rscal
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Post by rscal on Jul 12, 2019 9:34:16 GMT
I'm assuming that the 'early' repayment loans are due to the sale of a secured asset (where timing is not under the control of the borrower) whilst the 'on anniverssary' loans aren't being repaid but rather 'rolled' for a further 12 months (in nearly all cases) in the 1 year market.
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Stonk
Stonking
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Post by Stonk on Jul 12, 2019 9:49:23 GMT
I'm assuming that the 'early' repayment loans are due to the sale of a secured asset (where timing is not under the control of the borrower) whilst the 'on anniverssary' loans aren't being repaid but rather 'rolled' for a further 12 months (in nearly all cases) in the 1 year market. On RS you cannot tell, but you are probably correct.
I believe the 1 Year loans tend to be for property development (hence no monthly repayments). It would be very unlikely for the development to be finished and sold precisely at the 1 year point. They'll either complete before 1 year, in which case presumably the loan is (has to be?) repaid; or after 1 year, in which case a new loan is taken.
I don't think there's anything wrong with this. Who can judge a property development and sale to the day a year into the future!
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Post by propman on Jul 12, 2019 11:20:49 GMT
In practice different finance is often taken on after practical completion for units not pre-sold as the asset becomes tradeable and the risk reduced.
Early repayment may also occur if the amount to be drawn down becomes excess to requirements (eg loan includes initial build costs but build not proceeding to initial timetable due to market or planning issues).
- PM
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woodie
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Post by woodie on Jul 12, 2019 16:04:26 GMT
Contacted Ratesetter Customer Services for clarification
Q ... In the 1 year market are initial loans distributed to lenders restricted to a maximum of 1 year? In other words are lenders exposing themselves to loans with a longer duration than 1 year.
A ... Thank you for your email. I can advise that loans in the one year market will only be matched to loans up to a year.
In the year of Brexit a straight answer ... MPs please note.
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aju
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Post by aju on Jul 12, 2019 16:07:41 GMT
Contacted Ratesetter Customer Services for clarification Q ... In the 1 year market are initial loans distributed to lenders restricted to a maximum of 1 year? In other words are lenders exposing themselves to loans with a longer duration than 1 year. A ... Thank you for your email. I can advise that loans in the one year market will only be matched to loans up to a year. In the year of Brexit a straight answer ... MPs please note. Yes but is it the correct one!, i'll let you know in a years time
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rscal
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Post by rscal on Jul 13, 2019 5:43:51 GMT
Contacted Ratesetter Customer Services for clarification Q ... In the 1 year market are initial loans distributed to lenders restricted to a maximum of 1 year? In other words are lenders exposing themselves to loans with a longer duration than 1 year. A ... Thank you for your email. I can advise that loans in the one year market will only be matched to loans up to a year. In the year of Brexit a straight answer ... MPs please note. I think the question should have been: when a borrower repays their loan exactly on the anniversary of their loan, is Ratesetter involved in any way in arranging its refinance? Or - is refinance by Ratesetter (which would allow the borrower's loan 'to roll') ruled out by the terms of the borrower's agreement? In other other words, does the borrower in the one year market only have the option to repay the Ratesetter loan with a different source of funds?
My practical interest is that I have loans due to repay on Frinday but it would be nice - and often happens IME - if those loans got repaid a couple of days early so I can beat the weekend wait to draw the funds out. No every 1 year loan contract repays 2 days early but many do, so there's a pattern there suggesting a practice on some one other than the borrower's part (I'll put it no stronger than that.)
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Post by propman on Jul 13, 2019 10:48:25 GMT
Contacted Ratesetter Customer Services for clarification Q ... In the 1 year market are initial loans distributed to lenders restricted to a maximum of 1 year? In other words are lenders exposing themselves to loans with a longer duration than 1 year. A ... Thank you for your email. I can advise that loans in the one year market will only be matched to loans up to a year. In the year of Brexit a straight answer ... MPs please note. I think the question should have been: when a borrower repays their loan exactly on the anniversary of their loan, is Ratesetter involved in any way in arranging its refinance? Or - is refinance by Ratesetter (which would allow the borrower's loan 'to roll') ruled out by the terms of the borrower's agreement? In other other words, does the borrower in the one year market only have the option to repay the Ratesetter loan with a different source of funds?
My practical interest is that I have loans due to repay on Frinday but it would be nice - and often happens IME - if those loans got repaid a couple of days early so I can beat the weekend wait to draw the funds out. No every 1 year loan contract repays 2 days early but many do, so there's a pattern there suggesting a practice on some one other than the borrower's part (I'll put it no stronger than that.)
I think the repayment of the loan is not fundamental. AIUI Ratesetter would write a new loan. If they had insufficient funds to refinance, they couldn't agree to rollover. If the borrower couldn't refinnce any other way or repay, they would default. This would then trigger a claim on the PF and so a lender would get repaid subject to any haircut imposed on all lenders. This si different from other arrangements elsewhere when the platform can extend unilaterally.
- PM
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rscal
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Post by rscal on Jul 16, 2019 19:31:29 GMT
Update: Those 1 year loans I mentioned did get 'repaid' early as hoped for - Tuesday instead of Friday
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