A £100 bonus for the first £1,000 invested has tempted The Secret Investor to allocate some capital to Lending Crowd… The continuing speedy funding of loans on Funding Circle has caused The Secret Investor to make some hasty moves – he hopes to sell some of his poor choices on the Secondary Market.

Totals lent to date (15th October 2015)

*All data correct at the time this blog was compiled

LOANS TO BUSINESSES

Assetz Capital – £82,183,044
Funding Circle - £887,497,400
FundingKnight - £25,049,500
FundingSecure - £14,584,493
Money & Co –  £6 million approx
Rebuildingsociety - £8,499,925
ThinCats - £135,179,000
Invest and Fund - £1 million plus
LendingCrowd - £1.25 million plus
ArchOver - £8,015,000

PERSONAL P2P LENDING

Zopa - £1,130,000,000
RateSetter - £857,050,062

Lending Works - £15,706,734

…………..

LOANS TO BUSINESS

Assetz Capital  

Lent to Date: £82,183,044 – increase of £325,000.

7 loans currently require funding. A further 8 are upcoming with returns from 9% to 12%.

3 managed accounts protected by provision funds with returns of 3.75% to 7% depending on accessibility.

Highlighted Loan: A 5 year loan of £325,000 to buy a public house is due for drawdown in late November with a return of 9.5% pa. Rooms are going to be furnished to provide rental income. Security is provided by legal charges on 3 properties, a personal guarantee and a charge on the borrower's construction business.

Platform News: The AssetzCapital website has undergone a revamp to make it more user friendly. There are introductory videos aimed at new investors while each of the 3 fixed rate accounts are explained more fully.

Funding Circle

Lent to Date: £887,497,400 – increase of £21 million in the last fortnight which is near enough identical to the previous 2 weeks. It is interesting to note that this has not reduced because, conversely, the number of loans listed was on a gradual downward trend for 3 weeks on the bounce although things recovered during the fourth week in this period. The increase in offerings was for A+ and B categorized loans which is not much help for "rate tarts" such as myself who are only interested in the high yielding risk bands.

Time for a rethink: Not so long ago, as repayments came in from Funding Circle investments, I was able to bid on new loans as soon as I had more than the minimum bid amount of £20 (this was almost a daily event) but the reduction in available opportunities on this site has led me to get anxious as funds have built up and I have been unable to find a home for them. This has caused some hasty decisions.

Just after the last blog went to press I picked up D and C Band loans (one of each). These higher rated loans have been so quick to fill that I probably dived in too soon.

The D rated offering was for £150k to enable a healthcare consultancy to expand. I committed to it as soon as I saw it but 100% funding still hadn't been reached three days later and the Q&A had many questions as to whether the business was growing too rapidly. Meanwhile the C rated loan was to assist a chain of Beauty Salons with the opening of a new location. I am a little more confident with this one as the "bet" is on whether the latest branch will be a success and whether the guarantee can cover the loss should it fail.

Almost a week later and I had been unable to re-invest any of my repayments as all the D and E rated offerings filled up immediately. With the exception of FundingSecure where October's P2P capital injection was still being distributed, no other sites that I am active on listed anything new so, reluctantly, I delved into the FC Secondary Market where I distributed the funds accrued across some E risk band borrowers. These included a builder's merchant who had hit some trading problems recently when major roadworks took place outside his premises which caused many customers to go elsewhere. I am hoping that these problems were a factor in the high risk band and the underlying business is better than the figures show.

The day after this raid of the Secondary Market, FundingKnight announced a couple of new loans which could have provided a home to my funds had I waited a little longer... and then two large D rated loans with a fixed rate of 14.1% appeared on FC when I logged in during Saturday morning. Neither had been fully funded but, after my mad half hour on the SM, my funds on this platform had only recovered enough to be able to invest £20 in one of them!

I think I need to return to the Secondary Market as a seller to offload the poor buying decisions I have made and transfer funds elsewhere. I must return to the strategy that has brought me so much success where I carefully choose who to lend to.

Loan defaulted: As the borrower had not been contactable after going into insolvency back in August, FundingCircle have set one of my loans to default. Only 5 repayments had been made so it's my biggest single loss although due to the low amount I put in any individual loan the figure is only £70.

I mentioned last week that the amount defaulted against my FC account was less than the fees paid. That situation has been reversed by this week's bad debt although it is still quite a close run thing.

Platform news: FundingCircle have made an amendment to how AutoBid works. When a loan is first listed it can be filled up to 50% by the passive investor's friend then after 2 days, if 100% of the capital has not been raised, AutoBid kicks in again. So, if there are enough funds ready to be auto-allocated, active investors only have 2 days to do their research and, hopefully, get answers from borrowers.

FundingKnight

Lent to Date: £26,118,000 – a very quiet fortnight with an increase of just £368,500.

There were 4 auctions taking place when this blog was compiled although 3 were due to end on Friday, 30th October.

Highlighted Loan: The fourth offering which should be available until next Wednesday is to enable a jeweller to complete the buy-out of another company and to consolidate an existing Funding Circle loan by raising £200,000. This has a reserve interest rate of 10% pa.

FundingSecure

Lent to Date: £14,584,493– Figure updated at the start of each month.

