pikestaff
Member of DD Central
Posts: 2,136 
Likes: 1,484
|
Post by pikestaff on Oct 4, 2017 5:57:20 GMT
Details here (needs a login) members.ratesetter.com/noticeboard/simplifying_early_access_to_invested_moneyReported at (no login required) www.p2pfinancenews.co.uk/2017/10/03/ratesetter-secondary-market-fees/With effect from 2 November, sell out fees will change to a fixed percentage as follows: Rolling nil 1 year 0.3% 3 year 1.0% 5 year 1.5% These are said to be less than the average lenders have been paying. They are also changing terminology: "Deposit" becomes "Money in", "Withdrawal" becomes "Money Out". I see the hand of the FCA in the above changes. Sadly, they are also removing the "Drawdown" function, which they say less than 2% of lenders use. I'm one of them. Grrr. Auto money out, which I also use, is being kept, thank goodness. |
|
jlend
Member of DD Central
Posts: 1,817
Likes: 1,444
|
Post by jlend on Oct 4, 2017 9:20:48 GMT
Thanks for the info.
Does feel better than before.
Didn't the old method result in a large fee for loans that were held for a long time if wanting to sell out?
This new fee structure feels better for those loans unless I have missunderstood.
|
|
|
|
Post by BrianC on Oct 4, 2017 22:25:54 GMT
Great news. I was quoted around 2.6% recently to sell out of 5 year. I was miffed as when I started investing I'd read the average rate was 0.72%. If I do need my money out at any point 1.5% is much better than 2.6% but I'll just keep moving repayments in to rolling for now.
|
|
|
|
Post by GSV3MIaC on Oct 5, 2017 15:25:19 GMT
The problem was that the %age quoted was, I think, the AVERAGE %age of the INITIAL LOAN(s) .. so when the loan is half repaid, you can double it as a %age of the remaining sum .. and also the %age, however you measure it, snuck up over time based on the 'Oh, you've had the 5Yr rate for 4.9 years, but you should only have had the 3 year rate, so that 4.9 years of rate difference you owe us' .. basically a double or triple whammy. Sell out in month, or even year, 1 and it was quite reasonable .. by year 4.9 you'd be better off burning the note.
The new fixed %age charge makes much better sense, although I'd still consider it a ripoff when I release a 5 year loan cut at 6.5%, and some new lender picks it up with 5% money .. what was my 1.5% charge for? If there was an actual SM, I could probably sell out at a PROFIT, not a 1.5% cost.
Oh .. and is the new 1.5% sell out fee calculated on what I withdraw, or the original value of the contracts??
|
|
jlend
Member of DD Central
Posts: 1,817
Likes: 1,444
|
Post by jlend on Oct 5, 2017 15:50:48 GMT
The problem was that the %age quoted was, I think, the AVERAGE %age of the INITIAL LOAN(s) .. so when the loan is half repaid, you can double it as a %age of the remaining sum .. and also the %age, however you measure it, snuck up over time based on the 'Oh, you've had the 5Yr rate for 4.9 years, but you should only have had the 3 year rate, so that 4.9 years of rate difference you owe us' .. basically a double or triple whammy. Sell out in month, or even year, 1 and it was quite reasonable .. by year 4.9 you'd be better off burning the note. The new fixed %age charge makes much better sense, although I'd still consider it a ripoff when I release a 5 year loan cut at 6.5%, and some new lender picks it up with 5% money .. what was my 1.5% charge for? If there was an actual SM, I could probably sell out at a PROFIT, not a 1.5% cost. Oh .. and is the new 1.5% sell out fee calculated on what I withdraw, or the original value of the contracts?? I read it as the fee is now calculated on what you withdraw which is better than before. The original fee in the early days went into the provision fund as an extra source of revenue for the fund which helped a little. That was changed sometime ago in one of the many changes that have been made over the years. The fee is profit for ratesetter which always seems unreasonable to me.
|
|
09dolphin
Member of DD Central
Posts: 630 
Likes: 856
|
Post by 09dolphin on Oct 6, 2017 12:22:52 GMT
Ratestters terms and conditions are "flexible" to say the least. They claim instant transfers are completed within 4 hours. Shame this isn't the case. I transferred money by instant transfer and when it took over 4 hours was criticised for asking why it took over 4 hours.
I would have expected 4 hours to complete the transfer was the maximum but obviously I was wrong!!!!!!
|
|
