baldpate
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Post by baldpate on May 27, 2015 17:54:03 GMT
I registered with this platform a few weeks ago, and placed some money on deposit. I watched the auctions for a couple of weeks, but didn't bid. Eventually I withdrew my money (no problem with withdrawal), as I concluded the platform wasn't for me at the moment. The auctions I watched were all progressively filled with the help of large bids from a single user. These bids were invariably made at, or slightly above the minimum permitted rate for the loan's risk band. This behaviour leads me to believe this must be the 'in-house' bidder to which kaya refers, since the bidding pattern is consistent and seems designed to fill the loan whilst leaving space for other bidders at higher rates. Since there are very few other active lenders, the auctions are dominated by the low bids from this lender. The maximum permitted rates per risk band are reasonable for the projected default rates & platform risk. There were a couple of things I was unhappy with: (1) Although there is a secondary market (sale at par only) it is swamped with parts at the minimum rate (presumably those of the 'in-house' bidder?). So although one can readily acquire loan parts in the primary market (PM) at good rates, it seemed to me there would be effectively no way to sell them on the secondary market (SM). This problem will persist until there are enough true bidders to make the PM auctions competitive (allowing the 'in-house bidder' to withdraw) AND the minimum-rate ovehang in the SM has been bought or withdrawn. I consider an effective & liquid SM an essential feature for any platform offering this type of loan. (2) I asked of the support staff how much time borrowers were allowed, after auction close, to accept or reject a loan : and, if the loan was accepted, when interest starts to accrue. I was told that the borrower was allowed a week to decide, but were then allowed a further 14 days 'cooling-off' period. As I understand it, this means the loan isn't completed (drawn), and interest doesn't start to accrue, for at least two weeks, possibly three. This isn't how it works on other platforms that I know of (e.g. Funding Circle and Rebuilding Society) where the loan is incepted and interest accrues just after the scheduled auction end, however long it takes the borrower to to accept and to complete the paperwork : this incentivizes the borrower to get a move on, and ensures my money is earning as soon as possible. I will continue to watch this platform and I may return to it in future : the quality of the (small sample of) loans I saw seemed reasonable, and the site itself was clean and easy to use, but the issues I mention above would need to be resolved first. If I have misunderstood what I saw or misinterpeted what I was told, I am happy to be corrected. Perhaps the representative of Lending Crowd would care to comment?
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baldpate
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Post by baldpate on May 28, 2015 14:46:40 GMT
Loan drawn down at last and interest starts from auction close.Hi Jaydee, that's interesting. May I ask if the loan in question is "C****e M*******s UK", whose auction closed on the 15th May (so about right for your 13-day wait)? If that's the one, then if you look at the repayment schedule tab for that loan, it should be saying that the first repayment is due on 15th June (or maybe 16th June) - is that what you are seeing? If so, it looks as if I may have misunderstood what Lending Crowd were telling me.
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kaya
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Post by kaya on May 29, 2015 10:35:29 GMT
Although I have not tried selling a loan part, I would have thought that liquidity would be quite good, provided you have bid above the rate that mostly fills the loan. There is a selling fee though, and indeed annual fees also, along FC lines - probably not a great idea for a new platform wanting to attract new customers (compare FK,FE, & Rebs). Most important thing is the quality of the businesses receiving the loan, and it is reassuring to see someone willing to back them - though presumably they can afford the risk of default. Interest rates are not always attractive, but as mentioned above, space is presently being left for some bidding at higher rates, athough higher bids are sometimes outbid anyway. Still, good rates are often achievable, which overall probably makes it worth a punt. It would be nice to see a schedule of loans with nice clean and tidy repayments. See how it goes.
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Post by lendingcrowd on Jun 12, 2015 15:51:39 GMT
Hi again,
Thanks for the feedback everyone. We are still quite a small company as we only launched in October last year and of course we are going to have teething problems like any new company. We truly value the feedback you are giving us and it will be taken into consideration when we make further changes to the platform.
With regards to the interest accrual, the date of the first repayment is set in consultation with the Borrower, who can choose their first repayment date (no more than 6 weeks after the funds are drawn down) - the interest will start accruing a month before this first repayment date. This date will only be set once the loan offer has been accepted (within a maximum of 5 days after the loan auction has closed) and the paperwork has been received (there is a 10 day maximum for this). This means that the repayment date may be set up to 15 days after the loan has closed. The point at which the interest starts accruing is therefore determined by how quickly the Borrower accepts the loan and completes all the paperwork.
