TheDriver
Member of DD Central
Slightly bonkers
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Post by TheDriver on Sept 4, 2019 6:52:29 GMT
So if I have to sell to get funds out of the five year market will the selling costs remain the same? edit; just seen it’s 90 days interest at going rate so 5%/365*90, for example? So about 1.3% at 5% MR and about 1.5% at 6% going rate? So at 6% I can’t get above 4.5%, so would I not go for access at 4% - or even set a 4.5% rate in access? Not really. The interest is annual, the fee is a one off, and the 5 year remains a fixed 1.5% penalty. So after 3 years the effective rate on Max would be 4.6% at the initial Going Rate (5.5% @6%) and 4.75/5.7 after 5 years. Plus, 4.5 - or even 4% - is well above the intended 3% for the fee-free Access product, and remains to be seen how achievable that becomes. HtH
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Post by Deleted on Sept 4, 2019 7:59:34 GMT
Having spent some time considering these changes I have decided to write a letter of complaint to Ratesetter.
My personal feeling - not the subject of the complaint - is that the whole thing has been “dumped” on investors as a “fait accompli” - take it or leave it. Ratesetter even said as much.
Clearly, this is a change of business model and Ratesetter has now decided to charge for investing in its products in future. And the more you invest, the costlier it becomes (at compound interest rates).
As I have posted elsewhere - in fairness, possibly because of the speed at which this is being done - Ratesetter has “dumped” what they think is a fair amount of detail - but the truth is that many issues and questions exist for many investors.
But the timescale for implementation - less than 1 month - leaves significant doubt that it will be handled properly and I would expect to see many new posts questioning Ratesetter’s approach and management style. (Is a takeover in the “offing”)? (Will they change the company name to - “Inflexbank” or maybe “UltraViolet” to reflect their web design). I am already quite disturbed about losing one day’s investment per week due to their now utterly ineffectively settlement process.
Before I get comment to the effect - “well you know what you can do”, please understand that I am aware of this. I already have funds invested in P2P elsewhere and will decide, as the announcements are put in to practice, whether I will invest future funds in what is effectively a new company and a new business model.
I am already disinvesting from Zopa because of their changes.
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r00lish67
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Post by r00lish67 on Sept 4, 2019 8:20:20 GMT
Having spent some time considering these changes I have decided to write a letter of complaint to Ratesetter. My personal feeling - not the subject of the complaint - is that the whole thing has been “dumped” on investors as a “fait accompli” - take it or leave it. Ratesetter even said as much. Clearly, this is a change of business model and Ratesetter has now decided to charge for investing in its products in future. And the more you invest, the costlier it becomes (at compound interest rates). As I have posted elsewhere - in fairness, possibly because of the speed at which this is being done - Ratesetter has “dumped” what they think is a fair amount of detail - but the truth is that many issues and questions exist for many investors. But the timescale for implementation - less than 1 month - leaves significant doubt that it will be handled properly and I would expect to see many new posts questioning Ratesetter’s approach and management style. (Is a takeover in the “offing”)? (Will they change the company name to - “Inflexbank” or maybe “UltraViolet” to reflect their web design). I am already quite disturbed about losing one day’s investment per week due to their now utterly ineffectively settlement process. Before I get comment to the effect - “well you know what you can do”, please understand that I am aware of this. I already have funds invested in P2P elsewhere and will decide, as the announcements are put in to practice, whether I will invest future funds in what is effectively a new company and a new business model. I am already disinvesting from Zopa because of their changes. I'm still not quite sure what you're complaining about. You've said there are many issues and questions (I'd argue far more answerable questions than actual issues) and that you have concerns about whether they'll do it all properly, but is that really grounds for a complaint? Fair enough if you just want to feed back that you don't like the sound of the new model though. Also not sure what you mean re: "losing one day's investment per week" . Is this re: the new apparently mandatory withdrawal fees for Plus/Max? Not sure how you get to 'one day per week' from that if so.
