ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Mar 5, 2015 17:49:41 GMT
batchoy - the lender terms and conditions are available as soon as you register. Merely signing up does not imply that you agree to the terms and conditions - you need to agree to them separately. I can assure you that our legal documents have been prepared with the assistance of one of the premier law firms in the country when it comes to the peer-to-peer lending sector. bugs4me - Thanks for the feedback. You should be able to access the lender terms and conditions through a link on the bottom right-hand corner of your lender account page. On the returns and LTV, there are a number of reasons why we think our loans offer better value than our competition. As already mentioned above, our fees only start to accrue after the lender's principal is paid back in full. Therefore, we make no money on a given loan if the lenders don't make money. Also, loans made against gold are protected by a Gold Trust within which we purchase protection against a fall in gold prices. Further, we have just launched our Provision Trust into which 1% of the notional of each loan we make is paid in. This Trust is available to protect against principal losses on our non-Gold loans (Gold loans being hedged against both principal and interest loss via the Gold Trust). We encourage our lenders to maintain diversified portfolios but the Provision Trust helps protect even those lenders who may have more concentrated holdings. When we take these protections into account, we feel that our LTV/price point offers value. We can increase the interest rate and reduce the protections but we feel that this is not prudent and penalises small lenders with undiversified portfolios. Thanks. Ive now spotted the onsite link to T&cs. Wonder who you consider to be your competition? The 2 popular sites dealing with asset secured loans on non-property items dont charge fees & offer rates that are a couple of percent points above your current offerings on an annual equivalent. While neither offer a provision fund/gold trust, at least one of them has the protection of the assets being automatically redeemed by their partner in t?he event of a default thereby offering 100% protection to lenders. Im still evaluating your offer but early impressions havent given me any reason to invest compared to existing providers Im afraid Good luck anyway
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Post by ashwinp on Mar 5, 2015 18:43:00 GMT
il moro - I should point out that we do not charge any fees to lenders. The interest rates paid out on all loans listed on our site is the interest rate that you receive.
You mentioned that our direct competitors such as FundingSecure offer a couple of percentage points more in interest. We put 1% of each loan principal into the Provision Trust which, given our average loan life of 4-5 months, translates into a 2.4-3% difference in the annualised return. Combined with the fact that loan principal is senior to our fees, we think this makes us more than competitive compared to not just our direct competitors but to the larger short-term loans/bridge-lending space.
Regarding the competitive offer from MoneyThing where the partner commits to redeeming the pledge upon default, that is an excellent idea and another way of providing some level of diversification. Obviously we originate the loans through our platform so this model is not applicable to us. I should point out that there is nothing such as 100% protection. The guarantee exposes you to the credit risk of the partner and in a scenario where the prices of a large proportion of assets (such as gold) falls, the credit of the guarantor deteriorates as much as the price of the assets.
I absolutely understand that you may prefer a higher-risk, higher-return product without the various protections we have put in place. We simply feel that our current product is the best option for smaller investors and investors who may prefer to follow a more passive approach (such as many of our early lenders who use our Auto-Lend tool). I do hope you reconsider. Happy to answer any other queries.
