Funding Circle sells package of defaulted loans
Funding Circle’s retail investors have received funds from the peer-to-peer lending platform following the sale of a small cohort of defaulted loans.
In a note to investors, Funding Circle said that it had sold a package of defaulted loans on 2 February 2022. The platform reached out to those investors who had invested in the defaulted loans, advising them that additional funds will be available in their account within the next business day.
It is believed that the loans were sold to Cabot, a Financial Conduct Authority regulated company.
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The amount that each investor can expect to receive will depend on their individual portfolio, but is understood to be in line with what the platform would expect to recover over a five-year period. The loans were originated across multiple years.
“When a loan defaults, the outstanding amount owed to you will be shown as ‘defaulted’ in your account and is deducted from your total portfolio,” Funding Circle explained, in a note to investors.
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“We then work to recover this defaulted amount on your behalf and, over time, any recoveries made become available in your account.
“As a result of this sale, you have received the net proceeds of the final recovery payment for these defaulted loans in your account today, bringing forward what we expected to recover typically over a five-year period. Therefore, you will not receive any further repayments on these loans.”
Funding Circle investors have been invited to check their transaction statements for more information on the amount received per loan.
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