Brockton, MA · Member since 2019 · 26 posts · 9 votes
Hello all,
I have been looking at this new CD for a few months now. My research says it’s legitimate, can’t find anything saying otherwise online. Anyone using this? A 1 month CD returning 6% seems too good to be true but I’d love to park some of my savings ($20k ish)in there and collect $100 in interest every month.
Here’s a link
https://myloan.doctor/hcf-high-yield-cd-account/
Would love to hear from anyone who has used or anyone who has thoughts on it.
New york, NY · Member since 2014 · 74 posts · 3 votes
6y
I stumble upon that article too when I was looking for a safe investment with good yield of return.
My first thought was it is a CD savings account that is insured by FDIC. But, there was someone on one of my research pointed out that the CD itself is not insured by FDIC, which was written on their website FAQ:
"The security of the HCF Savings Note is ensured as it is backed by cash and cash equivalent funds that are FDIC insured and an additional $100MM umbrella through Lloyds of London, making it as safe as a savings account or CD."
This product was pretty new launched on 8/22/19. My approach would be to try it out for a few months to a year and withdraw most of the money and then leave a small amount ($1K - $5K-ish).
I made a small deposit. So far everything seems legit. Interest paid to the account on time. I have a small withdrawal set up for the first part of March, so I will see how that goes. If everything goes well with that I will probably deposit more. If anyone with more financial knowledge has some input I and i'm sure many others would love to hear it. I've seen a few stupid comments on reddit about some guy in his moms basement creating the whole thing. Obviously that's not the case! I'll post here a reply I received from them after asking a few questions
Thank you for being a valued Loan Doctor Financial client, we appreciate your business and certainly appreciate referrals of friends, family and colleagues as well. I would be happy to answer your questions.
Yes, if something were to happen to Loan Doctor, the funds would indeed be safe. This is because the CD deposits are backed by cash and cash equivalents at all times, so if tomorrow every single client wanted to make a full withdrawal, it would be possible. Loan Doctor does not use leverage, nor does it use any of the CD deposit funds for its company operations (salaries, technology, marketing etc.), which are completely segregated. In the unlikely event that Loan Doctor could not continue operating, and had to shut down, the cash and cash equivalents backing the CDs would be distributed by an independent administrator in full to all the CD holders. This is a standard process of winding down/receivership that would apply to a bank, credit union or other financial institutions like Loan Doctor.
I hope that answers your questions, let me know if I can help with anything else.
Bjorn, what does that mean? Do you have any reason to believe this company isn't legit? If so I would love to hear it before I really invest! Evidence or past experience? Otherwise its just a comment that isn't helpful.
Investor · Singapore · Member since 2013 · 1k+ posts · 3k+ votes
6y
Looks very interesting. They use the deposits to originate the loans to doctors and then resell them to institutional investors. Thats why the lock in term of the deposit can be as low as 1 month. 6% APY probably assumes you keep the money for the full year and reinvest the interest. I doubt though that its guaranteed in any real way. So I would treat it like any other lending fund investment in terms of risk
I received an email from loan doctor giving me the cd info that the money I give them is in a cd at bank of America. I went to bank of America and they said it was a scam. This is what they sent me.
When under the FDIC insurance, they are at Bank of America and/or Signature Bank. The FDIC certificate numbers are below:
Bank of America: 25178 Signature Bank of NY: 57053.
After I called loan doctor and told them what bank of America had said they sent me this.
The certificate for Bank of America that you were provided is indeed correct, as I was able to pull it up on the FDIC website itself, which you can do so as well: https://research2.fdic.gov/bankfind/ and then type in the FDIC certificate.
When you go to that site it has cd info but nothing that says loan doctor. I emailed loan doctor and asked them about this and they never responded.
I would like to put some money and my daughter would like to but I don't want to lose it.
Correct me if im wrong. But wouldn't you expect to see the name of the bank that is holding the cd to show up when doing the fdic certificate search? If I opened a CD with a bank and searched for their certificate my name would not show up. Thanks for posting and please keep the conversation going. 6% is an awesome rate and im sure it would help out alot of people. Also encourage some other financial instutions to up their game. If indeed this isn't as safe as the company makes it out to be, then it needs to be known. They are claiming there is no risk what so ever. Is there an instution that does research on companies to determine their ligitimacy? A search for loan doctor on the BBB websight doesnt reveal much. I dont know if that indicates anything or not.
