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Post by batchoy on Dec 17, 2013 14:14:59 GMT
In lieu of a board, I'll start a thread. First of all hello wellesleyco and welcome to the forum. As yet I have only signed up to your site and not invested whilst I due my personal due diligence bit. Just a few of questions having signed up: - It appears that you are selling bonds which have asset back loans assigned to them rather than direct shares in loans it this correct?
- Secondly lenders appear to have the double security of assets and a protection fund again is this correct?
- Thirdly and my final question for the moment the T&C mention an administration fee for using the early access service could you clarify what this fee is as I can't see it mentioned anywhere else on your Site?
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Post by wellesleyco on Dec 17, 2013 16:09:14 GMT
Thank you for your questions.
We are not selling bonds, we make asset backed loans and then assign them to each platform user. It is similar to the process in the secondary markets at Zopa or Ratesetter, whereby if someone was to withdraw their funds, the loan is then reassigned to the new lender.
Yes lenders have double security. The loan secured against an asset allows us to sell the asset in the event of a default to recover losses of capital and interest. The Provision Fund is an added level of security in the unlikely event that the amount recovered does not cover the loan. our current average loan-to-value is 63% therefore theoretically, it should not result in this. Also the provision fund allows us to carry on paying interest during the process of recovering an asset.
The 'administration fee' that is charged is aimed to adjust the interest rate that you have received, to the appropriate percentage that you would have earned on the shorter term. The fee is not designed to be punitive, similarly it will never be more than the value of interest earned. Therefore this charge will never reduce the total amount of capital that you have lent. This fee varies from term to term and as interest rates vary and at what time in the term early access is requested. The fee will be displayed at the time and requires confirmation of acceptance.
I hope this has answered your questions. We welcome anymore that you or others may have.
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Post by batchoy on Dec 17, 2013 16:28:23 GMT
Thank you for the clarification. Only one minor niggle so far, I assume the Lender Agreement available from the link at the bottom of the your homepage is the same text that appears in the frame on the registration page, as the one on the registration page is difficult to read due to it being squashed in a box.
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Post by wellesleyco on Dec 17, 2013 17:06:38 GMT
Thank you for the feedback. It is the same lender agreement as in that box in registration and I agree with you, that box is not very user friendly. I have raised the issue with management and as part of trying to make the whole registration page more fluid we hope to have this all sorted in January.
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Post by elljay on Dec 17, 2013 19:00:19 GMT
Your wish...
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Post by batchoy on Dec 17, 2013 19:59:58 GMT
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Post by batchoy on Dec 18, 2013 10:36:06 GMT
A little bit of toe dipping this morning. The money transferred quickly and easily, initiated at 08:00 and had arrived by 10:00, investment was simple and straight forward with a choice of Ratesetter style bonds (for want of a better word) available on 18 month, 3 year, 4 year and 5 year terms with a choice of monthly or term interest payments not huge returns (5.50% to 7.00%) but with minimum purchase of £10.
I have to say I like the idea of having to reconfirm acceptance the T&C each time you purchase a bond but just as with registration having it squashed in a box makes it hard to read.
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Post by yorkshireman on Dec 21, 2013 12:04:44 GMT
A little bit of toe dipping this morning. The money transferred quickly and easily, initiated at 08:00 and had arrived by 10:00, investment was simple and straight forward with a choice of Ratesetter style bonds (for want of a better word) available on 18 month, 3 year, 4 year and 5 year terms with a choice of monthly or term interest payments not huge returns (5.50% to 7.00%) but with minimum purchase of £10. I have to say I like the idea of having to reconfirm acceptance the T&C each time you purchase a bond but just as with registration having it squashed in a box makes it hard to read.
Yes, I would second Batchoy’s comments having done a bit of toe dipping myself.
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Post by yorkshireman on Dec 29, 2013 18:44:45 GMT
A little bit of toe dipping this morning. The money transferred quickly and easily, initiated at 08:00 and had arrived by 10:00, investment was simple and straight forward with a choice of Ratesetter style bonds (for want of a better word) available on 18 month, 3 year, 4 year and 5 year terms with a choice of monthly or term interest payments not huge returns (5.50% to 7.00%) but with minimum purchase of £10. I have to say I like the idea of having to reconfirm acceptance the T&C each time you purchase a bond but just as with registration having it squashed in a box makes it hard to read.
Yes, I would second Batchoy’s comments having done a bit of toe dipping myself.
One thing that concerns me slightly about this platform is that, due to the way loans are offered, you could be putting money into the same loan several times over, a fact which was confirmed when I contacted Wellesley. This would seem to defeat the principle of diversification which IMHO is a necessity in all investing but especially in P2P / P2B lending.
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bugs4me
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Post by bugs4me on Dec 29, 2013 18:55:38 GMT
Yes, I would second Batchoy’s comments having done a bit of toe dipping myself.
One thing that concerns me slightly about this platform is that, due to the way loans are offered, you could be putting money into the same loan several times over, a fact which was confirmed when I contacted Wellesley. This would seem to defeat the principle of diversification which IMHO is a necessity in all investing but especially in P2P / P2B lending.
Wellesley are forum members so I'm sure they're monitoring comments. If not then they should be as nipping misunderstandings in the bud is always the best way of clarifying matters. Otherwise drop them a note and please report back. Personally I'm looking at them but would prefer to hear how others get on first especially on the communication side - an area which many P2P's think is not important.
