Passive income

Why is it important to have a financial education?

By MPI2nd August 2017Smart moneydevelopment, financial education, money, spending

Financial education refers to having a set of knowledge to help you effectively manage not just your spendings but also your investments. Few of us take into account practices that make you more thoughtful with your monthly budget and so forget to allocate certain capital and resources to areas of their life that require more attention. However, the general public tends to be reticent to complex financial terms and overlooks the fact that a preventive attitude is more effective than solving problems. Read about how this attitude can help you in the next lines.

Make a balance sheet and solve urgent issues

First of all, you need to figure out what your current situation is: give yourself an hour or two and identify your sources of incomes and spendings this month. You would be surprised to find out how much money you’re spending in things you do not really need. The next step is to figure out the urgent issues to which more capital must be allocated. For example, if your home has problems with the water installation and you do not have money for the moment, we recommend you take a microcredit. Especially when you have a stable income and your problems have to be solved, the smartest one prevents even greater damage by dealing with it as quickly as you can.

Smartly avoid future spendings

Once you’ve made the balance to see your immediate incomes and expenses, you have to focus on spending on what you can actively optimize. Specifically, this means replacing objects or habits that consume money with some more economical one’s. Imagine that you have a plot of 100 hectars planted with corn and must be harvested in the next 2 weeks. Instead of using a modified tractor that you already have and consuming 30 liters of diesel per hectare, you better buy a new machine.

More opportunities for your development

One of the most common and inefficient practices is not to invest money in your own person. Especially if you set up, for example, certain professional goals based on learning a new set of abilities, you should take advantage of this opportunity as soon as possible. The ability to weld various metals and alloys of different compositions under the water is one of the most lucrative jobs, but to get it you need an expensive intensive course. All you have to do is invest in yourself to get the accreditation of a professional welder and that will help you in the long run.

Zopa peer-to-peer lending marketplace overview

By MPI1st August 2017Peer-to-Peer Lendinginvest, marketplace, peer-to-peer lending, UK, Zopa

Zopa logo

Zopa is a peer-to-peer lending marketplace, founded in 2004, based in UK.

Key figures

200 employees working in their London Bridge office
lent more than £2.49 billion to UK consumers
lent over £800 million over the last 12 months
over 60,000 active individual investors (average amount lent: £13,000)
over 277,000 borrowers approved (borrowing on average £6,600)
a select group of institutional partners

Timeline

2004 – Zopa is founded as a market place for lending and borrowing with a management team drawn from those who founded Egg in the UK
2005 – Zopa is launched to the public and originates its first loan
2008 – The financial crisis hits and Zopa continues to provide positive returns to investors throughout
2013 – Zopa launches the Safeguard fund as a tax-efficient way for investors to offset bad debt
2014 – The Financial Conduct Authority starts regulating the peer-to-peer industry, a move that Zopa has long supported
2014 – Zopa starts working with institutional investors, allowing a more diverse customer base
2016 – Zopa launches a new suite of investment products: Zopa Access, Zopa Classic and Zopa Plus, giving investors more choice in how they lend their money
2016 – opa announces plans to launch a next generation bank, offering FSCS-protected savings products and overdraft alternatives
2017 – Zopa is granted full authorisation by the Financial Conduct Authority for peer-to-peer lending (Article 36H)
2017 – Zopa opens a development centre in Barcelona
2017 – Zopa launches the Zopa IFISA, allowing customers to earn tax free interest on their peer-to-peer investments, and Zopa Core, its latest peer-to-peer investment product

Who can invest through Zopa?

Anyone aged 18 or above who is a UK resident and has a UK current account can invest through Zopa without restriction.
To get started go to Lend your money and select “Find out more”.

Channel Islands and Isle of Man residents

HMRC have granted Zopa dispensation from withholding tax on investors’ returns – this means they can be paid gross, and it is the investor’s responsibility to declare it. This applies to investing and borrowing that occurs within the UK.

For tax purposes, HMRC consider the Crown dependencies (this includes the Channel Islands and the Isle of Man) as a non-UK residency. HMRC have advised us that in such circumstances, either the person paying the interest (i.e. the borrower) or Zopa itself must withhold tax. Unfortunately, logistical limitations prevent Zopa being able to permit off-shore lending at this time.

What is the minimum amount that can be lend in each product?

