The team at EstateGuru, an online lending platform that offers retail investors the ability to back loans secured by property, notes that even though we’re in the middle of really hot summer days and the start of the holiday season, the platform has still seen a lot of activity, with 80 loans being financed during the month of June (total funded amount was €15.3M).
As mentioned in the update from EstateGuru, Estonian and German projects “collectively comprised more than 50% of the volume.”
The company also noted that along with these solid sales volumes, loan repayments have “remained stable.” During the month of June, a total of €10.2M worth of loans “were repaid to our investors” and “the average return on the repaid portfolio was 10.8%,” the lending platform’s management revealed.
“The increase in the default rate continued in June as a new market (Spain) was added to our ‘countries with at least one defaulted loan’ list. A Finnish defaulted loan, which we mentioned in last month’s report (bankruptcy estate case), will be recovered in the coming weeks as there were delays from the buyer’s side. In Latvia, two loans (same borrower and collateral) were successfully recovered in June (€0.2M).”
EstateGuru pointed out in its latest loan overview report that ongoing legal disputes “take most of our debt collectors’ and external partners’ time.” EstateGuru’s internal debt collection system, “from late payment gathering to enforcement, has been developed to be robust and efficient, but external bureaucracy makes the process of recovery slow.”
However, this does not change the platform’s goal to lower the default rate “to below 5.0%.”
EstateGuru said they’ll keep investors and other platform users informed regarding their credit portfolio quality “on a monthly basis.” If you’re interested in learning more about Estateguru’s business, you can read their most-recent annual report here.
As stated in the report:
- Total financed loans since 2014 – 387.5 Million Euros
- Total Repaid loans since 2014 – 226.5 Million Euros
- Total outstanding portfolio – 161.0 Million Euros
- Total outstanding defaulted loans – 14.9 Million Euros
They also confirmed:
- Total number of outstanding defaulted loans – 97
- Default Rate (Outstanding loans) – 9.2%
- Default Rate (total Financed loans) – 3.8%
- Total amount of Recovered loans – 11.1 Million Euros
- Total number of Recovered loans – 64
- Average return rate of recovered loans – 10.0%
- Average time from default to recovery – 7.7 months