When you lend through Funding Circle, your money is matched to loans in your portfolio, which have a duration of up to 5 years. As a result, it is important to treat lending as an investment, not a savings account, and investors should only lend money they are comfortable with being invested for up to five years.
Investors are able to access their funds in two ways:
- Switch lending off. Businesses pay back interest and principal each month, so by simply switching lending off, you will receive approximately 3-5% of your outstanding portfolio after the first month and approximately 30-40% of your money back after the first 12 months.*
- List loan parts for sale. Our selling tool matches investors looking to sell loan parts with investors looking to buy. However, this is subject to demand from other investors and selling is not guaranteed. When a loan part is sold, a 1.25% transfer payment is paid to the buyer by the seller. For example, a £20 loan part is sold for £19.75.
You can only sell active loans with no credit issues, and not in the last month of their term. Any loans not sold after 120 days will be delisted and you’ll need to make a new request to sell them.
*These figures are based on the average repayment rate for all loans outstanding on the 1st of September 2019. As you are lending to your own individual portfolio of loans, your actual repayment rate may differ.