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 10,840
Likes: 11,068
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Post by ilmoro on Mar 6, 2015 0:38:12 GMT
il moro - I should point o that we do not charge any fees to lenders. The interest rates paid out on all loans listed on our site is the interest rate that you receive. You mentioned that our direct competitors such as FundingSecure offer a couple of percentage points more in interest. We put 1% of each loan principal into the Provision Trust which, given our average loan life of 4-5 months, translates into a 2.4-3% difference in the annualised return. Combined with the fact that loan principal is senior to our fees, we think this makes us more than competitive compared to not just our direct competitors but to the larger short-term loans/bridge-lending space. Regarding the competitive offer from MoneyThing where the partner commits to redeeming the pledge upon default, that is an excellent idea and another way of providing some level of diversification. Obviously we originate the loans through our platform so this model is not applicable to us. I should point out that there is nothing such as 100% protection. The guarantee exposes you to the credit risk of the partner and in a scenario where the prices of a large proportion of assets (such as gold) falls, the credit of the guarantor deteriorates as much as the price of the assets. I absolutely understand that you may prefer a higher-risk, higher-return product without the various protections we have put in place. We simply feel that our current product is the best option for smaller investors and investors who may prefer to follow a more passive approach (such as many of our early lenders who use our Auto-Lend tool). I do hope you reconsider. Happy to answer any other queries. Ok, a very interesting reply which gives food for thought.The fees statements are quite confusing, I think you need to make a clear statement that lenders do not pay fees,in fact, in general, I think you could be a lot clearer in the way you communicate on your site eg. providing an annual equivalent for your rates so it is easier to compare against other platforms. I will take a more detailed look as my first impression appears to have been based on a misinterpretation of elements of your offer
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Post by ashwinp on Mar 6, 2015 9:32:46 GMT
il moro - Thanks for the feedback. Your point is valid and well taken. We can clearly do a lot better in terms of communicating our offer to lenders and we will try to do so in the coming weeks. As you may have noticed, much of our website is geared towards acquiring borrowers and we still need to do a lot better to make it easy for both borrowers and lenders to find the information they need. Some relevant information regarding lenders can be found on this page unbolted.com/uk/how-lending-works/. |
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Post by batchoy on Mar 6, 2015 10:43:41 GMT
il moro - I should point o that we do not charge any fees to lenders. The interest rates paid out on all loans listed on our site is the interest rate that you receive. You mentioned that our direct competitors such as FundingSecure offer a couple of percentage points more in interest. We put 1% of each loan principal into the Provision Trust which, given our average loan life of 4-5 months, translates into a 2.4-3% difference in the annualised return. Combined with the fact that loan principal is senior to our fees, we think this makes us more than competitive compared to not just our direct competitors but to the larger short-term loans/bridge-lending space. Regarding the competitive offer from MoneyThing where the partner commits to redeeming the pledge upon default, that is an excellent idea and another way of providing some level of diversification. Obviously we originate the loans through our platform so this model is not applicable to us. I should point out that there is nothing such as 100% protection. The guarantee exposes you to the credit risk of the partner and in a scenario where the prices of a large proportion of assets (such as gold) falls, the credit of the guarantor deteriorates as much as the price of the assets. I absolutely understand that you may prefer a higher-risk, higher-return product without the various protections we have put in place. We simply feel that our current product is the best option for smaller investors and investors who may prefer to follow a more passive approach (such as many of our early lenders who use our Auto-Lend tool). I do hope you reconsider. Happy to answer any other queries. Ok, a very interesting reply which gives food for thought.The fees statements are quite confusing, I think you need to make a clear statement that lenders do not pay fees,in fact, in general, I think you could be a lot clearer in the way you communicate on your site eg. providing an annual equivalent for your rates so it is easier to compare against other platforms. I will take a more detailed look as my first impression appears to have been based on a misinterpretation of elements of your offer Having acquired a copy of the Ts&Cs from a third party that has registered, since it isn't available until you have registered, my understanding from a first read through last night is that there is a 0.5% fee on secondary market sales or if there is not one imposed now Unbolted reserve the right to charge one. Which strikes me as somewhat underhand as it mean that they can impose a fee at any point in the future without necessarily informing anyone on something that is detrimental to the lender because they have already included it in their Ts&Cs. Additionally the Ts&Cs do not appear to describe how Accrued Interest is treated for SM sales and purchases.
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 10,840
Likes: 11,068
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Post by ilmoro on Mar 6, 2015 10:56:50 GMT
ashwinp Need to look at your site settings. You seem to be able to be logged in permanently. It doesnt time out or log u out when you close your browser!!
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 10,840
Likes: 11,068
|
Post by ilmoro on Mar 6, 2015 14:38:39 GMT
OK, Ive had a bit of a poke around and my general impression is the whole site feels like it has been launched before it was ready.
I accept that youve said that it is geared towards attracting borrowers but the complete absence of any real information for lenders seems like a massive flaw, particularly as you imply in your borrowers T&Cs that offers to lend will be dependent on the availability of adequate lending funds from its registered Lenders or by inviting lenders to advance funds against the loan
So bits that have occurred to me
-How long does it take for funds to be credited to lending accounts (a reoccurring issue on at least one platform)? You make reference to debit card payments in T&Cs is this something that is forthcoming?
-What is the minimum amount lenders can lend on a loan?
-How often is interest paid?
-How do you withdraw cash & how long does it take? (another reoccurring question) Its in the T&Cs but not obvious on the site
-Whats the interest rate lenders get? Ive seen reference to 10.5% or 8% on gold but nowhere is that stated on any of the loan proposals. The monthly rate of .85% if stated but that would only give a rate of 10.2% or is the interest compounded and paid at the end?