For Zopa Access and Zopa Classic, you’ll be able to lend from as little as £10.
For Zopa Plus and Zopa Core, given these products are not Safeguarded, Zopa want to ensure that customers’ loan books are adequately diversified, to help investors manage the risk of default. Therefore, they’ll require a minimum investment level of £1,000 from customers who wish to invest in these products.
There is no maximum to the amount you can lend.

What are the loan markets?

Zopa borrowers are put into loan markets based on their credit rating, how much they would like to borrow, and for how long.
Zopa have the following markets: A*, A, B, C1, D and E for each of the lending terms (up to 5 years). The letter refers to the borrower’s credit quality, with A* rated borrowers being the most creditworthy, then A rated borrowers, B rated borrowers etc.
You can see the expected defaults and projected annualised returns for each of these individual markets on the Introducing Zopa’s Risk Markets page.

Are there any fees associated with peer-to-peer investments at Zopa?

Zopa applyes a loan servicing fee to each loan contract, which is deducted directly from each borrower repayment before the principal and interest is passed on to investors. The cost of the loan servicing fee may vary between investment products.
A loan servicing fee is: a monthly fee, calculated using the Zopa Servicing Rate under the Loan Contract to cover the cost of administering Loan Contracts and which may include a Safeguard Contribution (to the extent that the full amount for the Safeguard Contribution was not included in the Borrowing Fee).

Can a business lend through Zopa?

Yes. The business must be:

A UK-based Limited company
Not a lending business
Lending for investment reasons only and not engaged in the trade of money-lending

Prosper peer-to-peer lending marketplace overview

By MPI1st August 2017Peer-to-Peer LendingAmerica, invest, land, marketplace, peer-to-peer lending, Prosper, USA

Prosper new logo

Prosper is the market leader in peer-to-peer lending, a popular alternative to traditional loans and investing options.

Prosper is America’s first marketplace lending platform, with over $9 billion in funded loans.

Prosper allows people to invest in each other in a way that is financially and socially rewarding. On Prosper, borrowers list loan requests between $2,000 and $35,000 and individual investors invest as little as $25 in each loan listing they select. Prosper handles the servicing of the loan on behalf of the matched borrowers and investors.

Prosper Funding LLC is a wholly-owned subsidiary of Prosper Marketplace, Inc.

Prosper Marketplace is backed by leading investors including Sequoia Capital, Francisco Partners, Institutional Venture Partners, and Credit Suisse NEXT Fund.

Prosper is an online marketplace where creditworthy borrowers can request a loan and Investors can invest in notes (or pieces) of each loan. Investors receive a portion of those payments directly to their Prosper account proportional to their pro rata share of the loan. Building a diversified portfolio of many different Prosper notes is more likely to generate a stable yield as well as monthly cash flows. Prosper’s notes are offered by Prospectus which is an official document that describes all the key information for the investments we offer.

Here’s how it works:

Borrowers choose a loan amount, purpose and post a loan listing.
Investors review loan listings and invest in listings that meet their criteria.
Once the process is complete, borrowers make fixed monthly payments and investors receive a portion of those payments directly to their Prosper account.

What type of borrowers use Prosper?

Prosper targets a super-prime and prime customer base. As of January 2016, the average credit score for borrowers on the Prosper platform is approximately 703 with an average $80,000 stated yearly income. The average Prosper borrower is in their mid-40’s.

What happens if a borrower is late on a payment?

If the borrower is more than 15 days late on a borrower loan, the borrower will be charged a late fee. The late fee is divided up pro-rata among the investors in the corresponding notes, subject to deductions for collection fees and servicing fees. If the borrower loan is more than one day past due, we may collect on it directly or we may refer it to a third party servicer or to a collection agency. Borrower loans that become more than 120 days overdue will be charged-off. Charge-offs are eligible for sale to a debt buyer. A borrower whose loan has charged-off will never be able to borrow again from Prosper, and since we report delinquencies to credit reporting agencies, the charge-off will adversely affect their credit report.

How does a borrower make monthly payments to Prosper?

Borrowers can utilize an automated payment deduction from their primary bank account. A large majority (92%) of Prosper borrowers use the automated payment deduction option. In addition, borrowers can sign in to their accounts or mail checks to make manual payments and pay downs.

