Post by Rob on Sept 5, 2015 10:41:42 GMT
There are loans appearing on the SM where the YTM calculation is clearly wrong. If the sale price is at a premium, then the YTM has to be less than the borrower's interest rate. It appears that this happens when the time left is less than 1 month, so I am guessing that this is a divide-by-zero error which yields a result which is then limited to 1000%. See example below where the last payment was due on 3/9/2015:
17243-01 Estonia Secured Car Loan 4% 8.9% 1 (5) Current 1000.0% € 1.66 € 1.99 (20.0%)
Does this imply that the YTM is calculated on whole months and not days remaining? As interest is split pro-rata between buyer and seller if the loan is sold part way through the month, this is not very accurate when the loan is near the end of its life.
Mintos, please could you do something to stop these misleading YTM figures and calculate them daily if I am correct?
17243-01 Estonia Secured Car Loan 4% 8.9% 1 (5) Current 1000.0% € 1.66 € 1.99 (20.0%)
Does this imply that the YTM is calculated on whole months and not days remaining? As interest is split pro-rata between buyer and seller if the loan is sold part way through the month, this is not very accurate when the loan is near the end of its life.
Mintos, please could you do something to stop these misleading YTM figures and calculate them daily if I am correct?
