No, with RateSetter you do not need to select the borrowers that you are matched to.
All investments with RateSetter enjoy the diversification effect provided by the Provision Fund, which means that performance of an investment is determined by the performance of the whole loan portfolio, not the individual loans that an investor may be matched to.
We publish up to date information about the types of loans that are in the RateSetter portfolio along with our lending criteria. RateSetter’s expert team of underwriters undertakes all credit and affordability checking before making lending decisions.
Your investment will be automatically matched to a loan contract with a term of up to 5 years. There are two types of loan contract – amortising and non-amortising contracts.
- Amortising contracts: repay instalments of capital and interest each month. This repaid portion of the capital will automatically be reinvested at the Going Rate or the rate you have chosen.
- Non-amortising contracts: repay all capital and interest when the loan reaches the end of its term. The maximum term on these contracts is 24 months. If you are matched to a loan that repays at the end of the loan term, your interest accrues monthly until it is repaid, at which point it becomes Interest Received. Both Interest Accrued and Interest Received appear in your monthly account statements.