oldgrumpy
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Post by oldgrumpy on Mar 1, 2016 9:16:14 GMT
Ah! So what will happen to sister Frumpy, who gets caught by a downspike in the rate, and invests at 1.3%, (as may well happen!), then wants to sell a week later, on a day like today when the going rate is 4%? What will be the calculation then?
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alender
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Post by alender on Mar 1, 2016 9:56:44 GMT
Does anyone know which monthly contracts is chosen if you do a part withdrawal and have multiple contracts? As an example if I have £1000 at 3% maturing 10/3/2016, £1000 at 4% maturing 15/3/2016 and £1000 at 3% maturing 20/3/2016. If I ask for £1000 will it come from: 1. The loan with the highest rate. 2. The loan with the earliest maturity date. 3. The loan with the latest maturity date. 4. Spit between all 3 loans. This scenario assumes there are lenders offers available to cover all the loans. Perhaps Kevin can help it he can spare the time. Actually: 5. The loan with the most recent (newest) contract dates. This was coded on the basis that these latest loans would be closest to the current market rate this making any fees and impact of sell-out minimal. I'm sure others have what they consider better ways to have coded this, but the above is transparent and fair and easiest to explain in terms of its logic. If it isn't already there, I'll ask for it to be added to the FAQs. Kevin. Thanks for the info, very useful, seems like a reasonable choice to make and it is good to know which of my loans will be used if I chose to do a part withdraw. Although it may be worth having the option to use the highest rate loan if there are no funds available to cover the lower rate ones, I assume you cannot sell out unless/until lender funds are available to cover the sell out. If the techie guys have time perhaps the loan/s used could be added to the info presented when the calculate button is pressed and would help to explain the amount of interest accrued.
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alender
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Post by alender on Mar 1, 2016 9:59:49 GMT
Ah! So what will happen to sister Frumpy, who gets caught by a downspike in the rate, and invests at 1.3%, (as may well happen!), then wants to sell a week later, on a day like today when the going rate is 4%? What will be the calculation then? When I spoke to RS about this they said there need to be lender funds available to sell out so I guess it will be put on hold until this occurs.
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spiral
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Post by spiral on Mar 1, 2016 10:49:52 GMT
Ah! So what will happen to sister Frumpy, who gets caught by a downspike in the rate, and invests at 1.3%, (as may well happen!), then wants to sell a week later, on a day like today when the going rate is 4%? What will be the calculation then? When I spoke to RS about this they said there need to be lender funds available to sell out so I guess it will be put on hold until this occurs. But the key words missing from your statement is "lender funds available at what rate". In OG's example there are funds, just at a much higher rate than the original contract, so do they match, don't they match, or do they match with penalty?
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alender
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Post by alender on Mar 1, 2016 11:06:08 GMT
When I spoke to RS about this they said there need to be lender funds available to sell out so I guess it will be put on hold until this occurs. But the key words missing from your statement is "lender funds available at what rate". In OG's example there are funds, just at a much higher rate than the original contract, so do they match, don't they match, or do they match with penalty? Sorry, RS said there needed to be funds available at the rate of the loan you are selling out. Not sure what will happen if there are no funds available at your loan rate but funds are available at a lower rate, I guess it will pass the loan onto them but at a lower rate. However if you have multiple loans at different rates and you do a partial sell off it looks like the latest loan taken out will be chosen but if this is a lower rate than lenders offers I guess you get put on hold even if you have other loans with higher rates which could be sold off. If in this scenario you do full sell out it would be interesting to know what happens, do you get funds for the higher rate contracts that can be placed with new lenders and the rest put on hold or is it all put on hold until all of the funds are available. This sell off option is more complex that it first seems. There seems to be no way of finding out what will happen until you confirm the sell out as the calculate button tells you what the capital an interest are but not which loan it is coming from and if there are funds to cover the selloff, also if there are no funds available can you cancel he selloff.
