FAQs

How can I feel safe lending my hard earned money to someone I don’t know?

The risks and safeguard are similar to those of renting out your property to tenants who you may not know before hand but trust them with your asset based on checks and measures in place – think of this as renting out your savings to get a market leading return with the appropriate safeguards In place.

All borrowers and investors in our marketplace have passed stringent identity, background and financial checks, so it is likely they, like you, are reliable honest and smart people looking to get more from their money. Look for people with strong scores, stable employment, strong education to see if its likely they will remain in a position to repay your investment. Bear in mind that they have probably been servicing the same loan at a much higher rate with another lender already.

Ultimately any agreement reached between the two of you is based on a clear and enforceable agreement that is made clear to both parties and has the weight of the law of the land behind it – like any financial agreement it carries strong punitive measures if the agreement is breached that should keep your interests and capital secure.

Failure to meet their obligations will have strong and long lasting negative consequences including but not limited to impact on the person’s credit rating, barring from the marketplace going forward and incurring significant financial impact from early collection of the obligation and any charges incurred. So it is unlikely people would default lightly or play the system.

Keeping your savings in an account where they earn little or no interest is like having a brand new shiny car you always dreamt of but then keeping it locked up in a garage it will stay safe but will not serve its purpose of getting you from one place to another. Similarly if you are not making interest on your savings that is such a waste – but equally you wouldn’t take you new car to a demolition derby and damage it so we encourage you to be prudent with your savings and split your investment across several borrowers so any risk you are taking is diversified across multiple parties.

What safety nets has BestRates4U got for the investor?

We offer all investors a 5-layer safety net :

• All borrowers would have validated credit history, affordability and our credit model checks taking into account other available and validated borrower data. This generates a by-category score investors see.
  
  
• The investor's ability to choose the level of risk they want to take (based on ratings above and interest rate suggested) and the strong advice repeated several times to invest small amounts with different savers to spread their investment risk.
  
  
• Optional "rent guarantee" insurance they could purchase especially for larger outlays -- which would of course reduce their earning amount but still offer a better return than they have today.
  
  
• Capital safety by having an enforceable legal agreement that will mean any defaults will lead to financial and physical collections and in the worst case a claim in court. The investor would not have to wait as this would be handled by a specialist third party who would "buy" the debt and compensate the investor.
  
  
• Clear linkage to defaulting borrower credit records, barring from the marketplace going forward and incurring significant financial penalties would discourage any wilful defaults or gaming the system..
  
  

How will the interest rates be set?

Rates are set by splitting the difference between the current market rate for the borrower’s needs and the leading comparable savings rate on offer so that both parties stand to gain from the market place.

So for example if a person is paying 9% on a personal loan over 24 months and the best savings rate on offer is 1% so they would transact at 5% and both make a gross %age saving of 4% by using Best Rates 4u&Me.

The rates being linked to every borrowers requirement would be clearly displayed on their vetted applications making it easier for investors to choose which loans they would be happy to fund using their savings.

How is this different from other Peer to Peer lenders?

Almost all other peer to peer offerings are structured to have the platform as the middleman (portfolio consolidator, rate setter or other similar terms) which means like a bank they charge a premium for their services and the consumer gets a sub optimal rate and ends up paying for services they may or may not need.

In our view this dilutes the power of true P2P lending as the democratization element of letting the consumer transact directly and safely with other consumers at rates and terms they agree based on our templates and suggestions. This ensures that the consumers only pay for what they need and can create bespoke portfolios for themselves based on need and appetite

Best Rates 4U&Me does not become a party to the transaction. I tmerely provides both parties with a secure platform, necessary data about the other party to allow consumers to have the confidence to transact safely with other consumers. It also offers access to other value added services that consumers can choose to utilize or not. Our primary goal is to help people improve their financial lives by offering a best value clear and transparent service.

Where can I get more information?

We are currently working on building out the platform, gaining necessary regulatory approvals and finding partners to work with to help us deliver a best of breed digital service that gives you the best rates in the market

Please come back here for regular updates and look out for articles in leading newspapers and business magazines outlining our new proposition and what it brings to the market

If you would like to be involved in helping out fine tune our proposal please sign up below to be part of our oneline focus groups to give us your views on ou r product and features you would like to have included and become eligible for exciting gifts rewards and incentives. Please give us our details in the sign me up section below,