Get A Regular Income From Lending Works

Additional reporting by Neil Faulkner.

Lending Works now allows lenders to receive their interest payments directly as a monthly income. This will start from 6 April, which is just in time for our next Lending Works pay checks.

Lenders can also choose to receive a combination of interest and repayments of the actual loan back on a monthly basis.

Lending Works is only the second P2P lending company to offer this facility, alongside RateSetter.

Who should – and shouldn't – take a P2P income

This income facility will suit those who want to supplement their other income with their peer-to-peer lending earnings. Typically it appeals to retired people.

If you forgive my laziness, I'll copy-and-paste how Lending Works described it in today's press release:

“Auto Income is expected to appeal to a growing set of pensioners for whom the high interest rates available via peer-to-peer lending are very attractive, but who do not wish to wholly lock away funds over a long period of time.”

If you're not looking for an income, to get the most out of peer-to-peer lending it is necessary to re-lend your interest and the loan repayments you receive.

If you withdraw all your interest, you might earn around £6,000 before tax over ten years on a £10,000 pot at current interest rates.

If you re-lend the interest, you'll earn around £8,000. The huge boost is due to earning interest on top of interest, which snowballs each year.

Auto-lend, re-lend and withdraw

Only one other peer-to-peer lending company offers as many automatic options. Both Lending Works and RateSetter allow you to easily set up your accounts to do all the following for you automatically:

• Lend new money on a regular basis. (For Lending Works, you will need to set up a standing order with your bank.)
• Automatically re-lend any interest and loan repayments you receive.
• Automatically re-lend loan repayments only.
• Automatically withdraw interest only. (Getting an income from the interest.)
• Automatically withdraw interest and some of the loan repayments you receive (Getting an income from interest and some of the money you lent.)

Lending Works is one of the lowest-risk P2P lending opportunities paying 5% for three-year lending and 6% for five years.

Read more about both Lending Works and RateSetter in Get Started With the Safest Peer-to-Peer Lending Websites.

And see Lending Works in Deceptively Low-Risk P2P lending Companies.

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