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Post by propman on Sept 4, 2019 12:45:21 GMT
Having spent some time considering these changes I have decided to write a letter of complaint to Ratesetter. ... I am already quite disturbed about losing one day’s investment per week due to their now utterly ineffectively settlement process. Also not sure what you mean re: "losing one day's investment per week" . Is this re: the new apparently mandatory withdrawal fees for Plus/Max? Not sure how you get to 'one day per week' from that if so. I assume that this is many repayments going through a day later due to slow repayment runs and the interest only being paid for the contracted term leaving a day in transit without interest for repaid money and interest.
1 day's interest at 4%pa (far higher than you are likely to get) is 11p per £000.
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cb25
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Post by cb25 on Sept 4, 2019 12:48:55 GMT
propman "1 day's interest at 4%pa (far higher than you are likely to get) is 11p per £000" - I'd like 11p per £0, as I have tons of £0 amounts to invest
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Post by propman on Sept 4, 2019 12:51:34 GMT
propman "1 day's interest at 4%pa (far higher than you are likely to get) is 11p per £000" - I'd like 11p per £0, as I have tons of £0 amounts to invest £000 is an abbreviation for thousand's of pounds and different from £0 I am sorry to say!
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cb25
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Post by cb25 on Sept 4, 2019 12:52:28 GMT
propman "1 day's interest at 4%pa (far higher than you are likely to get) is 11p per £000" - I'd like 11p per £0, as I have tons of £0 amounts to invest £000 is an abbreviation for thousand's of pounds and different from £0 I am sorry to say! OK, confused me as I typically use £1000s
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Post by markimus on Sept 4, 2019 13:15:56 GMT
So I sent an email to customer service to enquire if there was a way you could withdraw your money from plus or max without incurring the charge, in the FAQ it says its always reinvested so I wanted to get some clarity.
The response I got was:
Should you choose to invest into the Plus or Max product, should you wish to withdraw your investment, the access fees will apply. There is no option to have repayments moved into your holding account with the new products.
It seems a bit backwards that you can't just have your money return to your holding account, and instead have to pay a fee for its release, I hope they change that, or at least make it so you can gradually move it into the Access product instead.
Edit: fixed a typo
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jlend
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Post by jlend on Sept 4, 2019 13:37:50 GMT
So I sent an email to customer service to enquire if there was a way you could withdraw your money from plus or max without incurring the charge, in the FAQ it says its always reinvested so I wanted to get some clarity. The response I got was: Should you choose to invest into the Plus or Max product, should you wish to withdraw your investment, the access fees will apply. There is no option to have repayments moved into your holding account with the new products. It seems a bit backwards that you can't just have your money return to your holding account, and instead have to pay a fee for its release, I hope they change that, or at least make it so you can gradually move it into the Access product instead. Edit: fixed a typo In the new products you can set your own rate for reinvestments, up to 5% above the Going Rate. Do this, then cancel any unmatched orders. From RS: "1 – Unmatched money can be withdrawn without paying a fee. The fee is limited to investments in Plus and Max that need to be ‘released’ and matched to new investors."
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Post by Deleted on Sept 4, 2019 13:38:51 GMT
So I sent an email to customer service to enquire if there was a way you could withdraw your money from plus or max without incurring the charge, in the FAQ it says its always reinvested so I wanted to get some clarity. The response I got was: Should you choose to invest into the Plus or Max product, should you wish to withdraw your investment, the access fees will apply. There is no option to have repayments moved into your holding account with the new products. It seems a bit backwards that you can't just have your money return to your holding account, and instead have to pay a fee for its release, I hope they change that, or at least make it so you can gradually move it into the Access product instead. Edit: fixed a typo You'll be able to set your reinvestment rate high though and then cancel the order and withdraw the repaid funds. Bit of a faff I know. I see the main differences between {Plus and Max} and {1yr and 5yr} as the different early access fees (but still similar) and that there will be no option to return repayments to holding or switch markets automatically (presumably RS is hoping inertia will mean more funds are retained). In addition, the Going Rate is set by RateSetter and the markets are pooled for liquidity but they are back-end changes.
