ashtondav
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Post by ashtondav on Oct 2, 2019 15:28:41 GMT
My ballpark for lending through RS is about 6%. I am prepared to have the money on the market for four or five weeks before withdrawing and lending through LW.
The rate on LW is 6.5%, but I consider it riskier than RS so would like to remain in the latter. In a blended RS LW portfolio to get my 6% I could lend at LW at 6.5% and RS at 5.5%.
So do you RS experts expert to see 5.5% on 5 year money in the future given the new products? I’m not talking about 5.5% being the “going rate”, but whether if I set my rate at 5.5% i’m Likely to get a nibble every month or two.
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Post by propman on Oct 2, 2019 16:23:27 GMT
My ballpark for lending through RS is about 6%. I am prepared to have the money on the market for four or five weeks before withdrawing and lending through LW. The rate on LW is 6.5%, but I consider it riskier than RS so would like to remain in the latter. In a blended RS LW portfolio to get my 6% I could lend at LW at 6.5% and RS at 5.5%. So do you RS experts expert to see 5.5% on 5 year money in the future given the new products? I’m not talking about 5.5% being the “going rate”, but whether if I set my rate at 5.5% i’m Likely to get a nibble every month or two. All depends on RS's success on finding borrowers at that rate, not having to load PF contributions for increased bad debt expectations on past lending and particularly how they allocate the loans between Access, plus & Max. Realistically it is only Max that will reach this level more than occassionally. It seems that with the imminence of the availability of the option to fund sales from other markets that they believe that they do not need as much in reserve on rolling. If this carries over to Access, the recent poor lending volumes on 5 year will likely continue on Max and rates will decrease unless lending volumes pick up or more lenders withdraw their funds. Personally I am not willing to lend at 1 year rates in Plus and money was withdrawn when MR on 5 year reached 5.2% in June.
Personally I am happy to reduce P2P lending with the current economic uncertainties. It will b interesting to see if there are material withdrawals as the end of the month approaches.
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Post by redpete on Oct 2, 2019 21:07:24 GMT
At the moment I've had £1000 on LW waiting to be invested since 27th August, so somewhat outside the 14-21 (business day) average they are claiming. This takes it down to no more than 6% over the first year.
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mickj
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Post by mickj on Oct 3, 2019 8:14:24 GMT
and I was thinking my 'offers' placed on 5th September must be getting close - wrong.
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Post by Deleted on Oct 3, 2019 8:25:04 GMT
Looks like the queues for Access, Plus and Max are just split one third each as all amounts at each level are the same after allowing for the 1% differentials.
The 5 year rate is better than the Max rate by about 0.4% but not sure how long that will last. Think I'll be withdrawing as repayments come in.
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tyrex
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Post by tyrex on Oct 3, 2019 9:13:41 GMT
Yep, repayments set to holding a couple of months ago when this was announced. Withdrawing a couple of hundred per month.
I'm not their target investor any more anyway.
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robski
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Post by robski on Oct 3, 2019 9:17:02 GMT
Looks like the queues for Access, Plus and Max are just split one third each as all amounts at each level are the same after allowing for the 1% differentials. The 5 year rate is better than the Max rate by about 0.4% but not sure how long that will last. Think I'll be withdrawing as repayments come in. I dont think so, I think its one queue, (thats what RS said) just showing the 3 rates. So you can lend right now for 4.8% in max but someone may beat you with 2.8% in access. I thought there was about £5-6m on rolling yesterday if the three are split there would have needed to be closer to £15M Actually edit, it must be one queue, no way all those investors are matching 2.8%/3.8%/4.8% and at every margin of 0.1% and up, and also all 3 showing equal amounts of rates you not allowed to set now, but with the 1% offsets
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sl75
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Post by sl75 on Oct 3, 2019 10:42:51 GMT
My ballpark for lending through RS is about 6%. I am prepared to have the money on the market for four or five weeks before withdrawing and lending through LW. The rate on LW is 6.5%, but I consider it riskier than RS so would like to remain in the latter. In a blended RS LW portfolio to get my 6% I could lend at LW at 6.5% and RS at 5.5%. So do you RS experts expert to see 5.5% on 5 year money in the future given the new products? I’m not talking about 5.5% being the “going rate”, but whether if I set my rate at 5.5% i’m Likely to get a nibble every month or two. Personally, I'm indifferent about lending on "5 year" or "max" (was also indifferent about "1 year" and "rolling" when rates are the same, which they rarely were).
