rscal
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Post by rscal on Jun 4, 2018 8:53:33 GMT
I noticed Rolling was matching at 1.8% a couple of days ago! In the new process monthly repayments will be reinvested, although interest can be retained. Therefore it seems to me capital will be permanently invested unless it's withdrawn, because each monthly repayment will be placed into new loans. Therefore the length of the original loan is irrelevant because by the time it finishes the capital will all be in other loans! I appreciate your uncertaintly. There is the fall back that reinvestment can at present be set to 'holding' (so I've done that today because tomorrow by coincidence at big chuck of 'monthly' is due.) Now as to 'rate' if the loan periods are dispersed but there is only a single rate set by RS themselves that is presumeably a 'blending' of the whole market they serve, since they set higher rates for longer loans and lower rates for shorter ones. Who knows from which source of borrowers (in which loan lengths) we presently benefit in this market? The proof will be in the pudding. On the other hand, since the loan is for a variable period but at a fixed rate (the daily Market rate) I can't see that raising rates.
Indeed the whole thing ranks.
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TheDriver
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Post by TheDriver on Jun 4, 2018 18:36:04 GMT
According to the revised terms published yesterday:
So it seems that there won't be an option to have Rolling Market capital repayments sent to the Holding Account. They'll be re-invested in perpetuity at Market Rate, unless a withdrawal request is made (which would then trigger the 14-day 'fair usage' clause).
I'm presuming - perhaps incorrectly - that Rolling Market interest payments sent to the Holding Account first are deemed to be 'new funds' i.e. they can then be lent via the Rolling Market at a user-set rate.
Well, I eventually found the new Investor terms, but it was a struggle - they aren't under the Ts & Cs where you might expect, and I had quite a trek thru the RS site before I located them hidden under about 5 pages of Key Information! Does anyone know a direct link on the site, or do I need a bookmark?!? I am intrigued to know how small repayments will be dealt with for reinvestment, because para 4.12 says the minimum loan size remains at £10. Whilst that allays some of my concerns regarding smaller and smaller miniscule loans, it isn't stated how these small amounts are aggregated - RateSetter? The same paragraph also says 1 year repayments will be directed to Rolling - does this signal the beginning of the end for that product?
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Post by yorkman on Jun 4, 2018 21:49:58 GMT
So have I got this right?
The 'Rolling' Market is now exactly the same as the 5 year market except that you don't get a proportion of your capital back each month.
Also when you invest in Rolling you will no longer know how long you will be investing for - 'Fixed' Term takes on a whole new meaning!
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amphoria
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Post by amphoria on Jun 4, 2018 21:59:08 GMT
According to the revised terms published yesterday:
So it seems that there won't be an option to have Rolling Market capital repayments sent to the Holding Account. They'll be re-invested in perpetuity at Market Rate, unless a withdrawal request is made (which would then trigger the 14-day 'fair usage' clause).
I'm presuming - perhaps incorrectly - that Rolling Market interest payments sent to the Holding Account first are deemed to be 'new funds' i.e. they can then be lent via the Rolling Market at a user-set rate.
Well, I eventually found the new Investor terms, but it was a struggle - they aren't under the Ts & Cs where you might expect, and I had quite a trek thru the RS site before I located them hidden under about 5 pages of Key Information! Does anyone know a direct link on the site, or do I need a bookmark?!? I am intrigued to know how small repayments will be dealt with for reinvestment, because para 4.12 says the minimum loan size remains at £10. Whilst that allays some of my concerns regarding smaller and smaller miniscule loans, it isn't stated how these small amounts are aggregated - RateSetter ? The same paragraph also says 1 year repayments will be directed to Rolling - does this signal the beginning of the end for that product? In my account they can be accessed from the left hand menu under Investor Terms from most (if not all) pages. The full Investor Terms appear below the Key Information.
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amphoria
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Post by amphoria on Jun 4, 2018 22:03:38 GMT
So have I got this right?
The 'Rolling' Market is now exactly the same as the 5 year market except that you don't get a proportion of your capital back each month.
Also when you invest in Rolling you will no longer know how long you will be investing for - 'Fixed' Term takes on a whole new meaning! It is believed that the contracts are amortising, ie. you do get a proportion of your capital back each month. Also they differ from the 5 year in that you can sell fee free subject to buyers being available. However, you are right in that you do not know the length of the contract.
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Post by yorkman on Jun 5, 2018 9:31:38 GMT
So have I got this right?
The 'Rolling' Market is now exactly the same as the 5 year market except that you don't get a proportion of your capital back each month.
Also when you invest in Rolling you will no longer know how long you will be investing for - 'Fixed' Term takes on a whole new meaning! It is believed that the contracts are amortising, ie. you do get a proportion of your capital back each month. Also they differ from the 5 year in that you can sell fee free subject to buyers being available. However, you are right in that you do not know the length of the contract.They might technically be amortising but you don't get to see to control the capital repayments as they are immediately reinvested at the same rate as original loan (but obviously in a different loan). At least that what RS appears to be saying. Not that it's clear.
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TheDriver
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Post by TheDriver on Jun 5, 2018 9:53:06 GMT
So have I got this right?
The 'Rolling' Market is now exactly the same as the 5 year market except that you don't get a proportion of your capital back each month.
