secondary market and premium purchases

investorl

Posts: 35

Likes: 5

secondary market and premium purchases Nov 5, 2016 8:04:11 GMT

Quote

Post by investorl on Nov 5, 2016 8:04:11 GMT

I'm curious what happens when I purchase loan with premium on SM and this loan is than bought back for any reason during first month.

For example :

Loan : € 9.85

Total Discount/Premium 1.5%

Total price € 10.00

I suppose that loan originator will pay only €9.85, right? So for first month and half there is risk that such loan will be unprofitable.

Does anyone have experiences with this?

Last Edit: Nov 5, 2016 8:04:50 GMT by investorl

buttchopf23 P2P Blogger Posts: 592 Likes: 131	secondary market and premium purchases Nov 5, 2016 9:12:49 GMT via mobile Quote Select Post Deselect Post Link to Post Back to Top Post by buttchopf23 on Nov 5, 2016 9:12:49 GMT You are right. Thats the risk of premiums: early redemption
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zeverare Posts: 48 Likes: 32	secondary market and premium purchases Nov 5, 2016 10:59:50 GMT Quote Select Post Deselect Post Link to Post Back to Top Post by zeverare on Nov 5, 2016 10:59:50 GMT I have the opposite experience: buying with a discount and early repayment the next day So, yes you have to be careful.

buttchopf23 P2P Blogger Posts: 592 Likes: 131	secondary market and premium purchases Nov 5, 2016 12:00:16 GMT via mobile Quote Select Post Deselect Post Link to Post Back to Top Post by buttchopf23 on Nov 5, 2016 12:00:16 GMT Me too, discount is even better when settled the next day, gives a nice return. That was the reason I sometimes had a return of over 20% per annum
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investorl Posts: 35 Likes: 5	secondary market and premium purchases Nov 5, 2016 13:59:30 GMT Quote Select Post Deselect Post Link to Post Back to Top Post by investorl on Nov 5, 2016 13:59:30 GMT Thanks for replies. I didn't realize it before.

secondary market and premium purchases

Post by investorl on Nov 5, 2016 8:04:11 GMT

Post by buttchopf23 on Nov 5, 2016 9:12:49 GMT

Post by zeverare on Nov 5, 2016 10:59:50 GMT

Post by buttchopf23 on Nov 5, 2016 12:00:16 GMT

Post by investorl on Nov 5, 2016 13:59:30 GMT