Prosper Ratings

Every loan application is assigned a Prosper Rating –our proprietary system that allows us to maintain consistency in our evaluation. Prosper Ratings allow potential investors to easily consider a loan application’s level of risk because the rating represents an estimated average annualized loss rate range to the investor.

The Notes that correspond to specific borrower listings are offered pursuant to the prospectus. Investors should read the complete description of the Notes and risks associated with making an investment in the Notes, as well as other information about Prosper and our platform.

How is the Verification Stage different from the Prosper Rating?

The Prosper Rating is our proprietary system that allows us to maintain consistency when evaluating each loan application. Prosper Ratings allow investors to consider a loan’s level of risk because the rating represents an estimated average annualized loss rate range.

In contrast, Verification Stage is not a measure of potential credit risk. It is only an indication of the progress of a loan application based on verification of required information and documents. However, a loan in Verification Stage 3 indicates that the borrower’s information is farther along in Prosper’s verification process thereby increasing the likelihood that the loan will originate.

Estimated Loss Rates

The estimated loss rate for each listing is based on the historical performance of Prosper loans with similar characteristics. The base loss rate is determined by two scores: 1) a custom Prosper Score and 2) the FICO®08 score. Adjustments can be made to the base loss rate based on additional characteristics, such as the presence of a previous Prosper loan. Any adjustments are added to the base rate to get the final loss rate, which then determines the Prosper Rating. The loss rates are not a guarantee and actual performance may differ from expected performance.

Base Loss Rate

The matrix below provides an example of how the base loss rate is determined. The FICO®08 score is divided into 12 distinct bins and the Prosper Score is divided into 11 distinct bins. An applicant’s base loss rate is determined by the intersection of the relevant FICO and Prosper Score bins. For example, a borrower listing with a Prosper Score = 7 and a FICO®08 Score = 730 has an estimated base loss rate = 3.74%, as shown in the table below. Both the ranges and the loss rates will be updated as more performance history is obtained.

Final Loss Rate

Adjustments can be made to the base loss rate that increase or decrease it based on additional characteristics, such as the presence of a previous Prosper loan (i.e., the borrower has already taken out at least one Prosper loan). Any adjustments are added to the base loss rate to get the final loss rate. The applicant’s final loss rate determines the Prosper Rating.

Here is an example of how the final loss rate and Prosper Rating for a loan listing are calculated:

– Borrower FICO®08 score = 730 and Prosper score = 7

– Borrower has a previous Prosper loan

Base Loss Rate:	3.74%
Adjustments:
– Previous Loan:	-0.50%
Final Loss Rate:	3.24%
Prosper Rating:	A

Methodology

Loss rates for a particular group of loans will be a function of the group’s delinquency and loss behavior over time, pre-payment behavior over time, and responsiveness to collections activity. For Prosper loans, the largest driver of the loss rate is the rate at which a group of loans becomes delinquent and charges off. A loan becomes “charged off” and is considered a loss when it becomes 121+ days past due.

Modeling Loss Rates. The loss rate is the balance-weighted average of the monthly loss rates for the group of loans over the term of the loans. The gross loss rate is adjusted for principal recovery net of collection expenses to arrive at a net loss rate.

Estimating Losses. We determine the loss component of the loss rate calculation by analyzing losses for historical Prosper loans and adjusting to reflect anticipated deviations from historical performance that may exist due to the current macro-economic or competitive environment. Changes in delinquency and losses have the largest impact on the expected loss rate of a group of loans, and so changes in loan performance are monitored on at least a monthly basis.

Calculating Average Balance. To calculate the average balance for each period, we used the amount of loan principal on loans that are still open and have not been charged-off or paid off. As loan payments are made, the principal balance of each loan declines over time.

When a loan pays faster than its amortization schedule (pre-payment), the portion of the principal that is pre-paid is no longer included in the outstanding balance for subsequent periods. Once a loan has been charged-off, the principal associated with this loan is considered a credit loss and is no longer included in the outstanding periodic balance.

Collection Expense and Recovery Adjustments. When an account becomes more than 30 days past due, it is referred to a collection agency. Collection agencies are compensated by keeping a portion of the payments they collect based on a predetermined schedule. Once an account has been charged-off, any subsequent payments received or proceeds from the sale of the loan in a debt sale are considered recoveries and reduce the amount of principal lost.

