beechside
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Post by beechside on Sept 25, 2015 9:00:53 GMT
It seems that we are now in a position on SavingStream where loans > investments. I wonder what the impact might be? There are a few that I can think of and I'd appreciate the thoughts of others.
No downward pressure on interest rates
Bigger demand on underwriters (especially because of new structure)
Less liquidity in the secondary market
Easier for the big/institutional investors to play (no messing with small loans)
Easier for us to focus on quality loans
Greater predictability when setting prefunding levels
Extra costs for SS paying interest from day 1 when the loan takes longer to fund/draw down
I'm a relative newcomer and I wonder if this position has been reached before? What were the impacts then and might this all be seasonal?
Thanks all!
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kaya
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Post by kaya on Sept 25, 2015 9:07:27 GMT
Far to soon to say. Historically, large new loans can take some time to fill, and can help to open up the secondary market for previous loans. This will probably be the same, though obviously if the deal flow were to continually increase then a saturation point will be reached eventually. Probably not yet though.
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SteveT
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Post by SteveT on Sept 25, 2015 9:28:07 GMT
SS moves between feast and famine on a fairly regular basis, depending on the size and frequency of new loans and what has been paying back. Give it a week or two without a new loan launch and we'll be back to "no green" again.
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Post by jackpease on Sept 25, 2015 9:30:05 GMT
My guess is that we've seen a splurge of loans which I can't see carrying on indefinitely - and at some point loans will start being repaid in quantity.
Bit of a shock to those that have only been used to instant liquidity on SS!
Jack P
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pom
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Post by pom on Sept 25, 2015 9:32:45 GMT
Agree that it's too soon to say, especially as we've just had a glut of very big loans after a dry period, interest payments are due next week and for now the pipeline appears to be reducing. But I think the moral if you're at all concerned is don't buy more than you want to hold in a loan, particularly if it's a large one.
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SteveT
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Post by SteveT on Sept 25, 2015 9:34:03 GMT
I think that's why the pre-funded total on yesterday's new loans was well down on the previous few; investors are realising that, if they request more of a large value loan than they actually want to hold medium term, they may be stuck with it for quite a while and so forced to sell down other loans (that they'd prefer to keep) to cover their BACS deficit.
Life on SS has certainly got less frenzied (at loan launches) but more strategic in recent weeks!
[Pom beat me to it!]
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star dust
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Post by star dust on Sept 25, 2015 10:28:30 GMT
Talking of supply, one of the pipeline loans (office block in Somerset?) has vanished, so only the two Hackney ones left now! It seems to me the rate of increase in registered investors also seems to have slowed recently, but I may have been imagining it.
Agree with others this needs to be viewed in the longer term and isn't either that exceptional or necessarily a reflection of things to come.
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ilmoro
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'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 Sept 25, 2015 10:47:22 GMT
Talking of supply, one of the pipeline loans (office block in Somerset?) has vanished, so only the two Hackney ones left now! It seems to me the rate of increase in registered investors also seems to have slowed recently, but I may have been imagining it. Agree with others this needs to be viewed in the longer term and isn't either that exceptional or necessarily a reflection of things to come. Valuation never appeared as scheduled so maybe came in light or raised issues Could probably do with a pause - clear the oversupply, sort overdue/imminent loans, clear break between Trust- non Trust loans, allow analysis by SS of recent changes impact, plus new platform pending. Burp! 
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Post by meledor on Sept 25, 2015 11:06:56 GMT
Having rapidly increased my investment over this month on the basis that the new structure would be implemented quickly and for existing loans, I've put further increases in my overall total on hold for the time being while we wait for loans to actually appear/be transferred under the new T&Cs. It could be that others are doing the same. I don't think there's any lasting impact with the current situation - having grown like topsy if necessary Saving Stream could just slow down for a while to let lending catch up.
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Liz
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Post by Liz on Sept 25, 2015 17:52:07 GMT
It's good to have a few loans not fully subscribed, otherwise new lenders will just walk away when they can't get any loans.
All it will take a couple of redemptions and the lean pipeline to put us back to square 1.
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registerme
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Post by registerme on Sept 25, 2015 18:11:17 GMT
Agreed, my view of timelines on SS is longer than it is on any other platform. I think there will be periods of feast and fallow as and when new loan demand arises and / or new lender funds appear. We already see a cycle with monthly interest payments that alone add 12% ~1% of the outstanding loan book into the pot (minus any withdrawals). I suspect it's nigh on impossible for SS to manage this perfectly, which means that there will be times we we lenders have idle funds, and times when SS are paying underwriters for longer than they would otherwise. EDIT: Thanks to mrclondon and duncandive for pointing out that I was being stupid  . |
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Post by mrclondon on Sept 25, 2015 20:00:37 GMT
Agreed, my view of timelines on SS is longer than it is on any other platform. I think there will be periods of feast and fallow as and when new loan demand arises and / or new lender funds appear. We already see a cycle with monthly interest payments that alone add 12% of the outstanding loan book into the pot (minus any withdrawals). I suspect it's nigh on impossible for SS to manage this perfectly, which means that there will be times we we lenders have idle funds, and times when SS are paying underwriters for longer than they would otherwise. Now if only p2p loans did yield 12% a month I could buy the superyacht that caught my eye in a Mediterranean harbour earlier today  Alas its only 1% a month. Oh well, perhaps a pedalo is more my style !
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Post by duncandive on Sept 25, 2015 20:10:38 GMT
Agreed, my view of timelines on SS is longer than it is on any other platform. I think there will be periods of feast and fallow as and when new loan demand arises and / or new lender funds appear. We already see a cycle with monthly interest payments that alone add 12% of the outstanding loan book into the pot (minus any withdrawals). I suspect it's nigh on impossible for SS to manage this perfectly, which means that there will be times we we lenders have idle funds, and times when SS are paying underwriters for longer than they would otherwise. Not sure if I have read your comment corectly but my understanding is that it is 1% rather than 12% that is added to the outstanding loan book each month. Edit; crossed with mrclondon
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registerme
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Post by registerme on Sept 25, 2015 20:11:09 GMT
Agreed, my view of timelines on SS is longer than it is on any other platform. I think there will be periods of feast and fallow as and when new loan demand arises and / or new lender funds appear. We already see a cycle with monthly interest payments that alone add 12% of the outstanding loan book into the pot (minus any withdrawals). I suspect it's nigh on impossible for SS to manage this perfectly, which means that there will be times we we lenders have idle funds, and times when SS are paying underwriters for longer than they would otherwise. Now if only p2p loans did yield 12% a month I could buy the superyacht that caught my eye in a Mediterranean harbour earlier today Alas its only 1% a month. Oh well, perhaps a pedalo is more my style ! Ahh, errrm, yes, my maths, or more to the point my writing skills, failed there magnificently. Back to your yacht sir!
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Liz
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Post by Liz on Sept 25, 2015 20:10:40 GMT
And if it did pay 12% a month, I would run a mile.
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