Also when you invest in Rolling you will no longer know how long you will be investing for - 'Fixed' Term takes on a whole new meaning! As far as I can see, the only equivalence to the 5 year market is that the loans are amortising. To my mind "Rolling" was never a meaningful renaming of the "Monthly" product, but now it makes sense because loans automatically roll over into new ones until a withdrawal is made. Hence there is NO term, just ongoing. I don't have a problem with that principle, or the 14 day investment pause - if you need to withdraw money it's unlikely to be replaced within 14 days except in the "playing the market" scenario RS are intending to stop. It just seems unnecessary to force market rate on everyone if such a large proportion of lenders really do already use that, as all I can see happening is rates drifting down (new money can only get lent by undercutting MR) until the surplus disappears, causing a magnified spike in rates! PS Thanks for pointing out the link, amphoria . I was slightly misled because if I pick "Investor Terms" from the footer menu it brings up Ts & Cs!
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amphoria
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Post by amphoria on Jun 5, 2018 13:45:07 GMT
It is believed that the contracts are amortising, ie. you do get a proportion of your capital back each month. Also they differ from the 5 year in that you can sell fee free subject to buyers being available. However, you are right in that you do not know the length of the contract.They might technically be amortising but you don't get to see to control the capital repayments as they are immediately reinvested at the same rate as original loan (but obviously in a different loan). At least that what RS appears to be saying. Not that it's clear. yorkman - I would appreciate it if you added your comments is such a way that they don't appear to be from me. The last 3 sentences of the above paragraph are not mine. Change to the BBCode tab if you can't work out where to add your comments.
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TheDriver
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Post by TheDriver on Jun 5, 2018 14:42:17 GMT
It is believed that the contracts are amortising, ie. you do get a proportion of your capital back each month. Also they differ from the 5 year in that you can sell fee free subject to buyers being available. However, you are right in that you do not know the length of the contract. They might technically be amortising but you don't get to see to control the capital repayments as they are immediately reinvested at the same rate as original loan (but obviously in a different loan). At least that what RS appears to be saying. Not that it's clear. No in both cases: 1. They ARE amortising, because they will have been paid into your RS account, thereby reducing the amount outstanding; RS then forces capital reinvestment into ANOTHER loan, and; 2. Reinvestments are at the MR current at that time, which might be different - and I predict will drift lower until the bottom falls out of the market! However, I suspect the "complication" RS referred to in their justification for the change is actually the cash-drag between each month's allocation. It still hasn't been explained how reinvestment vs new investment will be prioritised, or the impact on queuing. Can we assume a simple time/rate system?
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Post by yorkman on Jun 5, 2018 15:08:06 GMT
yorkman - I would appreciate it if you added your comments is such a way that they don't appear to be from me. The last 3 sentences of the above paragraph are not mine. Change to the BBCode tab if you can't work out where to add your comments. Hi - I've always managed that before . No idea why they added as they did. Apologies.
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Post by GSV3MIaC on Jun 5, 2018 18:29:59 GMT
It's a frequent/known problem with quoting, although nobody seems to know what causes it .. the only solution I know of is to drop out into BBCode, at which point you can actually add comments to the end, outside the quote marks. If you spot it too late, after typing reams, you can also manually move the "endquote" marker (in BBCode view) to where it ought to be.
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Post by fiatlender on Jun 5, 2018 23:20:26 GMT
So the loan term remaining (months) is now visible on rolling loans. Attachments:
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happy
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Post by happy on Jun 6, 2018 6:28:14 GMT
So the £3,000 rolling repayment that I was expecting today from Rolling has been automatically reinvested at todays market rate of 3%. So all money currently in Rolling is captured in the new "Fairer" system not just money we invest from today. Thanks for making that clear to everyone RS.
What really gets me mad about this latest move by RS, apart from them dressing things up to make it look like they are doing all this for our benefit, is that I now have no choice over the capital and interest repayments coming from my old 3 year loans, they have to go to rolling and to get them back I would force an investment pause in Rolling and therefore suspend my free choice to set my own rate on this and any other money I would like some control over.
Why? I never signed up for that RS. Do you even care what I think? Almost certainly NO....
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jlend
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Post by jlend on Jun 6, 2018 7:00:44 GMT
So the loan term remaining (months) is now visible on rolling loans. It would be good if they included a column for the interest repayments for those people who set the interest to be repaid to their holding account.
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TheDriver
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Post by TheDriver on Jun 6, 2018 7:36:02 GMT
So the £3,000 rolling repayment that I was expecting today from Rolling has been automatically reinvested at todays market rate of 3%. So all money currently in Rolling is captured in the new "Fairer" system not just money we invest from today. Thanks for making that clear to everyone RS. What really gets me mad about this latest move by RS, apart from them dressing things up to make it look like they are doing all this for our benefit, is that I now have no choice over the capital and interest repayments coming from my old 3 year loans, they have to go to rolling and to get them back I would force an investment pause in Rolling and therefore suspend my free choice to set my own rate on this and any other money I would like some control over. Why? I never signed up for that RS. Do you even care what I think? Almost certainly NO.... The inconspicuous Notice Board notification of the change clearly says: "So, from the 6th June, when your investment is matched to a borrower it will remain matched to that borrower . . . . ", nothing about reinvesting previous repayments. Obviously in their "excitement" to implement the new system someone has mishandled the transition. At least you should be able to recover the funds on a LIFO basis - although that will presumably attract the 14 day reinvestment delay into Rolling. Will be interesting to see what happens by the time my current parts start expiring on the 12th!
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