duck
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Post by duck on Feb 1, 2014 6:26:13 GMT
Alas, as a lender but not as a RateSetter employee, it doesn't look like we''ll get a 6.0% peak anytime soon. Perhaps 5.9% but there's £300k plus waiting below and lenders usually drop more money in when the markets rise.. Time for a bit of polish on the crystal ball westonkev?
All in all a very satisfying week with RS. My timing to transfer a decent wedge of cash proved spot on and lending speed was impressive. From a personal point of view I also saw my total investment add a significant '0' at the end.
Keep up the good work!
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oldgrumpy
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Post by oldgrumpy on Feb 7, 2014 23:49:39 GMT
I see that RS have returned to the policy of pre-filling in the lending rate box when you make an offer. They used to do this calling it market rate, then left it blank so we could choose, but now have returned to pre-entering a rate. This seems always to be 0.1% below the existing offer, pushing rates for lenders down. No doubt this is to put you at the front of the queue.
For instance, at this moment, on 5 year, there is £252K on offer at 5.8% £12.8K at 5.7% nothing at 5.6% £2.1K at 5.5% £65 at 5.4%
Now a sensible rate to put your cash for a fairly quick lend is 5.7% (you can always lower it later if some Zopa expat slams in £20K undercutting you), but Ratesetter are suggesting try 5.3%. Why? OK, Grumpy's greedy; he can wait a couple of loans to get 5.7% rather than 5.3% (which, no doubt would trigger RS to lower the suggested rate to 5.2%!!!)
Yes, I know we can change our offer rate to exactly what we want, but if RS is doing this for all the people using automatic reinvesting of repayment (and I believe they are) , a lot of people are getting a lower rate than they need to.
In the above example I believe 5.7% is the "market rate" not 5.3%. All those below 5.7 are "outliers" which may well have been system set (auto relend at market rate) rather than manually set by a lender.
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Post by westonkevRS on Feb 8, 2014 7:52:28 GMT
Auto-investment hasn't changed at all, same as it's always been at the higher market matched rate. The only change is to pre-populate the suggestion for manual lending, which most lenders choose their rate as it's always been.
But I like a conspiracy theory as much as the next man!
Kevin.
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agent69
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Post by agent69 on Feb 8, 2014 10:37:34 GMT
I'm relatively new to Ratesetter and I do find this irritating. What annoys me most are the words that say "at my selected rate of .....".
Hello Ratesetter! it's not my selected rate it's yours. The only reason I can see for setting the rate to a figure which is lower than anyone else is bidding at is to try to drive rates down
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Post by bracknellboy on Feb 8, 2014 11:11:53 GMT
I'm relatively new to Ratesetter and I do find this irritating. What annoys me most are the words that say "at my selected rate of .....". Hello Ratesetter! it's not my selected rate it's yours. The only reason I can see for setting the rate to a figure which is lower than anyone else is bidding at is to try to drive rates down Understandable sentiments. As someone who has only recently started using Ratesetter, and is using it only 'at the fringes', I have to say I do tend to select a rate to get in front of the Q, unless the Q @ best rate is small. Having initially stuck money in at higher rate and had it sit around forever (and hence decided to withdraw and then resubmit it) I wouldn't want money to be sitting there for ages, and potentially indefinitely. That said, if I was sticking in at 5 year, I might be more inclined to have it sit there for a while.
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oldgrumpy
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Post by oldgrumpy on Feb 8, 2014 11:23:25 GMT
What I do like about RS is how easy it is to change a rate down a notch or so if my (greedy) anticipation of what will match within 48 hours turns out to be optimistic.
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agent69
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Post by agent69 on Feb 8, 2014 12:58:54 GMT
On the subject of taking a lower rate now or holding out for something higher, can somebody help me with the maths to work out the break even point?
For example: I have £100 in my Ratesetter account (not earning anything) and I have the option of lending on the 5 year market at 5.6% today or waiting to get 5.7% at some time in the future. How long can I afford to wait before the extra 0.1% interest is offset by the fact the i'm getting 0% interest while I am waiting.
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angrysaveruk
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Post by angrysaveruk on Feb 8, 2014 16:55:35 GMT
On the subject of taking a lower rate now or holding out for something higher, can somebody help me with the maths to work out the break even point? For example: I have £100 in my Ratesetter account (not earning anything) and I have the option of lending on the 5 year market at 5.6% today or waiting to get 5.7% at some time in the future. How long can I afford to wait before the extra 0.1% interest is offset by the fact the i'm getting 0% interest while I am waiting. These are some simple approximate calculations: 1) How much more interested do you earn on an extra 0.1%. On a 5 year loan. The average time that your money is locked up is 2.5 years (since it is paid back over time in installments) so on a loan of 10,000: 10000 * 2.5 * 0.001 = £25 (extra income) 2) How much do you lose each day by withholding a loan of 10,000 when the market rate is 5.6%: 10000 * 5.6 / 365 = £1.47 (lost income) The approximate break even point is 25 / 1.47 = 17 Days. So obviously waiting a few days is worth while but you have to remember there is also the risk that more and more money will come in and rates will drop permanently so you wont even be able to get the current rate. Rates are probably on the way down and once the FCA start regulation and more savers/investors start putting in money I wouldnt be atall surprised in the 5 year deposit wasnt 4.8% on the 5 year by April/May. Even in the short time I have been on Rate Setter the 3 year rate has dropped from 4.6% to 4.1% and it doesnt look like going back up any time soon. Put some in at 30/40 thousand above to the current rate and some in at a higher rater (200k above current) which you can cancel if too much new money comes onto the market
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oldgrumpy
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Post by oldgrumpy on Feb 8, 2014 17:36:57 GMT
"Rates are probably on the way down and once the FCA start regulation and more savers/investors start putting in money I wouldnt be atall surprised in the 5 year deposit wasnt 4.8% on the 5 year by April/May."
5 year rates were down at 4.8% (possibly even lower for a few loans) in June 2013.
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spiral
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Post by spiral on Feb 9, 2014 11:04:23 GMT
The approximate break even point is 25 / 1.47 = 17 Days. This matches what I calculated a few months back. On the whole, I have found that for the 5 yr market, 5.7 is always achievable (on the last few months) and more often than not, 5.8 is also viable because remember, its 17 days per 0.1 so if the current market rate is 5.4%, you have 51 or 68 days for the rate to be matched. Another point worth noting is the longer you have to wait, the greater the likelihood that you are at the front of the queue for your desired rate as many people get frustrated and drop their rate thus moving you closer to the front of your chosen rate.
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Post by p2plender on Feb 24, 2014 15:41:50 GMT
Any idea what RS lend out on an average day in the 5 year market? Just curious.
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Post by westonkevRS on Feb 25, 2014 6:39:41 GMT
Are you a member?
In the members area (i.e. you are logged in) under RateSetter Info and Volume you can see the matched amount last 24hrs, 7 days, month and year. This is also broken down by market.
Kevin.
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Post by p2plender on Feb 25, 2014 8:28:25 GMT
thanks kev I'll take a look.
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