Latvia p2p lending marketplace Mintos announced today that it expands and now offers p2p loans – secured by cars as collateral to borrowers in Lithuania. This is the third country Mintos operates in after Latvia and Estonia. Mintos is open to international investors from Europe – the website states 1,200 registered investors from 26 countries.
The car loans in Lithuania are originated in cooperation with Mogo – a partner Mintos is already using in Estonia, where they together funded 250 car loans for a total of 300K EUR.
When investing in secured car loans investors enter in a direct contract with a borrower – similar to real estate backed loans the contract with respective borrower is transferred from Mogo to investor based on assignment. According to assignment agreement, part of the interest that borrowers pay is not assigned to investors and remains with Mogo to compensate it for loan origination and servicing.
I checked the loan listings – there are currently 9 Lithuanian loans secrued by cars listed with nominal interest rates in the range from 8 to 15% and loan terms of 6 to 71 month.
Earlier this month Mintos waived service fees for investors – only a fee for those selling on the secondary market remains.
As an investor, I don’t approve their heavy move towards car loans. It looks like Mogo is offloading their loan book and investors are not provided with information of how loans are selected from massive loan book.
While investing their money, investors should have in mind that Mintos belongs to the largest payday loan provider in the Baltics.