Studies of Life

Learning by doing.

Category Archives for: bondora

How to Bulk Remove Your Loans from the Bondora Secondary Market

13 January 2016 by Jim

If you’re currently selling loans, for whatever reason, you can try using a specific discount / markup, and then try again with another one if it doesn’t work. Most loans on the Secondary Market sell, if at all, during the first week. So it’s no use waiting for a month.

I have quite a large portfolio of loans, most of which are HR 60+ days overdue (… don’t ask…) so I’m trying to get rid of them at VERY STEEP discounts. I had to increase them several times, and always waited for the 30 days until they were taken off the Secondary Market, to try selling again. (more…)

A Very Bad Trend in Bondora’s Platform Statistics

16 September 2015 by Jim

I’ve been looking through the forums on Bondora, and a post from carlos caught my attention.

What is it about?

Basically, the platform statistics show that the amount of money lost in defaulted (=more than 60 days overdue) loans is approaching the total amount of interest paid out, as can be seen here:

If this is true, and we assume that defaulted loans barely recover any money, then that means that on average, most investors on Bondora are not making a lot of money.

I personally treat my defaulted loans like write-offs that I will never recover. At most, I would expect 10-20% of the defaulted amount to be recovered sometime in the far future. (more…)

Markup / Discount levels for Selling Overdue Loans on Bondora

16 August 2015 by Jim

One of you guys recently sent me a link to a very interesting website (http://bondpicking.com/) that allows you to see charts of the different Bondora loans that were sold on the secondary market, and at what price (XIRR or markup / discount) they were sold. They look like this:

All ratings Bondora chart

Using the current average markup, displayed in yellow on his site, I put together a table of what the average markup currently is. In order to effectively sell, I added 10% to that markup in each case, because it’s just an average, and some loans are more expensive when they’re sold. The table is below. It’s basically -14% for HR, -12% for C-F, -9% for B and -4% for A. (more…)

Bondora Payment Reliability after 24 Months

16 May 2015 by Jim

 

I’ve recently posted saying that I made some bad choices in the way I invested on Bondora. That’s still true, so I would still recommend everybody to be cautious and not go “all-in” too quickly. I’ve learned my lesson.

But since I am not able to withdraw my entire portfolio quickly from Bondora, which I knew from the very beginning, I’ll keep tracking the performance of my portfolio and posting updates on how it is going.

As you can see in the chart above, payment reliability does stabilise over time in a growing portfolio. The biggest changes occurred at the beginning, and as the portfolio stabilised in size, so did the payment reliability. As you can see, principal is repaid reliably and the average amount of planned principal actually repaid during any given month is above 90%. With interest, reliability is approaching 60%, which is lowish but not surprising. (more…)

How not to invest on Bondora

03 May 2015 by Jim

I’ve been investing in Bondora for over a year now, and the new risk rating system implemented at the end of 2014 really seems to work. Unfortunately, I made a mistake. I invested almost the entire amount I allocated to Bondora in 2014, as you can see here:


I unfortunately loaded up on a lot of bad-quality loans for this reason, and once the new risk rating system showed up a large part of my portfolio was HR and more and more loans became overdue.
I reacted to this by trying to sell lots of HR loans to get rid of them before they became 60+ days overdue. As you can imagine, it’s difficult to sell such loans, so I had to offer discounts. Steep discounts. And I lost quite a bit of money doing that. So I now have quite a few defaulted loans. Have a look: (more…)

Bondora Payment Reliability: 82% / ROI = 19.5%

21 November 2014 by Jim

Bondora Repayment ReliabilityI’ve started investing on Bondora in May 2013. Since then, 17 months have passed, and here’s a chart with the percentages of principal and interest that are actually paid back. As you can see, the long-term trend is toward a decrease, which was to be expected as the portfolio matures, but there are no huge decreases, so the trend is not alarming.

The overall percentage repayment probability is on average 82%, split up into:

  • 95% for principal
  • 68% for interest

Principal is paid back more reliably because when borrowers send their payments, they are first used to pay back the principal, and only what is left over after that is applied to the due interest. (more…)