Either way, I don't anticipate using the early access function, but letting the underlying loans run to term, and re-investing only when an acceptable rate is available.
I've "temporarily" switched my re-investment settings for "5 year" to go to the new "max" product, so once I've got some money queued in both at the same rate, I can evaluate which I keep as and when either gets close to being matched.
Broadly speaking, the structure of the new products should see "max" matched at 5.5% around as often as "access" / "rolling" is/was at 3.5%. If others share my view that "max" and "5 year" are basically equivalent, this should drive the market rates to be about the same on both so that 5.5% would be matched on "5 year" around as often as it is on "max" and 3.5% is on "access"...
... however an awful lot depends on: - how RateSetter split new loans between the new products and the legacy ones. - how many lenders abandon the legacy products for re-investment and/or new investment in favour of the new ones.
- how many lenders sell out of the legacy products (compared to remaining lenders with offers still active on them)
One thing I'm now kicking myself over is that I'd not put a token £10 investment into the 1 year market in order to ensure it kept open for me - I've now completely lost access to it. Even explicitly navigating to the URL for it results in an error page; RateSetter are seemingly actively blocking access to the legacy markets for those who are not already active in them (curiously, though, I still have access to the 3 year market page even though all loans have now repaid!).
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robski
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Post by robski on Oct 3, 2019 11:36:47 GMT
I haven't used 1 year much so I dont see it as a massive issue to lose it, but the lack of visibility is annoying. Doesn't "feel" right to me You would have needed to keep more than 1 open order as if for any reason that ended you would lose access at that point. Probably 3 current ones would be the minimum level to pretty much guarantee access as long as you were a fairly frequently checking, but as the end of term approached you would need more, since the time left on each loan would be reducing the chances of all three repaying same day would go up.
I agree the Max and 5 year are basically interchangeable, although with the technical difference that you cannot send repayments to holding
Technically there is a risk of getting trapped in Max, but not in 5 year, at least for repayments, meaning you would be forced to withdraw. The risk is 10% lending, the max you can set is 10% and if somehow there were borrowers queued at 10% you would auto match and not be able to set the rate above the point you expected lending to happen.
Right now I dont think they would get too many complaints matching to 10%, but imagine if inflation jumped, BOE interest rates jumped, alternatives jumped, and simultaneously RS hit a bad time with an under provisioned fund. At that point if you were getting a 75% haircut on interest and everything kept going straight back out on loan, you may be a bit less happy at the technical difference between the products
Pretty much a worst case scenario I agree, but I always said when/if there was an interest haircut I would expect the lenders to be looking for higher rates from that point on (those paying attention I mean) and the new products have a slight risk you could be stuck in with the only way out to pay a fee. You are of course reliant on RS moving the going rate to a fair one.
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sl75
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Post by sl75 on Oct 3, 2019 12:04:50 GMT
Right now I dont think they would get too many complaints matching to 10%, but imagine if inflation jumped, BOE interest rates jumped, alternatives jumped, and simultaneously RS hit a bad time with an under provisioned fund. The max isn't 10%, but "5% above the 'going rate'" (i.e. 9% in "plus", 8% in "access" etc.). In circumstances where general interest rates had increased, but RateSetter's "going rate" had lagged behind so far that even offers 5% above the going rate were routinely being matched, I'd expect formal complaints to the regulators to be upheld.
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robski
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Post by robski on Oct 3, 2019 12:17:05 GMT
Maybe, but the going rate (unlike the marketrate) is partly to set the "target" in reference to the borrowers they want to attract don't forget
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Stonk
Stonking
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Post by Stonk on Oct 3, 2019 12:47:46 GMT
Is it just me, or is it unfair that the release fee is dependent on the Going Rate at the time of release? At the time when you commit to invest, you will not know the cost of releasing.
It's a double-whammy if you bought in during a period of low rates and then rates in the economy increase in general. You are stuck in underperforming loans, but the cost to exit them has shot up comapared to your original expectation.
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macq
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Post by macq on Oct 3, 2019 13:12:07 GMT
seen a few people say they have lost access to 1 & 5 year - this is probably obvious but as i missed it at first,does this mean you don't have the Two little(micro size) red buttons below the new product invest boxes to change the page? as seems a bit unfair otherwise
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Post by Deleted on Oct 3, 2019 13:13:56 GMT
Yes, but there are also pink arrows just to the right of the 'Products' heading.
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macq
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Post by macq on Oct 3, 2019 13:29:47 GMT
Yes, but there are also pink arrows just to the right of the 'Products' heading. i must have Pink eye as i missed them as well
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