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Collateral promoted, Wellesley & Co relegated
There are numerous metrics to gauge the growing success or falling favour of a peer-to-peer platform, including loans arranged, current loan book value, reviews or industry awards. How often a company is mentioned in the press or discussed can also be an early indicator. The P2P Independent Forum has discussion boards for all of the major peer-to-peer companies in the UK and Europe and it has been good at predicting the rise of new companies, as well as highlighting often overlooked issues.
The P2P Independent Forum had taken the decision today to promote new company Collateral to the main discussion board. Collateral launched in May 2016 and as such is one of the newest peer-to-peer companies operating in the UK today. It facilitates short to medium term loans secured against assets, and provides a 12% return.
Below is an explanation of how Collateral works, taken from their website:
We secure loans against professionally valued property and other items of value.
Collateral is a Peer-to-Peer investment platform which provides investment opportunities for investors to invest in pre-funded short to medium term loans, secured against assets.
Peer to Peer lending, also known as P2P lending allows investors to finance loans against items of value, development projects and property purchases. Collateral ensures this process is fast, efficient, transparent and secure, and delivers a fixed interest rate of 12% per year. All proposals are fully assessed and fully funded by Collateral before being made available for investment on the platform; this ensures that your invested capital starts to earn interest immediately.
Loans are secured either by taking possession of the items loaned against, or with property loans, with a legal charge. Loan amounts do not exceed 70% of the Open Market Value. This means that in the event of a default there is sufficient equity to allow loan funds to be recouped with the sale of the security.
Collateral takes the place of Wellesley & Co which has been relegated to a sub-board, primarily because lenders were no longer discussing them. Forum members stated that Wellesley & Co's latest interest rate reduction for 1 and 2 year loans of 2.25% or 2.35% respectively was now uncompetitive.
Since launching in November 2013, Wellesley & Co has been extremely successful, having arranged over £345million in loans. Wellesley & Co has a current loan book of over £140million which makes the peer-to-peer company the fifth biggest in the UK, using statistics compiled by P2P money. Due to this success the company may have needed to reduce interest rates to cope with an over-supply of money.