While there were no auctions taking place when this report was compiled, several are listed each week. Two are scheduled to appear on Friday, 30th October – knowing the popularity of this site, they won't be there long!

Highlighted Loan: You never know what your capital is going to be secured against on FundingSecure. This week £14,000 was borrowed against an Industrial Wrapping Machine valued at £35,000 with a return of 13% pa.

I wasn't sure how easy this piece of hardware would be to sell should the lender get into financial difficulties however that concern became irrelevant when I came home from work to discover the loan had reached full funding just over 2 hours after it went live.

One down, many to go: My first investment to reach the end of its 6 months term matured this week. The loan renewed and so only the interest was paid but at least my capital immediately went back to work. The loan is to restore a classic car and hopefully there will be no problems paying back the loan once the build is complete and the vehicle is sold.

Money & Co

Lent to Date: £6 million approx. (latest available figure) 

There were no auctions taking place when this report was compiled.

rebuildingsociety

Lent to Date: £8,499,925 – increase of £343,000 in the past fortnight.

This was one of busiest 2 weeks in the past few months.

A couple of auctions were taking place when this blog was compiled.

Highlighted Loan: A new loan for £40,000 has appeared for a firm of consultants working in the oil industry who are looking to expand Globally due to the declining UK market. The borrower gave a detailed breakdown of their expected income over the next few months and it tempted me to invest at 16% pa.

Platform News: ReBS are going to demonstrate the confidence they have in all the borrowers that are accepted on the platform through their "New Catalyst" initiative which will involve the site making a first bid of £1,000 on all loans when they are first listed. This will get things moving but is at a low enough rate to be easily outbid if enough investors fund the offering to 100%. Should they not be outbid, ReBS will immediately put their share up for sale at a rate 1% below the maximum for the loan.

Earlier this month ReBuildingSociety introduced a new Affiliates Programme. As part of this, a referrer earns a tenner when the person they referred registers and verifies their identity. This is topped up to £50 once they have lent more than £1,000.

ThinCats

Lent to Date: £135,179,000. It has been a comparatively quiet fortnight for this site with a growth of £815,000. 

9 loans are available to invest in.

Highlighted Loan: A TV Production company are looking to raise £150,000 with a target rate of 12% pa. This is working capital to produce content which will be sold to TV Networks on a pay on delivery basis. It's the eighth loan the business has taken out with ThinCats. They have a total value of £1.4 million however the back catalogue of programmes offered as security has been independently valued at £5 million.

Invest & Fund

Lent to Date: Over £1 million

The site listed 3 auctions when this blog was compiled but all were 100% funded.

LendingCrowd

Lent to Date: Over £1.25 million in total

There are currently no loans available which is a shame as, having highlighted that this platform is offering £100 to any new investor that lends out £1,000 before the end of November in my last blog, I signed up and deposited the required amount. Having got involved in 2 of the 3 auctions which were available at that time and divided my funds across the secondary market, I am the equivalent of about 4 loans away from reaching the required target to receive my bonus. If no new auctions appear over the next few weeks, I shall have to return to the Secondary Market.

ArchOver

Lent to Date: £8,015,000 – increase of £380,000 in the past fortnight which takes the site over the £8 million mark.

Highlighted Loans: A company providing IT support to corporate events are looking to raise £200,000 to support their on-going expansion. Security is provided by a first, floating charge over Accounts Receivable and the loan is also insured. This level of security means the return is one of the lowest in this section of the blog at 6.75% but the low risk is confirmed by the fact that no loans have defaulted on this site. 

PERSONAL P2P LENDING

Zopa

Lent to Date:  £1.13 Billion – increase of £30 million in the past fortnight

Returns: Interest rates are 3.8% to 5% depending on the length of the investment. These are unchanged from a fortnight ago.

Capital is covered by a Provision Fund

Ratesetter

Lent to Date: £857,050,062 – increase of £23 million in the past fortnight which is the same as the previous 2 weeks.

Returns: Interest rates are set according to supply and demand. They currently range from 3.1% to 6.1% depending on the length of the investment. I have some capital invested in 5 year loans on this site and my repayments have been auto-reinvested consistently above 6% for the past few weeks. In recent months, that figure has been almost 1% lower.

Although rates remain at broadly the same level from month to month, certain trends have emerged. The monthly cycle sees the best returns around the 25th of the month. Within this, rates also vary on a weekly basis. They rise during the weekend and into Mondays then reach their lowest ebb on Wednesdays and Thursdays.

I just don't have time to track the Ratesetter market in this much detail and, as investors have no choice in who their funds are lent to, I am happy to use the AutoBid facility on this platform especially as it is historically low risk.

Capital is covered by a Provision Fund. Ratesetter proudly boast that no investor has lost a penny since they launched in 2010.

Lending Works

Lent to Date: £15,706,734 – increase of £0.75 million in the past fortnight.

Returns: 4.8% and 6.1% for 3 and 5 year investments respectively – these are unchanged from a fortnight ago.

As well as a Provision Fund to cover investor's funds, this site also insures borrowers against redundancy, fraud, illness and accidents making this a very fair site for all concerned.

****Disclaimer: This blog contains the views of the Secret Investor. Your capital is at risk when lending via all P2P Platforms. You're recommended to speak to a qualified Independent Financial Advisor.