Did You Know: Average Return of All Lenders

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Kylie Greeff
18th May 2016
Our Did You Know series highlights features, aspects and information about the platform that may have passed you by.

In line with our campaign for improved transparency and communication with lenders, we crunched the numbers on our loanbook to deliver you a picture of the average returns enjoyed by rebuildingsociety lenders.

The data we analysed covers the period between our inception up to the end of the 2015/16 tax year, and takes into account all interest received up to this point, losses relating to bad debt, and expected losses on any under-performing loans. The figures do not include promotional credits or any profit/loss from Microloan Trading.

As always, past returns are not necessarily a guarantee of future performance.

So here are the facts:

  • 15.5% AER: If you had placed the same amount on every loan in the said period, your net return would have been 15.5% AER, which compares very favourably with the reported 7.3% AER for one of our largest competitors.
  • Security Counts: The most notable impact on returns was the security offered. It will come as no surprise that loans with only a personal guarantee represent our lowest returns for lenders at just 8.88% AER – though still higher than the 7.3% AER reported by our largest competitor.
  • Size Matters: Our medium sized loans (£50,001 – £99,999) gave the best returns, narrowly ahead of large loans (£100,000+).  This is to be expected given that additional security is required above £50,000, so the medium and large loans are unhampered by the poorer performance of loans backed only by a PG.
  • Cream of the Crop: By quite a margin our highest rates of return were offered by loans that were medium sized and backed with property as security.

Want the numbers to sink your teeth into? Download an excel spreadsheet containing the data.

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