Rent or own? The advantages and disadvantages of each case

By MPI31st July 2017Real estate, Smart moneyinvest, money, real estate, rent, smart

“I’m tired of paying money on rent!”
Have you heard that phrase?
If not … maybe on this one:
“Money on rent is money thrown out the window.”
There are many who claim that being the owner of the house and not just a tenant is the best option.
But there are plenty of people who are on the other side of the barricade and prefer to pay the rent monthly instead of getting tired for paying for decades to the bank.
Have you ever heard your friends say, “I’m not crazy to pay for 30 years to the bank! Who knows what can happen in the mean time? It’s just too long!!!”

The question is:

Who is right? How is it best: to own or pay rent?

We will try to find the answer to this question in this article.
What I want to clarify, however, from the very beginning is this: the information I will provide further, will not make you permanently pass on either side of the barricade and to be pro or against rent for the rest of your life .
That’s because, in our decisions we have to take alongside our lives, and there are, besides our preferences, a number of other factors. Some of these factors are static.
There are also dynamic factors. And these dynamic factors makes that what seems to be the perfect choice now, over the next 5 years will no longer be a good idea.
That is why, I’m proposing to address both the owner and tenant in terms of the advantages and disadvantages offered by each of them.
So, anytime, during your life, reading this article, you can review all these advantages and disadvantages according to your situation at that time, and as a result, you will be able to make the best possible decision.

Why buy a house or apartment?

You buy a house once in your life

A house is more than a roof over your head.
The feelings you associate with your home can be even stronger if they mark a new beginning.
For example, if you just married and together with your half bought a house, you think at it as your home, the home that, over the years, will shelter countless dreams, hopes, but it will also witness many events in live through which every man passes, at some point in his life.
That is why a word from the old says: “In a man’s life you must make a child, build a house and plant a tree.”
Whether you agree or disagree with this phrase, I’m sure you understand the point of having a home. That’s because this house is the foundation for everything that’s going to happen.

It provides stability

You know that you have where to come back every night; a place where you can put your head down and rest after a full day.
You know that you are not at the owner’s mercy that can ask you anytime to leave the house within … or change the terms and conditions whenever he wants or … even worse, maybe sell the property if he is offered a tempting sum of money.
In this situation, you are the one who decides.
And as most of the owners do, if you’ve chosen to pay a 25-30-year credit to the bank, you know that with every single payment you make, every passing month, you’re a step closer to owning 100% of of your house.

There are no surprises

Even if small incidents can occur from time to time (for example: the neighbor above has flooded you and you have to paint again), that does not mean that this will happen every month. Normally, the expenses for your home remain the same.
This will help you to keep track of your expenses, forecasts and financial goals.

Diversification of income sources

Although investing in buying a house to live in, in the long run, does not necessarily prove to be a profitable one, the fact that you own a house can help you a lot in getting new loans from the bank if, from the situation your account, resides that you are a good payer.
If instead, you’re thinking about buying a house, in order to rent it is a good idea. Real estate is nothing but another source from which you can receive passive income month by month from the people you rent it.

Why rent a house or apartment?

You do not need the bank’s approval

There are people who, for various reasons (theirs or the employer) can not go to the bank to opt for a credit for buying a home.
For them, this second option works best. That’s because the system is simple, fast and works in 3 steps: Seen. Pleased. Rent. No more months of running and dozens of approvals and of course … without the burden of thinking that they will have to pay 25-30 years to the bank, no matter what.

Flexibility

And when I say flexibility, I do not necessarily mean the flexibility of the location but also the budget.
Think about it this way: maybe you want to live in the capital city today because, why not … here are the most interesting events?
Later, the agglomeration and madness of the capital don’t feel no longer so good, and you decide to move to a smaller town.
To the retirement age, you may want to live out of town for a simple and quiet life in the country to be closer to nature.
All of these changes can be done quite quickly, because you do not have a real estate already bought to keep you moving from where you want, when you want.
This is perfect for you if your job or business forces you to travel a lot and as a result you have to move often.
We also talk about cost flexibility. If you want to stay in a central area you will pay a price. If, then, for various reasons, you want to pay less, you can rent a property on the outskirts of the city.
Your family is growing up and the studio you lived in until yesterday, has now become a snap? No problem. You can rent a house or apartment with 2 or 3 rooms at any time.
As you see, as a tenant, you have a very high flexibility, both in terms of location and in terms of the amount paid for the rent and the size of the rented dwelling that can be changed, as said above, consistent with the changes that occurs in your family.

