expected ROI’ is taken from the average headline return of the loan parts I hold. The ‘Actual ROI’ is what was achieved over the previous 12 months and at 2.39% theres is clearly something seriously wrong with this picture. It should be repeated that I only hold a remnant of ‘bad/unsellable’ loans with Lendy so the the returns should naturally be underwhelming, that said all of remaining loan parts are overdue payment some approaching three years. Total recovery on these problem loans has been less than 1.00% of balance over the last six months, which is pitiful.

Lendy and approximately 5000 lenders are now also facing legal action via one particular borrower for substantial damages, this is a live legal action so i can not comment on the merits of the claim, but all I would say is nobody saw this coming or even considered this a possibility. Further to this it would appear Lendy have actively attempted to manipulate review sites by not only removing even slightly negative reviews within minutes of posting but also replacing them with very dubious positive reviews that read as if the poster has little internal knowledge of the platform (ie.possibly paid for reviews), unfortunately this can’t be proved unequivocally without access to internal databases, which of course will never happen, but I think the damage to integrity with the lender base who are aware of this situation, has already been done.

 

Conclusion

It’s looking very bleak for Lendy and it’s difficult to see how it will ever turn things around and rebuild trust with it’s lender base. Lendy unfortunately seem to have viewed it’s lender base with absolute contempt over the last 12 months. I have made the firm decision to no longer invest with Lendy and as a result all referral links with-in this blog have been removed. Even if Lendy miraculously recover the outstanding funds and return to a double digit projected annual return over the next 3 months there is no-way I will return (at least under current management) as their integrity, in my eyes at least has been destroyed. I will still continue to report on Lendy every 6 months while a balance remains outstanding but only in the capacity of a recovery.

Funding Circle – 18 Month Results

18 Month Results

The results for lending through Funding Circle over the past 18 months are as follows –

Expected ROI (Annualised) 7.20%
Actual ROI (Annualised) 8.23%

The ‘Expected ROI’ is taken from Funding Circles own marketing material. The ‘Actual ROI’ has come in significantly higher. The ‘Expected’ figure takes into account a predicted level of defaults, I only had one loan part in the 18 months ‘downgraded’. This meant the loan part in question issued a warning of possible problems with repayments, despite this the loan part still made and is continuing to make repayments, so I think I have lucky with my account performing above average, which explains why I’m currently running over 1.00% above Funding Circles own predictions. This of course is likely to change as loan holdings mature and the likelihood of missed repayments increases.

The other big news for Funding Circle in this 6 month period since the last results, is the conformation of it’s IPO. Due to launch in October 2018 this IPO is highly anticipated as being the first P2P company to IPO in the UK. Other IPOs for P2P companies have previously taken place on the other side of the pond with concerning results. Lending Club IPOd in 2014 with it’s share price dropping 30% within weeks, in now trades (09/2018) at a huge 85.00% discount on IPO price. A similar pattern is being expected by many financial analyst for Funding Circle.

To conclude Funding Circle is doing more than enough in both terms ‘Actual Returns’ and future prospects of continued returns to maintain its position as an integral part of my portfolio.

Assetz Capital – An Introduction

Introduction

Assetz Capital is a P2P lending platform offering both property and business loan opportunities. Founded in 2012 it’s total lending to date is now in excess of £350 million. The minimum deposit for Assetz is £10 with a minimum loan part of £0.01. Deposits are made by bank transfer only and usually clear within 3 business days. Loan terms are generally between 12 and 60 months.

 

Assetz offers 5 different accounts to customers

Property Secured Account (PSA) – Target rate of return 5.50% per annum, monies secured against a fund of UK based property loans. Monies are auto-assigned and withdrawal is only available on the condition of a buyer being available at the time.

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30-Day Access Account (30DAA) – Target rate of return 5.10% per annum, monies are auto assigned to both business and property loans but require 30 days notice for a withdrawal dependant on market conditions. This account is also backed by a discretionary provision fund.

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Quick Access Account (QAA) – Target rate of return 4.10% per annum, monies are withdrawable (to your cash account) immediately depending on market conditions. Funds are lent against both UK business and property loans.

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Great British Business Account (GBBA) – Target rate of return 6.25% per annum, monies are auto-invested exclusively in to British Business loans. This account is also backed by a discretionary provision fund, withdrawal times can vary widely dependent on market conditions.

screen shot 2019-01-05 at 20.02.23

 

Manual Lending Account (MLA) – Available rate of return up to 10.00% per annum, this is a traditional self select account, you choose the deal you want to lend to and how much you want to lend. Loans are available to both UK business and property.

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The Assetz accounts also offer a ‘Cash Sweep’ function. This means you set any usassinged monies to be swept in to the ‘Quick Access Account’ earning the target rate of 4.10% per annum while you wait for repaid funds to build before making a new investment using the funds from the QAA,  minimising cash drag.

Assetz are also authorised to offer an IFISA option meaning £20’000 can be invested a year tax free. Assetz Capital are fully regulated by the FCA.