The Borrower is allowed to choose (within a 2 week window) their repayment date so that it fits in with their cashflow - this minimises the chance of the Borrower defaulting on their loan.
Our Credit team assess every business application on a case-by-case basis, and although the team is small they have a combined 100 years of credit experience. We are trying to ensure that only high-quality loans are put on the Loan Market for investment, and that we can therefore keep our bad debt rate as low as possible.
We welcome your comments about the platform and will use them to improve the experience we offer to both investors and borrowers.
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baldpate
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Post by baldpate on Jun 19, 2015 18:56:39 GMT
A question for lendingcrowd : do you publish any statistics on the site (you know the sort of thing that other platforms do - total numbers and values of loans by risk band, incepted & defaulted etc)? I have searched diligently, but can't find anything. Or do you have concrete plans to do so?
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Post by lendingcrowd on Jun 24, 2015 13:54:01 GMT
Hi baldpate,
Thanks for your question. We don't currently publish these statistics but it is something we have in our roadmap and we intend to create a statistics page in the near future.
However for the moment these are our up to date statistics as of the 24th of June 2015.
Default Rate to date - 0%
Risk band A+ total loans 1 total lent £53,500 Risk band A total loans 9 total lent £425,000 Risk band B+ total loans 5 total lent £403,000 Risk band B total loans 4 total lent £165,000 Risk band C+ total loans 4 total lent £172,400
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baldpate
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Post by baldpate on Jun 25, 2015 9:37:38 GMT
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Post by lendingcrowd on Jun 26, 2015 9:08:28 GMT
No problem baldpate. If we can answer any questions that you or any other members of this forum may have about LendingCrowd please ask. We are happy to answer.
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Post by GSV3MIaC on Sept 10, 2015 17:00:00 GMT
Hmm, let's try you out then (following the FC 'shooting themselves in the foot' debacle) ..
1) Do you have any PLANs to have markup/discount sales on the SM (pros - it helps liquefy the market - cons, it makes it a happy flipping ground). There is no right answer, we'd just like a heads up, transparency wise.
2) (maybe this is answered if I go peer at your site, but asking here is easier ..) .. how about 'dynamic bidding' .. i.e. the ability to say 'yeah, put me down for £x00 on this one, at 18%, but if that's knocked out I'll rebid all the way down to 15% (in whatever the stepsize is) and then I'm out. I hate having to log in every 5 minutes to check and re-enter bids (or to write a bot to do so), but not as much as I hate buying a loan at 15% when I could have gotten 18%. [are you listening ReBS!]. 8>.
3) Could you swear on the odd stack of bibles/korans (pick one) that you are going to be able to make actual auctions work, and not flap your hands and walk away as FC just did?!
4) OK, so you have a big backer willing to underwrite loans (at the lowest rate, which makes me think you ain't got (2) yet) .. but what is your stance on influx of masses of institutional money, and associated leverage (yes yes, we know you'd like to have it, but 'crowd' to me implies a bunch of we small-ish fry, as opposed to 'crowded out' by the odd whale.)
5) Assuming you don't crash and burn, at some point we will definitely want debit card payments as an option (pushing it from a bank account is just a lot of hassle).
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bjorn
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Post by bjorn on Sept 10, 2015 18:44:26 GMT
2) (maybe this is answered if I go peer at your site, but asking here is easier ..) .. how about 'dynamic bidding' .. i.e. the ability to say 'yeah, put me down for £x00 on this one, at 18%, but if that's knocked out I'll rebid all the way down to 15% (in whatever the stepsize is) and then I'm out. I hate having to log in every 5 minutes to check and re-enter bids (or to write a bot to do so), but not as much as I hate buying a loan at 15% when I could have gotten 18%. [are you listening ReBS!]. 8>. Hear hear. When I first looked at p2p lending auctions I was expecting this would be how they'd work and was surprised that it wasn't a feature. After all, the auction model everyone is most familiar with is eBay and they've been doing this (albeit the other way round - bidding upwards to a maximum) for yonks.
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Post by biscuitbri on Sept 11, 2015 12:50:24 GMT
Reference paying in money, they give you a choice of transfer or debit card - I used debit card, no problems. Hope you get answers to your other queries.
