Two Years of Investing in Property Development Loans at Estateguru

estateguru-logo-2016Estateguru is a p2p lending marketplace in Estonia focussed on bridge loans to property developers in Estonia. Since the launch in 2014 Estateguru has facilitated a loan volume of more than 10 million Euro in a total of 65 loans. The loans are secured by 1st or 2nd rank mortgages. Typical interest rates range from about 9% to about 12%. Some of the loans pay monthly interest, while for others the interest is paid at the end of the loan term. The minimum bid amount is 50 Euro.

Estateguru provides appraisal reports for the security. Estonia is highly advanced in digitization – this allows Estateguru to provide direct links to the official records in the land register for the plot.

Estateguru loan example
Example of an Estateguru loan listing (shortened, click to enlarge image). There is more information about the loan, the security and the borrower in the other tabs

I have invested in a couple of loans over the past years and the handling is smooth. Two loans are repaid (one early) and the other loans are running on schedule. Other investors report that there have been no defaults yet, only some loans where the payment came in late for a couple of days (or a few weeks at max.). Unlike other platforms, Estateguru sends no updates about the loans.

Many investors keep some cash in the Estateguru account in order not to miss out, when new loans appear. Smaller new loans usually fill within hours. Investors can opt for a notification email, that is sent when new loans arrive. However tiny loans (< 40,000 EUR) are sometimes 100% funded by the time the email arrives. There is no autoinvestment feature / prefunding facility. Estateguru does not have a secondary market, but many loans are only for 12 or 18 months term.

Estateguru is open for investors from all over Europe (actually the EEA). If you are inside the Eurozone investments are fast via SEPA transfers. If you live outside you should consider using Transferwise or Currencyfair to avoid high bank fees and get a better currency exchange rate.

Bonus: If you sign up using this link Estateguru will credit you 0.5% cashback on all investments you make in the first 90 days.

Estateguru homepage August 2016
Screenshot of the Estateguru homepage

Mintos Reaches 50M Loan Volume Milestone

Mintos logoP2P lending marketplace Mintos crossed 50 million Euro in loans to both private individuals, as well as small and medium sized businesses after 18 months of operations. Mintos marketplace arranges loans from 14 non-bank lenders, which have joined the marketplace from the Czech Republic, Estonia, Latvia, Lithuania, and Poland.

According to funded loan volume, to date most money has flowed into loans in Latvia’s – 33%, Lithuania’s – 31% and Estonia’s – 23%.

‘All around the world, peer-to-peer lending concept is slowly replacing bank services from which the commercial banking sector is retreating. Today, banks no longer conduct the main mission of the financial system — connecting those postponing consumption with those who are consuming today, i.e. connecting savers and borrowers. Deposit rates are close to zero or even negative, while access to credit is limited. This increases the non-bank financial services market, which offers consumers easy, convenient and affordable services,’ emphasizes Mintos CEO and co-founder Martins Sulte, predicting that by year end, investors through Mintos will have financed EUR 100 million in loans. Continue reading

Interview – Finbee the First Year

P2P-Banking.com Interview with Laimonas Noreika, CEO of Finbee

You launched Finbee a year ago. Can you sum up the major developments since?

More than 3,000 investors have issued 2M EUR worth of loans via FinBee and none of them lost any money due to a default and our compensation scheme. We are very proud for this result.  We have a reliable and highly skilled team that has built a company that is constantly growing. We are in full legal compliance with existing regulation and are constantly working on developing new products and features for our investors and borrowers.

What were the biggest challenges in this first year?

P2P lending is a relatively new concept in Lithuanian lending market, so raising awareness and overcoming scepticism was one the biggest challenges that we’ve faced from day one. Also, when we started to expand, building a team that can deliver results while maintaining highest standards was also time consuming. From technical perspective, learning the dynamics of supply and demand in FinBee auction was also something that we put a lot of effort to.

finbee-team

In your opinion, which 3 most important skills does a CEO need to successfully lead a fintech startup?

In my personal opinion, a key feature that a CEO has to be experienced in is team building. Even the most outstanding CEO will not be able to achieve much without a great team. A great manager has to have a diverse experience in corporate governance, finance, legal matters, marketing and IT. Also, I would like to emphasise, that simple and transparent communication is vital for a CEO.

Are collection and default figures in line with the expectations & projections you had a year ago?

Current default figures are better that we expected and projected. We expected to operate with 8 to 10 percent of non-performing loans. Currently we have 2.25 percent (it worth noting that we consider a loan to be non-performing when two monthly instalments are missed, that is when loan is 60+ days late). We also project 40 percent recovery of non-performing loans. So we expect 4.8 – 6 percent losses after recovery. Having in mind that investors now invest on 26 percent interest rate on average, they can expect 20 percent returns even without our compensation fund.

We achieve this by minimizing the chance of default with wide range of measures. For example, we check every single borrower using more criteria than is required by regulation. Also, we meet each and every one of them personally. We confirm only 7 percent of loan requests and only then pass them to the investors. Continue reading

Silver Bullion Reports First Year Results for Gold & Silver Secured P2P loans

Silver Bullion Pte Ltd in Singapore reported today, on the anniversary of the launch of their bullion secured peer-to-peer(P2P) loan platform, that the platform has funded over S$11 million across more than 400 successfully matched loans. There were zero occurrences of borrowers defaulting on their loans. One hundred percent of lenders, with loan tenures expiring within the first year, received their principle with interest on time.

Launched on 5th August 2015, Silver Bullion offers a p2p marketplace that allows borrowers to obtain a loan using physical gold and silver bullion as collateral. This gives lenders, seeking a good rate of return, confidence that their investments are safe.

Silver Bullion’s CEO, Gregor Gregersen, commented: ‘The first year results of our P2P loan platform shows that owners of physical gold and silver like to have the option to be able to borrow short term funds at good rates with the bullion that they store with us. Now, they are able to reinvest with the borrowed funds whilst continuing to own bullion and benefit from rising gold and silver prices.’

P2P-Banking.com conducted an interview with Gregersen earlier this year.

silver-bullion-vaultDue to the safety that Silver Bullion’s loan platform gives to lenders, 72% of the matched loans were initiated by borrowers. The company has seen more than 30 loans matched consistently each month since March 2016 – a rate of more than 1 matched loan per day. Interest rates across all loan tenures currently hovers between 2.5% and 4.5% per annum.
Unlike unsecured P2P lending platforms, loans matched by Silver Bullion’s lending platform are fully backed by physical gold and silver. Loans with tenures longer than 6 months begin with a collateral-to-loan value of 200%. The exceptions are loans with the 1 month tenure which have a lower collateral-to-loan value of 160%.<

Borrowers’ collateralized bullion is stored at Silver Bullion’s vault, The Safe House. They are covered by one of the most comprehensive insurance policies in the industry that also insures against inside jobs and any unexplained losses.

 

International P2P Lending Marketplaces – Loan Volumes July 2016

The following table lists the loan originations of p2p lending platforms in July. Zopa leads ahead of Funding Circle and Ratesetter. Assetz Capital and Lendinvest achieved a big surge in volume. The total volume for the reported marketplaces adds up to 341 million Euro. I track the development of p2p lending volumes for many markets. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending services.

Investors living in national markets with no or limited selection of local p2p lending services can check this list of marketplaces open to international investors. Investors can also explore how to make use of current p2p lending cashback offers available.

P2P Lending statistic july 2016

Table: P2P Lending Volumes in July 2016. Source: own research
Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations.
*Prosper and Lending Club no longer publish origination data for the most recent month.

Notice to p2p lending services not listed: Continue reading