Avoid extra expenses

Do not imagine that if he owns the house, the owner of the house has escaped other expenses. Not at all. There are a lot of expences that gather in time and need to be resolved, so you can still live in good conditions in that house and continue to pay rent.
That’s not to mention the taxes that the landlord has to pay annually. You, as a tenant, do not have to take out any money from your pocket for that.
As a tenant, you avoid the costs of removing the furniture, redecorating the new home, etc.

Access to liquidity

A house can not be converted into cash from one day to the next. From this perspective, it is illogical to put your lifetime savings in one thing: in a building.
That’s because it cannot be turned easy into liquidity and also, depending on the evolution of the real estate market at that moment, no one can guarantee you that the real estate you own will be sold over the years at a price above acquisition.

Instead of a conclusion

Now, at the end of the article, I’d like to know your opinion. From your point of view, if you have the choice now: to rent or to buy a house, what would you choose and why?

6 tricks to negotiate a smaller rent and be a winner

By MPI31st July 2017Real estate, Smart moneymoney, real estate, rent, savings, smart

Are you looking to rent an apartment, a studio or a house and want to get a monthly rent as small as possible? Then the tips below will definitely help you when you negotiate with the owner of that building.

1. Do the research. Study the market.

You need to know at what prices are rented other similar buildings in the area.
And when I say: to know at what prices are rented, I do not refer to the price displayed on real estate sites, but the actual amount the tenant pays after negotiating with the landlord.
This will take you some time. I know that. However, in order to be able to negotiate effectively, you need to have enough valid arguments at hand in negotiating with the owner. Of the two of you, the one who comes up with the strongest arguments will win.
If you do not like it or do not have the time to sit and study the market, you can call a real estate agency in the area, to come a real estate agent with you, inspect the apartment you want and help you in the negotiation process.
An experienced real estate agent has much more knowledge than you could get from watching a few housing deals. However, consider that, in this case, you will also have to pay a commission to the real estate agency. But do not worry about it. Think of it this way: if eventually all the parties involved win, that’s all that matters.

2. Count on honesty

Mutual trust is an important factor in the long run if you reach an agreement with the owner and sign the rental agreement.
That’s why, when the negotiation process takes place, do not fall in the temptation to use false informations, in order to make the owner take decisions that favors you. If he feels like you are trying to force his hand, he will withdraw from the bargain and look for another client, and you will have nothing to gain from the whole process.
The reverse is also valid. If in the bargaining process you feel the owner is trying to bloom things so they seem much better than they are in reality, it’s time for you not to get tired anymore. Signing a contract with a liar owner will only bring long-term additional headaches and is not worth it.

3. Treat the man in front of you with respect

Try to keep a constant attitude throughout the negotiation process. If you annoy or offend the owner, or do cynical affirmations, you will not look smarter and will not be able to turn back the situation in your favor.
Look at the situation also from the owner’s point of view. Respect his opinion, because you want, in turn, for him to respect your point of view.

4. Go on the win-win idea

Think that if you come to an agreement in the long run, both you and the owner will win: you will pay a lower rent and he will not have to lose time constantly running after new tenants .
So when negotiating, do not try to win all your battles. If the owner gives up something, when you talk about a particular aspect, give up on yourself when you negotiate another aspect of renting the building.
If you can give more rents as an advance from the beginning, it can be a great asset for you. So, in the eyes of the owner, you are perceived as a trustworthy tenant, without any financial problems, which will not make for him every month’s trouble when it comes to paying rent.
At the same time, the bigger amount you give him from the very beginning can make him look so much to be willing to offer you a lower rent than he would have initially wanted at the beginning of the negotiation.
You can also, in return for a smaller rent, to renovate his apartment or fix some of the faulty things in the apartment.
Also, if you are good at something and the owner needs that service, you can try a bargain: for the amount that reduces the monthly rent, you will provide services periodically, in the field you are skilled in.