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mikes1531
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Post by mikes1531 on Dec 29, 2013 22:12:19 GMT
Personally I'm looking at them but would prefer to hear how others get on first especially on the communication side - an area which many P2P's think is not important. In reading the Ts&Cs, I was concerned by the lack of info regarding the Access Fee payable when loan parts are sold. I asked a question last week, and received a prompt response saying how the AF would work, and it struck me as similar to my understanding of how the RS fee works. If I've understood correctly, then the fee paid will reduce the investor's return to a level commensurate with the term they actually had invested for. (e.g. if exiting a 5-yr loan after three years, the fee should leave the investor with the return they would have had if they had invested in a 3-yr loan in the first place.) That explains what would happen for any loan parts sold after having been held for at least the minimum term available, which is 18 months, but I was left wondering what would happen in the case of loan parts sold after having been held for less than 18 months. So I've asked another question, and am awaiting a response to that. Hopefully I'll receive another prompt reply.
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Post by yorkshireman on Dec 29, 2013 22:22:57 GMT
One thing that concerns me slightly about this platform is that, due to the way loans are offered, you could be putting money into the same loan several times over, a fact which was confirmed when I contacted Wellesley. This would seem to defeat the principle of diversification which IMHO is a necessity in all investing but especially in P2P / P2B lending.
Wellesley are forum members so I'm sure they're monitoring comments. If not then they should be as nipping misunderstandings in the bud is always the best way of clarifying matters. Otherwise drop them a note and please report back. Personally I'm looking at them but would prefer to hear how others get on first especially on the communication side - an area which many P2P's think is not important. Perhaps I misunderstood but as a result of contacting Wellesley I was left with the impression that it could be possible for the 6 offerings, i.e. 18 months, 3 and 4 years interest paid monthly, 3 and 4 years interest paid on maturity and 5 years to all be parts of the same 5 year loan from Wellesley to the borrower. I’ll wait for a few days to see if they respond on this forum before contacting them again.
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Post by batchoy on Dec 29, 2013 22:41:12 GMT
Yes, I would second Batchoy’s comments having done a bit of toe dipping myself.
One thing that concerns me slightly about this platform is that, due to the way loans are offered, you could be putting money into the same loan several times over, a fact which was confirmed when I contacted Wellesley. This would seem to defeat the principle of diversification which IMHO is a necessity in all investing but especially in P2P / P2B lending.
The difference here is that your investments have the double security of assets and a protection fund. If Wellesley are doing their job properly and are holding real assets then need for diversification is not as great as with unsecured loans, so I don't see the fact that different investments might be assigned to the same asset backed loan as being a great issue.
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Post by yorkshireman on Dec 30, 2013 13:53:50 GMT
One thing that concerns me slightly about this platform is that, due to the way loans are offered, you could be putting money into the same loan several times over, a fact which was confirmed when I contacted Wellesley. This would seem to defeat the principle of diversification which IMHO is a necessity in all investing but especially in P2P / P2B lending.
The difference here is that your investments have the double security of assets and a protection fund. If Wellesley are doing their job properly and are holding real assets then need for diversification is not as great as with unsecured loans, so I don't see the fact that different investments might be assigned to the same asset backed loan as being a great issue. Yes I must agree with that although I’ll remain a toe dipper for a little longer!
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Post by wellesleyco on Dec 31, 2013 10:50:34 GMT
Good Morning all, I hope you have all had an enjoyable Christmas break. Thank you for your comments on this board. We are monitoring this forum so we can communicate with you all, answer any questions you may have; and listen to any ways you believe we could improve our service. We agree with bugs4me that communication is very important. We are keen to build relationships with our lenders and maintain completely transparent at all times. We encourage anybody who is thinking of lending through our platform to contact us directly our team is always keen to speak to anyone who has any questions and we would extend that service to anyone regardless of their situation. mikes1531. For early access under the minimum term of 18 months, I believe Andrew Turnbull has responded to your email. For others who are interested: The question regarding early access has sparked internal discussions and as a result we have decided that for the time being there shall be no charge for customers who wish for early access on the 18 month term. This should come into effect in the coming week. Furthermore, we will shortly be adding two new terms onto our platform that will be 6 months and 12 months. We have not yet decided on the rates of these terms but we aim to have these up and running by the end of January at the latest. Once we have launched these two new terms we will therefore introduce a charge that follows suit with the previously explained rationale (If an 18 month term was withdrawn after 12 months, the interest would drop the the 12 month rate). Having said this, we will honour the no fee for the duration of the 18 month term if you choose to sign up before we launch the new shorter terms. yorkshireman. You understood correctly that funds committed for any term (be it 18 month, 3 or 5 years) can be allocated to the same loan made by Wellesley & Co. The one detail I would like to clarify is that we do not lend money out for longer than a 1 year period. As we use allocation this enables us to then reallocate funds to other loans. The benefits of allocation mean that we are able to pay lenders interest as soon as they commit their funds and grant loans to creditworthy borrowers quicker than other platforms. batchoy “If Wellesley are doing their job properly and are holding real assets” – In the initial process of a loan application, the quality of the security is very important to us. All of our loans that we make are secured against property with an average Loan to Value of 50%. In the process of assessing a loan application our extremely experienced credit committee pays great attention to the asset upon which the loan is secured. As a result of this, we do not believe that diversification is as important in our model as it would be with unsecured loans on other platforms so what you mentioned is true. However we understand that many lenders do believe that it is very important and therefor we give the greatest amount of diversification with the loans that we have available. Unlike other secured P2P platforms. We always retain a portion of every loan so that our skin is in the game. This re-enforces that we would only lend your money to borrowers that we would lend to ourselves as our capital is at stake also. Furthermore in the hopeful unlikely event of a default our trustee prioritises the return of our customers money before we receive any of our capital back. We have taken a subordinated position behind our lenders capital. I thank you all for your participation in this forum and would like to encourage that it continues. We are in the lucky position where we have access to this and are keen to hear of any issues big or small, good or bad that you may have.
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