Forced to end investments, funds are forcibly returned... This is quietly painful too ~

As I wrote last time, popular providers such as Lucky Bank and Trust Lending attract a flood of applications, making it hard to invest, and there are a few other issues with social lending as well.

This is early repayment due to the borrower's circumstances.

If investors in social lending earn about 3–9% in profit, the borrower has to pay that interest plus an additional share (the social lending provider's commission), which naturally imposes a heavy burden.

If you have taken out a mortgage, you surely understand—when you have extra money, you want to quickly repay early to reduce the interest you pay as much as possible.

This can also happen in social lending.

It would be great if the loan could be repaid early, but in social lending we are the lenders.
To be frank, it's not something we’re happy about…


【In terrible cases, even such early repayments occur】



In the bottom row of the above image, there is a description that the operating period is 9 months (2017/06/16–2018/03/28).
This is a maneo case, and I invested 300,000 yen in it.
And what happened to it…



The title of both the image above and the image just above it is “Real Estate Secured Loan Fund GC41."
Since the loan start date is 2017/06/16 as well, you can see that the two images are for the same case, right?

In募集案件, the operating period is 9 months (2017/06/16–2018/03/28)　
Actual operation shows loan start 2017/06/16 and loan end 2017/07/28 on the upper image
Isn't that so?

That's right—although the borrower signed a 9-month loan, they actually repaid in full in just over 1 month…

Of course the borrower would rather keep paying 6.99% interest + α and borrow longer, but when this happens investors are left with a terrible situation.

Indeed, the damage is minor compared with fraud like a total default, but it makes the investment project look completely unsatisfactory (・_・;)
Only for 9 months of interest, you would receive only about 1 month and a little worth of interest…

【Unnecessary capital binding is also quietly annoying】

Social lending is different from bank deposits—money doesn't earn interest immediately after you deposit it.
There is an application period of about two weeks, and even after that it takes about another week to actually lend.
If you want to avoid tying up funds, you’d like to invest on the final day of the application period, but popular projects sell out in minutes, as I wrote in the previous article.
So about three weeks of capital constraint before investment is unavoidable.

Moreover, at the end it’s similar—the investment funds are not returned on the closing day, but wait about another week.
For “Real Estate Secured Loan Fund GC41,” loan end is 2017/07/28, but the distribution date is 2017/08/08, a ten-day lag.

So each time you apply for one project, your funds are tied up for about another month.
It’s not something to be underestimated.

And while the original 9 months of investment would be +1 month to 10 months,
if it becomes a one-month project, you receive the interest for one month over two months.
This is awful. Moreover, since the money that you originally had no plan to use for 9 months was repaid, you must search for the next investment destination. If the next one is found well, fine, but if not, your funds float in the air, and if you invest in the next project, you’ll again have your money tied up without interest for about a month before and after the investment.

Compared to fraud or asset collapse, the pain is minor, but there is no way to avoid it and it’s unpleasant.

※ Some people fear long-term projects and repeatedly choose short-term projects, but this unnecessary binding of funds truly reduces investment efficiency. If you quit social lending after one short-term project, that’s fine, but if you repeatedly take on projects, the risk cannot be avoided, so I feel it’s advantageous to engage in a certain amount of long-term projects.

Through this point site, I issued three credit cards in about half a year
3万円 from 10,000 yen × 3 = 30,000 yen as a gainIn total I gained 219,000 yen ♪

【The best cashback point sitePoint Income

(Publications for buyers: please rewrite this part)