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Post by lendingcrowd on Sept 11, 2015 16:42:41 GMT
Hmm, let's try you out then (following the FC 'shooting themselves in the foot' debacle) .. 1) Do you have any PLANs to have markup/discount sales on the SM (pros - it helps liquefy the market - cons, it makes it a happy flipping ground). There is no right answer, we'd just like a heads up, transparency wise. 2) (maybe this is answered if I go peer at your site, but asking here is easier ..) .. how about 'dynamic bidding' .. i.e. the ability to say 'yeah, put me down for £x00 on this one, at 18%, but if that's knocked out I'll rebid all the way down to 15% (in whatever the stepsize is) and then I'm out. I hate having to log in every 5 minutes to check and re-enter bids (or to write a bot to do so), but not as much as I hate buying a loan at 15% when I could have gotten 18%. [are you listening ReBS!]. 8>. 3) Could you swear on the odd stack of bibles/korans (pick one) that you are going to be able to make actual auctions work, and not flap your hands and walk away as FC just did?! 4) OK, so you have a big backer willing to underwrite loans (at the lowest rate, which makes me think you ain't got (2) yet) .. but what is your stance on influx of masses of institutional money, and associated leverage (yes yes, we know you'd like to have it, but 'crowd' to me implies a bunch of we small-ish fry, as opposed to 'crowded out' by the odd whale.) 5) Assuming you don't crash and burn, at some point we will definitely want debit card payments as an option (pushing it from a bank account is just a lot of hassle). Hi GSV3MIaC, This is Stuart, co-founder and CEO of LendingCrowd. Thanks for your comments and please see my responses below. 1) We specifically designed the secondary market (Loan Exchange) without premium and discount as despite some well-documented advantages, it does seem to cause confusion for some investors on other platforms. We believe that simplifying the Loan Exchange is key to improving liquidity in the longer term. 2) We don’t currently have that functionality but I like the idea! We do have automated emails to inform investors if they have been underbid/knocked out but dynamic bidding is something we could build if investors would like that functionality. Get in touch and let us know. 3) I can’t make any promises for the longer term but we like the bidding process. As is mentioned below, the co-founders of LendingCrowd are active investors on the platform and we enjoy taking part in the bidding, as do a large number of our investors. 4) The co-founders of LendingCrowd are determined to build an active investor base and in order to do so, committed to investing in each loan and then provide liquidity on the Loan Exchange. That means that we are able to provide better diversification for new investors than if reliance was only on new loans. The sector is evolving quickly and we are very conscious of the crowding out problem. However, some level of larger funding can be useful when originating deal flow (new loans) given the greater certainty of executing deals and can also allow platforms to offer larger deals that might not alternatively get fully funded. 5) As biscuitbri said above LendingCrowd does offer debit card transactions for investors. We are very excited about the momentum we are starting to build on the platform and are keen to build relationships with our investors. Please try out the site and let us know your thoughts. Stuart
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grahamg
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Post by grahamg on Sept 11, 2015 18:57:20 GMT
Hi does anyone understand how the loan exchange rates works.
Firstly i seem to be able to enter any value i want and it offers me a rate so clearly i am not purchasing real residual loan parts from other people
So what am i buying.
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SteveT
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Post by SteveT on Sept 12, 2015 6:23:49 GMT
Hi Stuart, 2) Dynamic bidding, Yes please! I hate to say it, but at the moment LC looks like another 'me too' P2P offering and being small I feel there is greater platform risk than the more established alternatives. An interesting and time saving USP of dynamic bidding might attract the lender base you want. Just for the novelty factor I'd give it a go! Another vote for dynamic bidding please.
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bjorn
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Post by bjorn on Sept 12, 2015 15:16:16 GMT
Hi Stuart, 2) Dynamic bidding, Yes please! I hate to say it, but at the moment LC looks like another 'me too' P2P offering and being small I feel there is greater platform risk than the more established alternatives. An interesting and time saving USP of dynamic bidding might attract the lender base you want. Just for the novelty factor I'd give it a go! Another vote for dynamic bidding please. lendingcrowd I'd be in massive favour of this too. As I mentioned above, something that works like eBay (but in reverse) would be great. As others have pointed out, this would be a clear differentiator and tbh it's slightly surprising that no-one else has done it yet. I see you have a mobile app in the offing but both from an investor's point of view and, I'd suggest, for your competitive positioning, I'd rank dynamic bidding a much higher priority for the product roadmap than a mobile app. Obviously those are your decisions to make, but given that you invited feedback ...
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