How to access your funds
By lending through Funding Circle, your funds are lent out in small amounts to lots of different businesses. These are called loan parts, and businesses repay them over 6 months to 5 years.
Each month you receive back a portion of the money you have lent plus interest. By keeping lending switched on, these repayments will be lent out again on more loans. This creates a rolling investment to help you earn better returns.
As a result, your funds are continually lent out to businesses who repay over up to 5 years. When you want to withdraw funds you have two options:
1) Switch off lending to withdraw small amounts
If you’d like to take out small amounts, you can withdraw your repayments as you go. Simply sign in to your account, go to the ‘Lending Settings’ page and turn off lending. Your repayments will no longer be lent out and the funds will accrue in your account.
The rate at which your funds will accrue will vary, but on average investors get back:
Approx 3-5% of their portfolio after the first month
Approx 15-20% of their portfolio after the first 6 months
Approx 30-40% of their portfolio after the first 12 months
The rate then slows, with repayments continuing over 5 years (or longer with recoveries).
Figures are based on the average repayment rate for all loans outstanding on the 1st of September 2019. As you are lending to your own individual portfolio of loans, your actual repayment rate may differ.
2) Sell loans to withdraw a lump sum
If you would like to access your funds before your loan parts have been repaid, you can look to sell them to other investors using our automatic tool. There are no fees to sell loans or withdraw funds, however, selling loans is subject to supply and demand at the time.
To withdraw funds you need to first set up a nominated bank account.
How does the selling tool work?
To use our selling tool, sign in to your account and go to the Sell page. It will show the value of loan parts you have available to sell at that time (not all loan parts can be sold, more on this below).
Enter the amount you want to sell. If you don’t want to sell the full amount available, the tool will select loan parts that best match up to the value of your request.
Your loan parts will then be placed into a queue. When they reach the front of the queue, they will most likely be sold in one batch, so the amount sold may show as £0 until the sale is completed. We’ll email you to let you know when the sale process is complete.
How long does it take to sell loans?
The time to sell your loan parts may vary. At different times the number of investors looking to buy or sell loans will change, which affects the size of the queue. To help treat all investors fairly, our lending tool balances how much lending goes into new and existing loan parts, which can also affect the queue times.
You can find the latest queue times in our FAQ which is updated weekly.
To sell your loan parts as fast as possible, please keep them in the queue. If you cancel a sale and start again your loan parts will rejoin at the back of the queue.
How much of my portfolio can I sell?
To make it fair to all investors, you can only sell active loans with no credit issues, and not in the last month of their term. As a result, typically 85-95% of your portfolio is available to sell at any one time.
For loans that are late or have another credit issue, our Collections and Recoveries team are constantly monitoring and working with these businesses to recover the funds. You’ll continue to own these loan parts and receive repayments and interest as they come in.
If their credit issue is resolved, they will become available to be sold again.
What about defaulted loans?
Defaulted loans are removed from your portfolio and will not be available to be sold again. Our Collections and Recoveries team pursue each defaulted loan to recover as much as possible (read more here).
Recoveries take time and may vary significantly depending on the loans in your portfolio. Successful recoveries will appear as Available funds in your account as they come in ready for you to withdraw.
Will I get the full amount requested?
The amount you will have in your account when the sale is complete may differ from the amount requested.
If you are looking to sell your whole account, any loan parts that can’t be sold (for the reasons given above) will not be sold, so the amount you receive may be lower than the amount requested.
If you have any further questions or want to know more about accessing your funds, you can contact our Investor Support team at email@example.com.
All information correct as of 1st October 2019.