Greenwood2
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Post by Greenwood2 on Apr 25, 2016 9:07:53 GMT
Does the borrower have an exit strategy, are they ever likely to be able to actually repay any of these loans?
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SteveT
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Post by SteveT on Apr 25, 2016 9:34:44 GMT
Does the borrower have an exit strategy, are they ever likely to be able to actually repay any of these loans? [Mod hat off] If the business continues to grow successfully then I assume they can either carry on turning over the stock, renewing existing loans indefinitely and adding new loans as they expand their balance sheet, or else repay these loans with lower cost finance from another lender. If not, hopefully there would be enough cash returned from selling down the stock to repay existing loans. That's the risk we take in return for receiving 12%
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ben
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Post by ben on Apr 25, 2016 11:31:30 GMT
In the short term does not make much sense for them to pay it they will be investing the profits into expanding, in the future they may want to or be able to get better credit themselves elsewhere
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davex
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Post by davex on Apr 25, 2016 14:30:37 GMT
Wondering if there is any point in splitting funds across both portfolios, or just investing the initial 1% in 1 ? ISTM the risks are all related to platform and/or the originator. Would be interested in Ed's MoneyThing take on this, you have 30 minutes before I invest. Not to put the pressure on, of course.
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Post by MoneyThing on Apr 25, 2016 14:35:27 GMT
Wondering if there is any point in splitting funds across both portfolios, or just investing the initial 1% in 1 ? ISTM the risks are all related to platform and/or the originator. Would be interested in Ed's MoneyThing take on this, you have 30 minutes before I invest. Not to put the pressure on, of course. ...24 minutes and 35 seconds to go... Putting platform/borrower risk aside, then in reality there is little difference in which ever Managed Portfolio you bid on (including the ones already funded). Regards, Ed
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davex
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Post by davex on Apr 25, 2016 14:48:46 GMT
Thanks Ed. Got to be record for responsiveness.
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ben
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Post by ben on Apr 25, 2016 15:19:40 GMT
I split it 50/50 in case I want to sell some in the future in between the 6 months unlikely as I generally invest what I am happy to hold but occasionally if a better offer comes up I will sell a bit then gives me the option to try to sell from 2 portfolios rather then 1 if lots of other people trying to sell to
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Post by Financial Thing on Apr 25, 2016 15:24:12 GMT
The harder issue with these loans is the ethics in ultimately lending people money to buy relatively high priced cars at such APR's.
If we considered only investing based on ethics, it would rule out a good portion of p2p lending.
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gt94sss2
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Post by gt94sss2 on Apr 25, 2016 15:37:50 GMT
I see Ablrate are now offering an ACF loan as well..
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james
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Post by james on Apr 25, 2016 15:53:29 GMT
I see Ablrate are now offering an ACF loan as well.. One main difference in terms there is term, not auto-renewing indefinite term but 36 month term. That works nicely with their secondary market where it's their practice to ensure that there is no early repayment risks for trades above par. Each way has its uses, with the longer term nice if you want more borrower lock in at the rate vs the more assured lender exit flexibility at the six month renewable version. While there's not that much admin overhead comparing renewing with 36 months the 6 month renewing one is likely to have less work if you just want to keep your money invested. However there are two substantial differences beyond that. The current MoneyThing offer is loans secured on HP agreements while the current Ablrate one is a stocking loan more like ACF371 (same borrower as on Ablrate) or AE372 than the currently open AE291/AE392.
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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 Apr 25, 2016 16:09:16 GMT
This thread is all over the place now, meandering between borrowers is getting confusing.
Should be noted that both Abl & MT loans have a CG on ACF so there is potential linkage in the event of a default
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