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Thursday, 16 July 2015

Saving Stream, Peer to Peer Lending Paying TWELVE PERCENT (12%) !

No fees
Secured Loans
Contingency Fund

Too Good to be True? 

You might think so but their track record to date is pretty good.  There have been no defaults so far.  It’s well worth checking out what other lenders think by visiting the ‘Peer to Peer Independent Forum’ (you can find the link in the column to the right of this post).  There is a specific area of the Forum dedicated to Saving Stream.

A lot to Like

There is a lot to like about Saving Stream.  The platform is very simple and straight forward.  It reminds me of the Ronseal Ad, ‘It does exactly what it says on the tin’.

Minimum investment is £100 and minimum investment per loan is also £100.  Loans are typically bridging loans for property, interest only and are 6-12 months in duration.  The short term means that your money isn’t locked away for long periods.  The 12% interest rate is fixed for every loan so effectively they have averaged out the rate to keep the platform simple.

Secondary Market

There is a secondary market where you/buy sell at cost (ie no markup or mark down).  In practice, with the 12% rate, there are not many sellers.  The secondary market offers a mechanism to spread your risk across existing loans.  You’ll find new loans disappear fairly quickly.

What If?

One thing to remember about asset-based loans, if the worse happens, a default, then you won’t get your money back for some time as the asset will need to be sold.  You are also relying on the valuation being accurate.

I would recommend Saving Stream, based on my experience so far, but do weigh the risks and spread your money both between loans and across other platforms!

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