pom
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Post by pom on Oct 30, 2015 10:11:57 GMT
Morning Ed. I was going to put a bit of shrapnel on the Ferrari, but I haven't got the "invest now" button on my screen. Checked on the Lambo and it was OK. Is it a problem at my end or yours? Did you bid yesterday? If so try again now the initial 24hrs has passed... Edit - oops too slow :-D
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Post by MoneyThing on Oct 30, 2015 10:15:41 GMT
Morning,
Having just got back into the office this morning from my recent UK tour, I will be sending an email out later today to investors to give a quick update on Supercars & Property, however will just make a couple of notes here regarding supercars in advance.
I can see that the uptake on the supercars have not been as quick as other loans. I can appreciate that the combination of 70% LTV & those investors awaiting our report (currently being penned), is understandably causing some investors to hold back.
I am however confident that 70% LTV against these particular sought after cars is appropriate and I feel that the report will help investors to understand this segment of the supercar market better. As part of this education piece and to differentiate this market and help put these cars into context, the next supercar loans will likely be against three Ferrari FF's. The Ferrari FF is a standard current production model which at the moment are depreciating in value (although at a much lower rate than mainstream mass produced makes). As such, we will be lending against these cars at 50% LTV to reflect the fact that these models are depreciating. (See below).
What is interesting to note, that even on the standard mainstream supercars, on a 6 month loan term you are only looking at single digit depreciation on a new car and therefore we could still comfortably lend at 70% LTV (on nearly new cars). However, to differentiate the depreciating cars (current production models), from the appreciating cars (limited run/out of production/high demand vs supply), we will lend on these at 50% LTV & 70% LTV respectively.
Ferrari FF:
2.2% Depreciation in 1st year
17% Further Depreciation in 2nd year
16.9% Further Depreciation in 3rd year.
Total Depreciation in 3 years = 32%
BMW 320d:
40% Depreciation in 1st year
17.8% Further Depreciation in 2nd year
17.9% Further Depreciation in 3rd year.
Total Depreciation in 3 years = 60%
(source: What Car? Depreciation Calculator)
Kind regards,
Ed
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pom
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Post by pom on Oct 30, 2015 10:17:30 GMT
I think Ed is doing what he has done in the past, he is trying different things to find out what "sells", he tried aircraft and he tried some mortgages at the start and they took their time to loan out. His new trials are going to be with cars and property to see what moves. I bet he is looking at other partners to join the team. I think getting partners is generally good as long as they offer a nice steady stream of loans and MT gets a ring fenced loan supplier. This am 33% of the Lambo and 70% of the Ferrari are still available, these two are offering (as I understand it) a variable time period with a high LTV and assets that many of us don't understand. Let's see what happens over the weekend but I suspect these two will still have some loan left. Just to share, I consider the people who buy these cars to be mentally ill. The new props. opportunity appears to offer a varying rate of 12 or 9%, should be interesting. After all the present lenders have self-selected into people who want 12% for a 6 month loan. My own take on all this is the 500 lenders have a hard core of about 200 very active players, MT's processes so far have self-selected people who like to own a max of 1% of a loan up to about £500 or £1000 a pop. So, 200*£500=£100,000 is a nice size for a loan if you want it to flush out fast. I very much doubt MT need the loans to flush out fast so a loan of £200,000 would be a good maximum to offer lots of loan spread. If £200k makes up a tranche we could end up with a bunch of loans on the same property, if we do Ed, could you keep it simpler than say FS makes it please ?I've been having similar thoughts...I looked at amount invested/# investors the other day and it came out as an average of under 5k. Now that'll be heavily weighted by the time it takes to build up MT investments (taken me 5 months to get 14k in) but there's clearly a lot of investors out there with very little in so far for whom 1% of these larger loans will be looking massive.
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pom
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Post by pom on Oct 30, 2015 10:22:33 GMT
Ferrari FF:2.2% Depreciation in 1st year BMW 320d:40% Depreciation in 1st year Wow - and yikes!! Suddenly these supercar buyers seem almost sensible (specially when you see how many year old BMWs tend to be cluttering up the forecourts at BMW dealers...)
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star dust
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Post by star dust on Oct 30, 2015 10:39:48 GMT
It was alright for me. Did you perhaps invest yesterday and forget which side of 10 a.m you were? . Eureka. By jove you've cracked it! I really am losing the plot.Thanks for helping me realise it You're not the only one if it's any consolation, I sent some extra funds to add to my shrapnel, got the mental arithmetic wrong and had to send an extra £1 over separately to get a rounded amount!
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arbster
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Post by arbster on Oct 30, 2015 10:45:04 GMT
Just to share, I consider the people who buy these cars to be mentally ill. It's all about disposable income. Would you spend 5% of your annual disposable income on a frivolous toy, if it didn't present any risk to your standard of living, and if you could maintain or enhance your standing in your social circles? I know I probably would. Wow - and yikes!! Suddenly these supercar buyers seem almost sensible But let's not go that far...