5. Whatever happens, stay calm

When emotions are involved, and each one holds at their point of view and are not willing to change it, then negotiation becomes almost impossible, and a conflict is reached rather than an amiable understanding.
The higher the tension between the two parties, the more likely the two parties to sign a lease contract decreases. That’s why, although I know it’s hard, in a bargain you have to look at everything “at cold”.
Detach yourself from emotions and try to look at the whole situation from the outside, from both angles – the owner and the tenant.
This will give you a clearer perspective on the whole process, and at the same time it will be easier for you to keep calm, compared to the situation where you see this whole transaction as a matter of life and death.
Also, even if you are desperate to rent that home, do not show you’re desperate desire even if:
– You know that tomorrow you do not have where to stay and you will sleep under the free sky or
– You think you cant’t find a home like this anymore even in your most beautiful dreams.
The more you are desperate to become a tenant in that building, the more the owner will “smell” you more easily and will get harder in the negotiation process.
As I said earlier … leave your feelings home.

6. Do not let yourself intimidated

Do not rush to make the decision to rent the house at the price proposed by the owner, depending on events such as:
– as you visit the apartment, there are other potential customers who have also found themselves to watch it at the same time as you. Most likely, it’s a “production”, meant for you to rush to make a decision.
– while the landlord shows you the home, his phone rings and the alleged clients at the other end of the wire makes him to come back to you and say, “So what is it … you’ll take the apartment or I will talk to the customer on the phone to come and see it?”

In conclusion: when you start the negotiation process for the monthly rent in that building, remember the advices above and you will be much more satisfied with the outcome of the negotiation.

Eurocent continues servicing loans on Mintos peer-to-peer lending marketplace

By MPI29th July 20171 commentNews, Peer-to-Peer Lendingbonds, Eurocent, loans, Mintos, repayment

Here is an update on the situation with Eurocent-issued loans. After missing repayment of its corporate bonds on June 8, 2017, Eurocent has continued servicing the loans and passing on all borrower payments to investors on the Mintos marketplace. Since June 8, 2017, the outstanding investment portfolio in Eurocent loans on the Mintos marketplace has decreased by 21%.

Eurocent continues to negotiate with potential investors to resolve its financial situation. However, given the still-uncertain results of these negotiations, Eurocent has submitted an application to the court to restructure the company’s debts. This is a formal procedure that prevents creditors from commencing enforcement proceedings of the unpaid corporate bonds. The decision of the court is expected by September 2017.

If the court does not allow restructuring of the debt, Eurocent will enter bankruptcy procedure. To prepare for this scenario, Mintos has made an agreement with a third party that will take over servicing Eurocent-issued loans assigned to investors on the Mintos marketplace.

Given its financial situation, Eurocent has suspended the automatic buyback of loans that are late by more than 60 days. When automatic buyback was suspended through the technical side of the platform, the shield icon visually indicating the buyback guarantee was temporarily lost as a result. However, Eurocent still remains liable for the guarantee, as indicated in the respective loan assignment agreements, and the shield icon will re-appear for Eurocent loans after the next platform update.

Eurocent-issued loans that are delinquent continue to be serviced according to standard processing, and all repayments made on the loans by borrowers are paid back to investors on the Mintos marketplace. The company plans to fulfill its buyback liability as soon as its financial situation has improved.

If the company’s financial situation is not resolved and Eurocent enters bankruptcy procedure, investors with outstanding investment in delinquent loans that are not bought back will have a creditor claim against Eurocent.

New structure for investments in Lendo loans on Mintos peer-to-peer lending marketplace

By MPI29th July 2017News, Peer-to-Peer LendingGeorgia, Lendo, loan originator, Mintos, Mintos OU, peer-to-peer lending

Starting from August 3, 2017, there will be a new structure for investing in Lendo loans on the Mintos marketplace. The new structure stems from new regulations imposed by the local supervisory authorities in Georgia, where Lendo operates.

How will the new process work?

To obtain exposure to Lendo loans, investors will be able to invest in loans issued by Mintos OU to Lendo, where repayments depend on the final borrower’s payments. Each loan issued by Mintos OU to Lendo will be pegged to a respective loan issued by Lendo to the final borrower.

Mintos OU is a Mintos group company. A detailed description of the new structure is available in the Mintos OU loan contract and assignment agreement.

How will the new structure affect investors?