-LTVs - these are just for the loan itself I assume, so in the event of a default, outstanding interest (plus that accummalating whilst disposal occurs) would push the price needed at disposal higher than this I would assume. For example current LTV for full recovery incl interest & fees on Loan 2DFDC1CFE is 64% not 60.88% stated (remove fees & its 60.96%) I notice that interest on non-gold loans ranks pari passu with Unbolted's fees
-It would be nice if the loan info included a valuation report or at least some photos/ detailed breakdown of the individual items & their values so lenders can carry out their own research (Again an issue reoccurring elsewhere)
-Fees - as Ive said statements on this are unclear eg. From the itemised loan pages *Set-up fees added to the loan are refunded to the lender if loan principal is not recovered on default. If your refunding something to someone that implies they have paid it in the first place
-How does the selling loan parts work? No sign of a secondary market referred to in T&Cs. Is that forthcoming and whats the timescale? How will accumulated interest be handled between seller & buyer?
-Reference to prevailing rates in regard to Autolend and maximum LTV. Found the former on bottom of the home page but shouldnt this feature on the Autolend page. Cant find the latter!
-How does autolend work? Can I set restrictions on what kind of loans it lends on/ risk profiles?
-Cant find anything on what would happen in the event of Unbolted failing. What provisions are there for the orderly management of the loan book?
Based on your previous comments I probably the kind of lender your looking to attract (albeit an awkward one) but there seems to be a lot of unanswered questions at the moment. That said I am considering dipping a small toe to see how it works. Your rates aernt the highest but then I realised I lend on other platforms that are much lower but compensate with added security
Thanks
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Post by ashwinp on Mar 6, 2015 16:20:52 GMT
batchoy - we do not permit secondary market sales as of now so the fee on secondary sales is not applicable as we speak.
There are no fees on purchasing loans listed on the platform. The loans are always bought at the (initial loan amount + the accrued interest) from our bridge lenders. So if a loan is listed today and you purchase it tomorrow, the price will increase slightly.
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Post by batchoy on Mar 6, 2015 16:27:05 GMT
batchoy - we do not permit secondary market sales as of now so the fee on secondary sales is not applicable as we speak. There are no fees on purchasing loans listed on the platform. The loans are always bought at the (initial loan amount + the accrued interest) from our bridge lenders. So if a loan is listed today and you purchase it tomorrow, the price will increase slightly. Then your Ts&Cs a load of meaningless drivel which you have already breached since you cannot fulfil your half of the contract that is formed between you and the lender when the lender agrees to the Ts&Cs. No wonder you don't want anybody to read them before they have registered with your site.
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Post by ashwinp on Mar 6, 2015 16:47:54 GMT
il moro - thanks for the feedback on logging out users. We will take a look at it.
On your other queries -
-How long does it take for funds to be credited to lending accounts (a reoccurring issue on at least one platform)?
Ans: We have an automated process for end-of-day crediting but at present, we often credit your account much quicker i.e. intra-day.
You make reference to debit card payments in T&Cs is this something that is forthcoming?
Ans: We are working on allowing debit card payments but are unlikely to be able to offer it within the next few months.
-What is the minimum amount lenders can lend on a loan?
Ans: Currently there is no minimum amount.
-How often is interest paid?
Ans: The interest and principal are repaid to the lenders as and when the borrowers repay the loans. The maximum maturity of the loans is six months.
-How do you withdraw cash & how long does it take? (another reoccurring question) Its in the T&Cs but not obvious on the site
Ans: You need to submit a withdrawal request which can be submitted on the lender account page. The request is processed by the end of the business day.
-Whats the interest rate lenders get? Ive seen reference to 10.5% or 8% on gold but nowhere is that stated on any of the loan proposals. The monthly rate of .85% if stated but that would only give a rate of 10.2% or is the interest compounded and paid at the end?
Ans: It is 0.85% per month which on a six month loan translates into an annualised compounded return of 10.46%. If the loan is repaid earlier, the annualised return increases slightly depending on when it is repaid.
-LTVs - these are just for the loan itself I assume, so in the event of a default, outstanding interest (plus that accummalating whilst disposal occurs) would push the price needed at disposal higher than this I would assume. For example current LTV for full recovery incl interest & fees on Loan 2DFDC1CFE is 64% not 60.88% stated (remove fees & its 60.96%) I notice that interest on non-gold loans ranks pari passu with Unbolted's fees
Ans: I'm not sure I understand your numbers. The LTV is simply the 'Loan balance outstanding to lenders (current price of loan)' less the initial fees divided by the valuation which in this case is 60.88% today.
