baldpate
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Post by baldpate on Mar 8, 2016 8:55:51 GMT
Hi parag, a couple of months ago - in your Xmas email message to lenders in fact - you said :My internal clock tells me we've passed "early in the new year" and are entering "spring of the new year"  . Have you any update you can share about these new plans, or even on when you will be able to share them with us? I imagine there may be quite a few lenders, such as myself, who like the Funding Empire product and have invested in the ABL series, and are eager to see where you intend to take the platform in the future: the recent 'feeding frenzy' on ABL039 says something about the pent-up demand, I think.
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Post by parag on Mar 8, 2016 20:54:53 GMT
baldpate We are currently in the early product development stage for our new product. We will be emailing a segment of our lenders over the coming couple of weeks to garner their initial views on the product details that have been confirmed so far; I will make sure you get the email. The new product will be launched under a new brand and is quite different to the current offering on FE. I can confirm that it will be a property backed product which will utilise the vast origination and servicing experience Paratus has in that space. It will also be a 'drop and go' product with varying terms and rates which moves away from lenders having to wait for individual loan requests to be listed in order for them to place bids on. It is significantly different to current property backed offerings in the P2P space and has a number of USP's and unique lender protection mechanisms. Regards, Parag
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baldpate
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Post by baldpate on Mar 8, 2016 21:09:46 GMT
Thanks, parag - I wait with interest!
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ben
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Post by ben on Mar 8, 2016 21:54:43 GMT
look forward to this too as I think I will skip the fastest fingers first tomorrow, was first one tried other day few mins late missed it so will probably wait for this
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kaya
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Post by kaya on Mar 11, 2016 9:06:59 GMT
New one-off loan proposition at Funding Empire available, but can they raise that amount of cash at 8+1%?
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ben
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Post by ben on Mar 11, 2016 9:11:29 GMT
I think they will and if it gets fairly close the new (ish) parent company will probably underwrite it to try and kickstart funding empire, if they only got about 30% then they may not but if it is 70/80% they probably will.
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Post by pepperpot on Mar 11, 2016 12:44:09 GMT
New one-off loan proposition at Funding Empire available, but can they raise that amount of cash at 8+1%? IMHO the rate offered is lower than I would wish for. Whilst I have some funds in the existing loan, I think I'll pass on this one. May reconsider if the rate rises above 10% plus the bonus. I agree, it's not the rate I aim for either, but that LTV looks nice... and that level of cover is just what I'm looking for at this stage in the cycle. parag, I'm being lazy and haven't read the val. report yet, is the £650k a 'bricks-n-mortar' or 'trading business' valuation?
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Post by parag on Mar 11, 2016 13:00:29 GMT
pepperpot It's a bricks and mortar valuation. Also worth bearing in mind is that the loan will amortise monthly as opposed to some of the higher rate offerings elsewhere that only pay interest monthly.
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Post by loanstar on Mar 11, 2016 17:43:58 GMT
I know that FE are just testing the water, so for what its worth here is my reaction. The security is good both in terms of LTV and how marketable the property. The borrower also has a track record of paying a loan without problem. Add to this it is not interest only and it starts to sound interesting. However the 8+1 is at the lower end of what other P2P platforms are offering. As a very, very simple measure of interest check how many viewers there (on this forum) are at SS where a LTV of 70% returns 12%, but at FC one of the top posts is about those saying good bye because of interest only property loans at 8% (7% after fees). There maybe a middle ground that FE could explore.
The question that FE want the answer to is what rate of return is needed to attract new lenders, coupled with LTV etc?
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Post by parag on Mar 12, 2016 18:26:31 GMT
Jaydee loanstar Thanks for your views and comments, very useful. We are going back to the borrower to put some of these suggestions to them. They may not be happy to increase the rate given the low LTV but we will be able to get their views on this along with their views on an interest only loan as opposed to an amortising loan. On another note, our new product will be an interest only product so that will help lenders who are looking for this type of repayment profile as opposed to monthly amortising loans.
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ben
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Post by ben on Mar 12, 2016 18:41:09 GMT
Jaydee loanstar Thanks for your views and comments, very useful. We are going back to the borrower to put some of these suggestions to them. They may not be happy to increase the rate given the low LTV but we will be able to get their views on this along with their views on an interest only loan as opposed to an amortising loan. On another note, our new product will be an interest only product so that will help lenders who are looking for this type of repayment profile as opposed to monthly amortising loans. To be honest I quite like the amortising loans which was one of reasons what attracted me in the first place, I know it lowers return slightly but unless a loan goes bad in first few payments the chances are your losses would be less then if it was an interest only loan. Is this planning on being a one of larger loan or is this the way you intent to go forward?
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Post by parag on Mar 12, 2016 18:54:09 GMT
Jaydee loanstar Thanks for your views and comments, very useful. We are going back to the borrower to put some of these suggestions to them. They may not be happy to increase the rate given the low LTV but we will be able to get their views on this along with their views on an interest only loan as opposed to an amortising loan. On another note, our new product will be an interest only product so that will help lenders who are looking for this type of repayment profile as opposed to monthly amortising loans. To be honest I quite like the amortising loans which was one of reasons what attracted me in the first place, I know it lowers return slightly but unless a loan goes bad in first few payments the chances are your losses would be less then if it was an interest only loan. Is this planning on being a one of larger loan or is this the way you intent to go forward? I share your view and thought that is what most lenders would think. The BLX model will remain as it is; capital and interest repayments. We are only considering the loan request we emailed our lenders about as they are an existing borrower of ours with an excellent repayment record to date. I don't want to have to pass them to another lender as we have an existing relationship with them that I am more than happy with. The most common piece of feedback on this loan proposal was the rate not the fact it will amortise monthly although I totally understand and appreciate the view of Jaydee. The new product will be launched under a new brand and website and the initial launch product will be an interest only product with some cases where there will be capital and interest repayment in the early months given the nature of the proposed product. I am in the process of putting together an email for our lenders which will give them details of the new model and provide a chance for them to give us some feedback.
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ben
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Post by ben on Mar 12, 2016 19:22:40 GMT
Maybe if you do something similar like what broadoak do on MT i.e 5% first loss would make a few more interested on the rate offered as would reduce the risk even more.
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Post by parag on Mar 12, 2016 20:04:36 GMT
Maybe if you do something similar like what broadoak do on MT i.e 5% first loss would make a few more interested on the rate offered as would reduce the risk even more. We are currently exploring this option for the new product as the proposed structure would allow this. It is not something we can do with the current product on the FE site as we are not using our own cash to lend.
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ben
Posts: 2,020
Likes: 589
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Post by ben on Mar 12, 2016 20:16:58 GMT
Maybe if you do something similar like what broadoak do on MT i.e 5% first loss would make a few more interested on the rate offered as would reduce the risk even more. We are currently exploring this option for the new product as the proposed structure would allow this. It is not something we can do with the current product on the FE site as we are not using our own cash to lend. That is good to hear on the new product as I do like the broadoak one as it gives extra security and they carry the same risk.
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. Have you any update you can share about these new plans, or even on when you will be able to share them with us? I imagine there may be quite a few lenders, such as myself, who like the Funding Empire product and have invested in the ABL series, and are eager to see where you intend to take the platform in the future: the recent 'feeding frenzy' on ABL039 says something about the pent-up demand, I think.
