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Recently Mogo, the biggest loan originator on Mintos, issued a bond worth EUR 50 million, with an annual interest rate of 9.5%. They also announced that they would buy back many loans from Mintos's investors using this new money since the loans had a 12-14% rate, which is much higher than 9.5%. I was not overly worried about it because only about 15-16% of my Mintos money was invested in Mogo loans and I thought I'd simply reinvest it in other loans.

Well, it didn't turn out that simple. All the free money the investors suddenly had from the Mogo buy-backs meant other loan originators started lowering their interest rates as well. On top of that, Mintos started a refer-a-friend campaign in July which attracted even more investors and more money to Mintos. The result was that interest rates dropped to 7-9% (when they had been 13-15% in May). ...continue reading "How Mogo messed up Mintos and I discovered Envestio"