Investors making investments according to the new structure will still gain exposure to Lendo-issued loans. Previously, investors had a direct claim against the final borrower; now, investors will have a claim against the loan originator – Lendo.

Because investments made will still be pegged to the loan performance of loans issued by Lendo, current Auto Invest functions for investing in Lendo loans will remain valid for loans placed on the Mintos marketplace under the new structure. If the change in investment structure affects your investment preferences, please be sure to adjust your Auto Invest settings accordingly.

About Lendo

Lendo joined the Mintos marketplace in July 2016, and has since become one of the top loan originators on the marketplace. The company offers investments in short-term unsecured loans issued in the largest cities in Georgia. So far, Lendo loans worth more than EUR 80 million have been funded through the marketplace.

6 Things To Know Before You Invest In Real Estate

By MPI28th July 2017Real estatefinancial education, invest, personal finance, real estate

When we think about starting a business or making a financial investment, the ultimate goal is usually the same: getting enough money to allow us to live the lifestyle we want.

And when you think about the amount of money you have to raise to allow yourself to do that, do not forget to consider inflation + taxes that have to be paid and that will automatically have to be deducted from the total amount of money you have.

And when it comes to investments, having a property or several real estate is always a good idea; even in periods of financial crisis.

Think so: land is a finite resource. People will always need spaces specially designed to live, work and have fun. So, just like in other areas of business, so is in the real estate: everything is just a game between demand and supply.

What is good to understand is that: real estate properties will continue to experience an increase in their value as time passes, despite slowing down periodically as a result of more subtle or larger economic crises.

Real estate is the field that brought most people from simple people to millionaires. And in spite of what you might think … no, you do not have to be a genius to succeed!

So, if you’re thinking about investing in real estate, to gain your financial independence, here’s what you need to know:

1. Set your financial goals

What are your goals from a financial point of view?
What are you expecting from buying a real estate?
What you achieve by acquiring that property will bring you closer to achieving your financial goals?
As you well know, developing a business requires time and money. Investing in real estate is no exception to this rule.
So, if you have an already tight amount of money that you want to invest in this direction, make sure you take all the time to identify a property that matches your budget and not just so … a property which, once purchased, will serve your interests better and will make it easier and faster for you to accomplish your goals.

2. Do not spend a fortune on books and courses

You do not have to misunderstand. You need to have some knowledge about real estate because, from this adventure you start, you get to be a winner. But what you must know is that all the information you need should get maximum a shelf on your library as a volume.
So bend over the books and study carefully. Search on Google and make a habit of reading real estate sites.
But do not overwhelm yourself with the existing information around you. When you notice that you read, read, and the things you already know continue to repeat, with 1-2 relatively new elements in addition, it means you have learned about everything you need to know.
It is very easy to let go of the thought that you still have not found the trick you need to quickly get rich out of real estate and continue to document, collect books and courses in the hope that you will find that secret information that will open the gate of wealth in real estate for you.

So, when you notice that the information you read is still repeating, it means that it is the perfect time to stop reading and return to real life. It’s time to move to point 3.

3. Visit several real estate properties

Life beats the movie. And what else can make you feel the pulse of real estate in your area, than … some direct visits on the field.
But great attention! Do not buy the first property you see.
Here are two mistakes that many real estate investors do:
– Buy a property for the simple fact that they like what it looks like
– Buy the property because they are not willing to make the effort to inspect other properties existing on the market at that time
Remember: you must look at that property from the perspective of return on investment. You will not live there. You do not have to like it. Instead, it must be profitable when you decide to sell or rent it.
Once you’ve visited enough real estates, take a moment to think and put on paper the most tempting real estates you’ve visited. Write along with them your financial goals. Then try to reduce the number of listed properties from the perspective of the goals you want to achieve.
This exercise will help you make the most beneficial choice for you.

4. Do not expect the miracle offer

By viewing real estates again and again, you can fall into the other side: to postpone the decision to purchase. And as you may well guess … this action will have negative repercussions.
Not buying a real estate under the pretext that you have not found the “winning offer”, you might lose more than if you found an offer not as tempting as you would like, but you have bought it to put it to work, to produce money for you.
To conclude: as soon as you find the real estate offer that meets most of your criteria, stop thinking and buy it. Continuing to wait for the “irresistible offer” you dream of is a dangerous game … this offer may never be, and the offers that pass next to you may not come any more soon.