We Lend Us – 6 Month Results

6 Month Results

The first results for the first 6 months of lending through the We Lend Us platform are as follows –

Expected ROI (Annualised) 12.00%
Actual ROI (Annualised) 6.70%

It’s not been a bad start to my lending journey with We Lend Us. The expected ROI is the average of my lending setting for my required return. The actual ROI might not look too good in comparison but in this time I adjusted my portfolio allocation meaning I lost one months provision fund (PF) payment on the balance. Had i not made the adjustment the ROI would have been c.8.00%. What i did find a little frustrating was there was no reference to this loss of PF payment as a result of such amendments on the site (at least at the time), I also emailed to query this lost payment at the time and received no response. As I direct result I allocated funds elsewhere in the following few months.

My We Lend Us return is on track to grow to double digits for the full year and could prove to be one of the strongest performers with-in my portfolio. When i started with We Lend Us their entire loan book totaled £32,000, by the end of month 6 this had grown to c£700,000. We Lend Us made an announcement recently that the Provision Fund Purchase Delay would be set to 35 days as of mid January 2019 for everybody, this is significantly more than my current setting and I await the impact this move will have on returns over the coming months.

So in conclusion, despite the minor communication issue I am still relatively happy with We Lend Us and look forward to future growth in 2019.

Ablrate – An Introduction

Introduction

Ablrate was established in 2014 as business focused P2P lender. It offers asset backed loans in property, capital equipment and eco- projects. The minimum initial deposit for Ablrate is £100 (via bank transfer only) with a minimum loan deposit of £1. Loans are either ‘interest only’ or ‘amoritising’. Ablerate advertises a lender return of 10-15% annualised. Ablerate is fully authorised and regulated by the FCA and gained its IFISA permission from HMRC in August 2017.

Ablerate also offers a secondary market place for early loan part disposals. It works on a premium/discount offering meaning a seller can sacrifice some interest rate while a buyer picks up a higher interest rate to reflect the risk exchange.

 

Ablrate dashboard 

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The Ablrate Dashboard

Ablrate has a modern, clean looking dashboard that displays everything you need to know about your current portfolio.

The top box – shows a headline figure for any new loans available on the platform, clicking browse now will take you a details page.

Cash Balance box – shows any unassigned funds as ‘Funds Available’ these can be withdrawn immediately (minimum loan assignment is £1 and in whole pounds thereafter). This box also shows your ‘Total Fund’ balance. This is all of your active loans plus ‘Pending Loans’, plus ‘Funds Available’ on Ablerate.

Invested Funds box – this is your balance currently assigned to active loans, any balance assigned to loans not yet activated is shown as a separate figure under ‘Pending Loans’. Ablrate do not pay interest on ‘Pending Loans’.

All Interest Earned box – shows your interest to date. This figure can be a little misleading as it includes interest earned on held loans, cashback and interest on sold loans, hence why the figure does not tally up with the total funds balance. This box also includes ‘Next Payment Date’ and ‘Next Payment Amount’ while this is a handy metric, unfortunately if you experience a non payment on a loan the figures get stuck until that late payment is made, making the figures next to useless.

Secondary Market box – this displays any bids or offers you currently have on the secondary market place. When you bid (to buy) a loan part your bid is entered into a list with most attractive bid ranking highest. The same is true when offering a loan part for sale. The quicker you want to sell or buy loan part the closer you need to be to the best either offer or bid. If you don’t mind waiting for your bid or offer to be matched you can set it a little further away from the optimum meaning you can protenital make a better return for waiting a little longer. As with all secondary market places sale availability is subject to market conditions.

 

 

 

 

Lending Works – 12 Month Results

12 Month Results

The first full year of lending through the Lending Works platform are as follows –

Expected ROI 6.00%
Actual ROI 5.36%

The ‘Expected ROI’ for Lending Works is taken from the stated return for a 5 year deposit, which has remained at 6.00% for this period. The ‘Actual ROI’ for these results has seen a slight upward revision, from 5.24% ROI to 5.36% ROI. This upward trend was expected as the 5 year rate was increased in month 4 as discussed in the previous results. Even so i would have expected the ‘Actual ROI’ to be a little closer to the ‘Expected ROI’ after this period. So it leads me to believe that were probably late payments or even defaults on the loans i’m assigned to. Of course Lending Works being an entirely ‘Black Box’ platform there is no way of knowing this as you are given no specifics on where your money is actually lent, other than UK loans.

Total loans on the Lending Works platform have increased in the 12 months by 53% from £85 million to £130 million, making it a substantial player in the P2P personal loan type sector. This year is shaping up to be Lending Works lowest bad debt rate since its inception which is impressive for a company of this type and scale. Rate currently 0.1% however we are only 9 months in to this year so this figure might rise when more defaults are written off by the end of the year. Interestingly the borrower APR has increased in 2018 by 2.00% to 11.2% meaning borrowing is more expensive, although it doesn’t seem to have slowed demand.

 

Conclusion

I am perfectly happy with the Lending Works platform at this time and the rate of return I am reviving. I do not intend to withdraw any funds in the short term, in fact quite the opposite, I will continue to grow my deposit over the next 6 months.