Investor · Singapore · Member since 2013 · 1k+ posts · 3k+ votes
6y
Ok. I looked more into this and also had my financial advisor take a look. It doesn't seem to be a scam. The business model as I understand it is as follows. You deposit money and commit to one month term. They use the money to make a loan to a doctor and then sell it to an institutional investor. In reality of course they don't do one loan at a time but your money is pooled with others. The origination fees etc are about 7-8%, about 6% of which they return to the investors and the rest is their profit. Thats easy enough to understand. They also claim that the keep cash equivalent reserves in longer term CD's to back up investor money. So if they have $1M in deposits they keep another $1M in a long term FDIC guaranteed CD. So that in fact is the "guarantee".
I saw this also and did some research. I think it terms of safety it's somewhere between a bank and something like Prosper or other P2P lenders. They also said they will be BBB accredited soon. Not sure if that's true or not, but if it is that's certainly a big plus in my book because it's a pretty intensive process to get that (I had to do it with a plumbing business I owned and they wanted invoices, customer references, financials etc).
My main concern is that I think the 6% is really a promotional rate. Maybe it stays like that for a year or two, but its probably there to attract capital, and then it might go down. Not to say that I don't want to take advantage of it while it's there, but I wouldn't base my whole retirement plan on earning that for the next 20 years.
I also went to my local Bank of America branch. I'm not sure what Dorinda is saying because what they told me is that the certificates numbers are correct and Loan Doctor has an account with them so I could make a deposit to it, but they don't discuss customer's business beyond that. The person I spoke to also said that any partnerships they have are decided at the corporate level so local branch has nothing to do w it at all and don't really have any info. They did confirm that whatever funds LD holds with them in their BoA account are FDIC insured under that certificate that Dorinda posted. I did ask them if I give Loan Doctor money am I insured directly by Boa and they said that no, to do that i have to open a CD directly with BoA.... of course I checked their CD rates and it's 0.10% lol id rather buy a US treasury ETF than subsidize their $25 million dollar CEO salary....
Ok so i started with 1k initially, then added 4k and setup a withdrawal for 4k after it matures. And it did transferred funds back to my personal bank account with no issue i again added 19k to my loan doctor account 15 days ago it seems good so far will let you all know if i find something fishy.
I stumbled across My Loan Doctor's high yield CD today. It is now advertised at 5.25% apr, down from 6%. Still extremely high for something described as no risk. Anyone having issues now with the company?
Do you know if they are registered with the SEC? Worthy bonds are being sold with a promised 5% apr compounded daily. That company is registered with the SEC and backed by secured small business loans. I've read that their loans are asset collateral secured loans, better than unsecured loans like lending Club. Also they have no fees and u can withdraw whenever. Both my loan doctor and worthy bonds seem similar, just different sector of the market.
anyone know how my loan doctor's interest is compounded? Thanks.
Any updates? I saw they closed HCF to new investors. With everything going on ( economy, coronavirus) do you still feel it is safe investment. I put in several thousand last month And see interest accumulating but don’t know if it is too good to be true now ( with fed rate being so low).
I don't have money in it but i would be more concerned if they were trying to get more money in now than if they close to new investors. pyramid schemes thrive on NEW money coming in. Nobody ever closes one. So at least from that seems legit if the economy is doing worse and they are concerned they won't lend as much, they dont want to take on more money that they can't put to work right?
Hi, is there a better place to put money, I'm 73yo.
Well, a year ago I would have said REITs lol. They have been price stable for years paying good income (better than Loan Doctor). But what was once the safest, has done the worst in this market (REITS are down 70-80% this year!). REITs are basically the lazy real estate investors' dream...now a nightmare.
Self owned real estate is obviously great too, but it takes a lot of work. I have a few properties and recently my property manager stopped responding. No rent for the last month even before Covid ..... I live out of state so now I am scrambling to figure out wtf is going on. If you can dedicate yourself to full time property management, with a good NOI cushion, that is absolutely the best way to go!
The bottom line is you have to either work very hard to grow your money, or take some risk. Right now banks are paying nothing. Personally, I think stocks will recover but please don't take that as advice because we are very different age.... they could drop another 30% and not recovery for many years, so it might not be safe for you at all.