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oldgrumpy
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Post by oldgrumpy on Mar 1, 2016 11:19:16 GMT
Nail on head time! RS needs to add a stage such as:
1. Buyers' funds are available at this rate - do you wish to proceed now? 2. Buyers' funds are not available at this rate - do you wish to have your request pending until funds are available? 3. Buyers' funds are not available at this rate - do you wish to withdraw your request?
Has anyone encountered this scenario yet? It won't just affect the extreme situation I invented, but anyone who has funds invested at a lower rate than is currently available. Is my 3.7% money from yesterday stuck because the best rate lenders are offering at this moment is 4%? (I'm not bothered, but it would help to know).
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spiral
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Post by spiral on Mar 1, 2016 11:24:03 GMT
Sorry, RS said there needed to be funds available at the rate of the loan you are selling out. Not sure what will happen if there are no funds available at your loan rate but funds are available at a lower rate, I guess it will pass the loan onto them but at a lower rate. No need to apologise, when I said "what was missing", I assumed RS hadn't made that clear. What they have stated is even more concerning than applying a fee because taking OG's example, if lent at 1.3% and you try to sell out when the current market is 4.0, the loan will almost certainly be repaid before that rate is ever reached again within the term. Makes a mockery of the statement made on the "access your money easily" page Average Sell Out statistics: 10 minutes to match replacement investor
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Post by westonkevRS on Mar 1, 2016 11:40:08 GMT
arh, alender " If the techie guys have time". Alas they are fully booked ensuring we meet all the requirements for FCA Authorisation and then for the IF ISA. Everything else is not a priority in the short term unfortunately....
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Post by p2plender on Mar 1, 2016 11:51:32 GMT
No facility to cancel and my order 'pending' from 7ish this morning. Needs tuning up for sure.
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alender
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Post by alender on Mar 1, 2016 13:15:47 GMT
What they have stated is even more concerning than applying a fee because taking OG's example, if lent at 1.3% and you try to sell out when the current market is 4.0, the loan will almost certainly be repaid before that rate is ever reached again within the term. Makes a mockery of the statement made on the "access your money easily" page Average Sell Out statistics: 10 minutes to match replacement investor Not sure what will happen to the interest if no match is found for a time or until maturity. If you click the all button it gives the capital and interest returned, you then confirm the sell out but this cannot take place due to lack of funds, do you stop earning interest now or is interest still accrued until the sell off takes place or maturity whichever is the sooner. Unless more facts come to light looks like a feature to be careful of if there is not ample funds on the market especially if you have multiple contracts with different rates.
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Post by p2plender on Mar 1, 2016 19:16:17 GMT
my decent wedge liquified and now placed back in at 3.9.
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spiral
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Post by spiral on Mar 2, 2016 8:14:49 GMT
my decent wedge liquified and now placed back in at 3.9. Are you saying that you sold out in order to reinvest at a higher rate? If so, that doesn't match with how alender had it explained to them.
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spiral
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Post by spiral on Mar 4, 2016 9:40:46 GMT
OK, I've had confirmation back from RS that if you sell a loan of a lower rate than current going rate you will have to compensate for the difference in rates.
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alender
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Post by alender on Mar 4, 2016 10:16:29 GMT
That was different from what they told me, be interesting to find out what happens when someone tries this.
For this to work you can end up losing capital if the market has moved up to a point where the new rate pays more interest for the remainder of the loan than your loan has generated, if there is then an early repayment RS make some money.
I tried the calculate button when the market was less than my loan rates and my latest loan was only 1 day old (had older monthly loans) for the full amount of that loan and found there is no interest, does anyone know when RS start paying interest.
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spiral
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Post by spiral on Mar 4, 2016 10:54:47 GMT
I've never sold out any loans, in fact the first time I even looked at the function was in reaction to this thread. If what I was told is correct (as opposed to what alender was told), in order to make the figures add up on the screenshots they'd either have to : Reduce capital, reduce interest, include a fee. I suspect its the middle option which totally hides the fact that your rate is being reduced (unless its negative of course). I suppose if the only change made to this process is the removal of RS's fee, the rate compensation will be shown in the same way that it has always been shown on all markets for selling out loans of a lower rate. Unfortunately I've never done this so can only guess at how its presented.
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