-It would be nice if the loan info included a valuation report or at least some photos/ detailed breakdown of the individual items & their values so lenders can carry out their own research (Again an issue reoccurring elsewhere)
Ans: Thanks. We will look into this. We are restricted by the need to preserve the privacy of our borrowers. I can assure you that the assets are valued by external experts at an auction estimate.
-Fees - as I've said statements on this are unclear eg. From the itemised loan pages *Set-up fees added to the loan are refunded to the lender if loan principal is not recovered on default. If your refunding something to someone that implies they have paid it in the first place
Ans: Thanks for the feedback. The fees are fees payable by the borrower that are added onto the loan. Upon default, these fees are junior to the lender principal.
-How does the selling loan parts work? No sign of a secondary market referred to in T&Cs. Is that forthcoming and whats the timescale? How will accumulated interest be handled between seller & buyer?
Ans: We will explore setting up a secondary market once we have some critical mass. As you mention, we also need to formulate a way in which accumulated interest is treated in a manner that is fair to both the buyer and seller.
-Reference to prevailing rates in regard to Autolend and maximum LTV. Found the former on bottom of the home page but shouldnt this feature on the Autolend page. Cant find the latter!
-How does autolend work? Can I set restrictions on what kind of loans it lends on/ risk profiles?
Ans: Currently this is not possible. We will look to add more options to the autolend options as we see more flow.
-Cant find anything on what would happen in the event of Unbolted failing. What provisions are there for the orderly management of the loan book?
Ans: We are FCA authorised and hold sufficient capital as prescribed by them in reserve to deal with the contingency.
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Post by ashwinp on Mar 6, 2015 16:51:20 GMT
batchoy - to quote from our terms and conditions, "If you wish to exit your Loan (or part of it) before the end of the Loan term, Unbolted may allow you to offer to transfer your Loan to other Lenders on the platform as a Secondary Loan".
We certainly do not commit to offering a secondary market on our loans although we will endeavour to offer one soon.
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james
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Post by james on Mar 8, 2015 10:38:16 GMT
It appears that you are breaching the FCA's misleading financial promotions rules on one of your bowwowing pages, The lowest interest rates with no hidden charges: "Pay interest and fees only at the end We do not deduct any interest or fees upfront." "Representative example Total credit: £2500. Set-up fees: £75. Loan Principal: £2575. Loan term: 6 months. Annual Interest rate: 30% (fixed). Total interest for 6 months: £461.25. Total amount repayable in one installment: £2961.25" "One-time standard set-up fees of 3.00% added to the loan." There appears to be a £75 fee at the start, not at the end. The fee appears to be deducted from the loan amount at the start. So the claims about end and no deduction up front appear to be false. Also note that this mentions an up-front fee: "Do I have to pay anything for the valuation? No, the valuation is offered completely free to you. There are no charges to pay if you do not proceed with a loan. If you proceed with the loan, there is an set-up fee payable upfront which covers all valuation costs." You might also want to consider switching from the US spelling of installment to the UK version instalment. |
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james
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Post by james on Mar 8, 2015 10:47:50 GMT
The borrower FAQ contains this information: "What happens if I cancel within the first 14 days? If you cancel within the first 14 days, you pay the daily interest calculated on your loan for the days you have borrowed for. You also pay the set-up fees that covers the costs incurred for valuation and getting your assets to us. We not charge any other fees. In practice, this is the same as repaying your loan early at any time, as we calculate interest daily and do not charge any additional fees." Please explain: 1. whether Unbolted is acting as a credit broker between borrowers and PSP lenders. 2. how this charging structure is consistent with the requirement to offer a 14 day cooling off period for borrowers and if a broker, how it complies with the maximum permitted retained broker charge. 3. how Unbolted is complying with the credit broking rules that took effect on 2 January 2015, notably the requirement for brokers to disclose that they are brokers before any fees can be deducted. |
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james
Posts: 2,205
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Post by james on Mar 8, 2015 10:50:52 GMT
Please describe your money laundering identification check process for borrowers and for lenders.
Do you always have face to face contact with borrowers? If not, how do you comply with the "enhanced" identity check requirements normally applicable to businesses without such contact that are considered high risk?
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james
Posts: 2,205
Likes: 955
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Post by james on Mar 8, 2015 11:27:59 GMT
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