1. Home
  2. UK Finance Discussions
  3. Zopa

Zopa

Has anyone had any experience of borrowing on the Zopa markets?

formatting link

The reason I ask is because, to my displeasure, and after numerous emails from Zopa exhorting me to borrow at favourable rates of interest, my application to borrow a modest sum was considered for almost a week and then declined.

Zopa rated me as an 'A' borrower with a 502 rating. I have a credit rating of 504 on Equifax (used by Zopa), no arrears ever, oodles of equity, property worth > £400k, smallish mortgage, no credit card debts, regular full time employment, professionally qualified, not much borrowing at all. The rate on offer was 4.6% which seemed good over 3 years. I was going to use the money to pay off a small amount on my mortgage spent on property improvements some time ago. I sailed through the online application process and I was even allocated the money and given the names and locations of people who would be lending to me. After nearly a week and one quite puzzling phone call at my office when the caller from Zopa didn't seem to understand much about anything, I was emailed to say they were declining my application.

Zopa? It's a joke! If they won't lend to me who will they lend to? I am left wondering what the game is with Zopa. I suspect, after doing some research, that my application was declined because I did not want their credit insurance! No insurance = no commission for Zopa = loan declined? Any other experiences?

Reply to
SandalsMan
Loading thread data ...

Someoneo wants to pay a higher rate of interest.

As has already been analysed here, there are going to be few lenders at a rate that enables you to borrow at

4.6%. By the time Zopa have taken out their margin and the lender adds in the cost of lost interest on his 'void' period and bad debts, he can do better at a real bank. With the real bank he doesn't have to take the risk of dealing with an unregulated start-up company.

As a potential lender there is **** all reason for me to give any of my money to zopa. Lots of risk, zero reward for that risk.

It's a leveraged start up wating for some mug to come along and buy it out for Billions. (note lack of smiley)

As there is a 30 day colling off period this is easy to get around.

tim

Reply to
tim (in Sweden)

No, Tim, you misunderstand my posting. The money was there at 4.6% and the lenders were lined up, I had their names and locations! Zopa simply declined to lend based upon 'lending criteria'. I suspect it was more to do with the fact that I didn't take their credit insurance therefore they weren't getting any commission. Please re-read my posting!

Reply to
SandalsMan

Do you mean that you get told the names of the people lending/borrowing each of the 10 pound parcels? Amazing

They take a margin on the funds. They still get something.

You didn't state in that that they definately had the money.

tim

>
Reply to
tim (in Sweden)

Yes, their screen names anyway, which in some cases was real names in others a psuedonym. Some were 10 pound parcels whereas others were higher, up to £200 I seem to recall.

I don't doubt it. But I was debating why they declined my application, after having emailed me a couple of times to tempt me that funds were on offer at circa 4.6%.

Errr... sorry but I did! I said: "I sailed through the online application process and I was even allocated the money and given the names and locations of people who would be lending to me."

They said that the only thing remaining was credit checks (having already told me that my score was 502 on their own system). The gist of my posting was that if I failed the credit checks (with an Equifax score of 504) then who on earth do they lend to? Then it dawned, is it probably the people who accept their credit insurance and earn more commission for Zopa? If you look on Zopa's own blog there's at least one more person like me who is puzzled why he failed the credit check.

Reply to
SandalsMan

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.