5. Make a thorough financial analysis

Let the figures speak. Look at all like a game of numbers. Just so, the conclusion you get will be realistic.
If you think about the whole transaction from the financial perspective and leave your feelings aside, it will be easier for you to refuse a property when the terms and conditions of the transaction do not meet your profitability criteria.
In this sense, take the time to make a complete analysis of the property based on its history. Also, inform yourself about the distance to the city’s main points of interest.
See how much you can rent or sell the property according to the potential of the area.
Take into account the taxes that must be paid and the interest you have to pay to the bank, if you make a loan to that effect.
And finally, draw the line, and see how profitable your real estate investment will be.

6. Find sellers anxious to close the deal

How can you do that? When you find a real estate that you like, be interested in it’s history. Since when is it put up for sale? How has it’s price changed since it’s on sale to date?
If the price of the apartment or house in question is unchanged although the property in question is on sale for more than a year, you can see that its owner has it’s price and is not willing to give it less than what he ask for; in other words: negotiating with him will not end with far greater benefits for you.
But if you find a property whose price has continued to decline over the last year, it means that its owner is anxious to get rid of it. As a result, that person will be more flexible in negotiating with you, and you are likely to have the chance to win and get the price and conditions you want.

Conclusion

Owning one or more real estate properties can provide you with the financial stability you want. It can also be packed with those passive income that everybody wants, if you rent it.

It’s all about staying calm, not making hasty decisions, and logically judging, based on figures. Real estate businesses are long-term businesses. Also, it’s important to realize that buying the desired property is just the first step you take to reach your financial goals and not the end of the road. Success!

Learn how to invest in real estate

By MPI25th July 2017Real estatehow to, invest, personal finance, real estate

Real estate investments are safe and have the best chances of becoming profitable in the medium and long term. The situation has changed over the last years, the crisis has been overcome and the real estate market has balanced, and a real estate investment can be, very easily, driven to success. Any real estate investment process is required to undergo a valuation and analysis procedure to make the investment profitable.

Stages you have to go through to make the actual investment:

1. Analyze your financial situation. Set your budget clearly. In particular, evaluate your assets and incomes, analyze your expenses. Thus, you will be able to have a clear picture of the capital you would have available to invest in real estate. If you intend to make a loan for this initiative, your savings will be very important in paying advances and reducing the monthly financial rate.

2. Consult a bank. Depending on your budget, if you think you still need money to go into the investment, consult a bank and get a credit pre-contract. Thus, you will find the amount you will have to make a first investment in real estate. You will also know the monthly rate you will have to pay in the case of a credit.

3. Make an investment plan. For starters, try to determine what properties you would be willing to invest in. For example, if you live in an area with intense economic activity, a profitable investment would be in an office space. This type of property can bring you a substantial income and can support the rate if you have a bank loan.

4. Verify your competition. Analyze the offer on the local real estate market, especially if you are targeting an investment in your city or area where you live. Depending on the information obtained from the market analysis, you can determine that your investment in real estate will bring extra gain. The market for apartments, commercial spaces, land is a competitive one, so it is mandatory to differentiate your property through a value element to raise the interest of potential buyers or tenants.

Only invest in areas where that you know. Take these steps before you make a first investment in real estate, leave a comment and tell us your opinion.

Financial freedom – one of the keys to happiness?

By MPI23rd July 2017Smart moneyfreedom, money, passive income, personal finance

Obtaining financial freedom is one of the most important responsibilities in our lives, not just for personal well-being and for family, but also for getting rid of any health or inter-human problem that could be generated by the lack of money.

In a world marked by profound changes, which are succeeding at an alert rithm, and in which it becomes increasingly obvious that we are the only ones responsible for our future, setting as the goal of obtaining financial freedom is an important component of personal success.

Money can offer this freedom. The more money we have, the more freedom we have and the more options we can choose from. Achieving a sound financial education is only the first step in achieving material wellbeing, but it is indispensable in its preservation and the subsequent attainment of financial freedom, that particular state in which the winning of money no longer preoccupies us.

Financial freedom is a deeply individual state. No one can decide in our place how much money is enough to consider us financially free. This state can be achieved by anyone who engages firmly and persevering in achieving this goal, and the starting point is how to manage your personal finances.

How to build your passive income

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