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Post by Ace on Sept 4, 2019 13:40:17 GMT
So I sent an email to customer service to enquire if there was a way you could withdraw your money from plus or max without incurring the charge, in the FAQ it says its always reinvested so I wanted to get some clarity. The response I got was: Should you choose to invest into the Plus or Max product, should you wish to withdraw your investment, the access fees will apply. There is no option to have repayments moved into your holding account with the new products. It seems a bit backwards that you can't just have your money return to your holding account, and instead have to pay a fee for its release, I hope they change that, or at least make it so you can gradually move it into the Access product instead. Edit: fixed a typo As others have said, there is a way to access repayments for free. Just set your required investment rate to the max (5% above the going rate) and they will with build up in your holding account (where you can withdraw them for free) or they will be invested in new loans at a very high rate. Edit: crossed with above.
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Greenwood2
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Post by Greenwood2 on Sept 4, 2019 14:38:09 GMT
So I sent an email to customer service to enquire if there was a way you could withdraw your money from plus or max without incurring the charge, in the FAQ it says its always reinvested so I wanted to get some clarity. The response I got was: Should you choose to invest into the Plus or Max product, should you wish to withdraw your investment, the access fees will apply. There is no option to have repayments moved into your holding account with the new products. It seems a bit backwards that you can't just have your money return to your holding account, and instead have to pay a fee for its release, I hope they change that, or at least make it so you can gradually move it into the Access product instead. Edit: fixed a typo As others have said, there is a way to access repayments for free. Just set your required investment rate to the max (5% above the going rate) and they will with build up in your holding account (where you can withdraw them for free) or they will be invested in new loans at a very high rate. Edit: crossed with above. I think the unlent funds will stay in your lend order (not move to holding) until you cancel the order. How you cancel the order remains to be seen, the T&Cs refer you to closing your account to see how to cancel a lend order, but I don't think it explains how or if this is only possible if you intend to close your account.
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ashtondav
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Post by ashtondav on Sept 4, 2019 16:13:46 GMT
Yes, re reading the new T&C “cancelling an order” directs you to “closing your account”. Athough it’s not explicit. So apart from Access you’re going to pay for a withdrawal. 90 days loss of interest is punitive, unfair, and insulting. But this is a massive boost for their shareholders as RS will see at least 1% of the (non access) loanbook drop straight to the bottom line (as there are no additional costs incurred.) This provides a huge boost in earnings visibility - unless no one ever withdraws money.
This new product malarkey may stink like a dead rat but bloody hell its commercially brilliant.
IPO baby, IPO.
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IFISAcava
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Post by IFISAcava on Sept 4, 2019 16:58:49 GMT
Presumably, all existing loans can be drawn down over the terms of the loans with no fees, if reinvestment is not allowed (isn't yet clear to me if it will). Bit of a pain for the ISA, mind you. If rates are uncompetitive (seems likely at current levels) I think the strategy will be to reinvest in the Access on repayment of current loan installments, then transfer out in batches. Loan Pad, AC, LW would seem to be the obvious fire and forget ISA alternatives.
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Post by df on Sept 4, 2019 17:29:05 GMT
"We believe good products are simple, with a consistent experience." - so do I, but can't help comparing to some other platforms: GS - 1 product @5.3%, free withdrawal after 1 month. LW - 2 products: 5% instant access and 6.5% 0.5% withdrawal fee. These are much more simple and paying better rates.
Trying to put it all into a simple picture, please correct me if I'm wrong. There will be 6 RS accounts: 1. Access (replacement for Rolling) 2. Plus (ditto) 3. Max (ditto) 4. 1-year (discontinued, but still running for existing customers until loans are repaid). 5. 5-year (ditto) 6. Rolling (ditto)
I'm in Rolling and 5-year atm. Am I correct to think that if I set my reinvestments to highest possible rates and do regular cancelations/withdrawals I'll be able to gradually run my loan book down without paying any fees like I do with my Access and Classic Zopa accounts?
Another thing, a bit out of topic. I'm not sure if 3% is a suitable rate for p2p investment. This is not very far from what you can get from FSCS accounts. 1% extra makes sense if you have 7 figure to invest, but I doubt many millionaires invest in RS... I think most ordinary p2p investors who requires fee free instant access will find other accounts (QAA for example is more simple and pays 4.1% for roughly the same level of risk) more attractive than RS's Access.
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