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Monetus
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Post by Monetus on Oct 30, 2015 11:04:17 GMT
I have some (limited) experience of purchasing and owning supercars. I've also been called mentally ill by friends and family What Ed is suggesting is pretty much in line with my experiences and the high end supercar market cannot be compared to the traditional "normal" car market. In the past I have purchased a car, driven and enjoyed it for over 2 years, and sold it on to someone for a couple of grand less than I paid for it, which to me was well worth it! Supercars such as Lamborghini, Ferrari etc depreciate at a much lower rate than standard cars (which lose a much higher % as soon as you drive them off the forecourt). In fact many high-end supercars and limited edition versions will maintain/appreciate in value as they are extremely hard to get hold of and popular footballers/celebrities and suchlike. And so far, in my opinion at least, the cars that have been listed on MT have been this of this standard. I have invested in both supercar loans thus far and I am happy with the valuations and LTV that I've seen based on the information provided. My only question is - what is the purpose of these funds for the borrower? Presumably going out and buying more supercars and advertising them for sale? Are they using this cash as a rapid way to expand their overall stock and grow the business?
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Post by bracknellboy on Oct 30, 2015 11:06:21 GMT
The real fools in this business are those who buy "normal" cars fresh off the production line. (with apologies to anyone who always insists on buying brand new). Might as well park your bank account over a drain and open up the taps.
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pom
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Post by pom on Oct 30, 2015 11:24:53 GMT
Wow - and yikes!! Suddenly these supercar buyers seem almost sensible But let's not go that far... Note I said ALMOST The figures resonated more for me as to my surprise (not something I ever expected to do, but it made sense) I've just recently bought a bmw, but was pretty shocked when talking to the salesman to realise how many people clearly replace their bmw every year.... which will bring me on to bracknell boy's point... (is there a way to quote from multiple posts in a single one? If there is I don't know it so will be back in a sec.....)
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ramblin rose
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“Some people grumble that roses have thorns; I am grateful that thorns have roses.” — Alphonse Karr
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Post by ramblin rose on Oct 30, 2015 11:37:00 GMT
pom, the suspense is killing me
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TFTO
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Post by TFTO on Oct 30, 2015 11:41:00 GMT
Just to share, I consider the people who buy these cars to be mentally ill. It's all about disposable income. Would you spend 5% of your annual disposable income on a frivolous toy, if it didn't present any risk to your standard of living, and if you could maintain or enhance your standing in your social circles? I know I probably would. If I had the cash a Ferrari 488 GTB would pretty much be top of my spending list and I would not expect to lose much in a couple of years. Having said that 70% LTV against an F12 is a bit high, as low mileage examples can be found on Autotrader at a lot less than the asking price for the one on here.
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stevio
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Post by stevio on Oct 30, 2015 11:42:47 GMT
My only question is - what is the purpose of these funds for the borrower? Presumably going out and buying more supercars and advertising them for sale? Are they using this cash as a rapid way to expand their overall stock and grow the business? Would be nice to know! Also, assuming they are successful, why do they need to borrow the money? And if there is a reason why, why at such a high rate and not from a mainstream lender?
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pom
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Post by pom on Oct 30, 2015 11:43:21 GMT
The real fools in this business are those who buy "normal" cars fresh off the production line. (with apologies to anyone who always insists on buying brand new). Might as well park your bank account over a drain and open up the taps. I would agree with you for those that then replace them regularly....I remember wanting to run around screaming when a member of my extended family was going on about how he thought keeping a car beyond a year was a bad thing.... But personally, yeah I'm guilty of just having bought a brand new car for far more than I ever expected to spend on a car. But heck I just inherited a whole bunch of cash of which I've spent very little and I might as well have the exact spec I wanted and it was to replace an 11yr old car we've had from new (that was bought with a property sale windfall) that was just starting to have a few reliability issues, but 91% depreciation doesn't seem too bad in those circs! What makes me laugh is that the car it's replacing was hubby's - but as I rarely drive mine I can't justify replacing it, even tho it's nearly 10yrs old (was my company car, bought it at the end of its lease, and surprisingly still worth about 50% of what I paid for it). So I guess I reserve the right to do something "silly" for myself in a couple of years time, but with only 45k on the clock I "fear" it's going to last forever! So I like to think that not everyone that buys new cars are fools, but if anyone wants to point the finger at me I don't care Edit - sorry ramblin rose
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Post by mrclondon on Oct 30, 2015 11:51:29 GMT
(is there a way to quote from multiple posts in a single one? If there is I don't know it so will be back in a sec.....) Easiest way is go to the first post you want to quote, hit <quote> then change to <BBCode> view and copy the coded version of the quote. Hit back in the browser, hit <quote> on the second post, change to <BBCode> view, and paste in the coded quote from the first post either above or below the second coded quote. Make sure there are a few blank lines between them, then hit <Preview> to switch back to the WYSIWYG editor. Simples
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SteveT
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Post by SteveT on Oct 30, 2015 11:52:09 GMT
That's how I buy cars too. Buy exactly what I want, new, at the very best price available (so almost always via a broker) and then drive it for 6 / 7 / 8 years. 80% depreciation over 8 years is fine by me and a lot better than 35-40% over 1 !
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