Zopa

[Republik]

http://uk.zopa.com/ZopaWeb/

I'm interested in knowing more about getting into this as a lender. With returns of 9.1% its better than any bank right now. Has anyone researched into it before or is even a borrower or lender themselves?

How does it work? How risky is it and what happens if the worst happens to the person you lend to?

Any background info would be much appreciated.

[Bing o]

Bizarre

http://www.pistonheads.co.uk/gassing/topic.asp?t=6...

[Republik]

Great minds!

I see you got as much response as I'm getting!

[Bing o]

Indeed, a work colleague has just punted a G in there - no-one wants his cash!!

Will see how he gets on longer term.

[AlexKP]

On the face of it, how astonishingly simple and yet clever.

Like all the best ideas.

[Bing o]

anonymous said:

[redacted]

But that's the question - how safe is the cash?

They reckon they vet their clients, but does it not look a bit like what happened in America - putting risky dept in with "safe" debt to make it look less risky?

[CoopR]

I'm borrowing a smallish loan from them at the moment and once I'm repaid I'm considering sticking 1 or 2k into it as a lender.

It's difficult to judge due to the weird interest rates going around at the moment but I got 8.9% as a A* borrower and was pretty happy with that. I'd imagine if you lend to slightly more risky groups then the 9.1% average would be easy to hit.

One good/bad thing is the no early repayment fee's, good for me because I'm planning to pay off mine in ~6 months instead of 36. Not so good for the lenders.

I do like the way your risk is spread when lending, my loan is actually something like 300 separate loans of between £5-50.

Edit: I had to do an Experian credit check, list my monthly incomings and mortgage payments then got a phone call later where I had to confirm things like my outstanding mortgage balance. not foolproof but I don't think they're pulling any subprime stunts and as a lander your able to decide exactly which gorups you lend to.

Edited by CoopR on Thursday 26th February 13:30

[Dakkon]

As I said on the other thread it is not quite so straight forward as the adverts suggest, they group borrowers in to risk groups and it is up to you who you lend to obviously the higher risk groups are in theory less likely to pay back the amount borrowed but you are charging higher interest on the loan.

Given interest rates in a lot of savings accounts currently it is worth a go.

[Spiritual_Beggar]

Looks quite interesting.

I take it it's for small personal loans? Not large commercial loans (e.g.: £1-2 million. etc)

[Republik]

I think the max is £15k

[CoopR]

Yea <15k loans only.

[AlexKP]

I think the key to this is that you aren't lending directly to one borrower - but sharing any risk amongst many.

Seems pretty smart to me, but then I'm not a financehead.

[Republik]

I'm quite keen to know the ins and outs. If say I invest £5k, am I likely to get monthly payments from the lenders straight into my account?

[BlueEyedBoy]

I'd be interested to know how the tax will work......

[hornetrider]

Jesus, are you all fools? The high returns are indicative of the level of risk. This is the kind of approach that has got this economy fked.