This Loan is T** C****t and many other Loans revisited, and many readers here still seem to miss the major point. It's nothing at all to do with market rates, supply & demand, new investors, successful website & business model etc, etc, it's all about honesty and integrity of the information we are provided with. Due Diligence is now onerous enough without having to constantly check for accuracy even the most basic, fundamental information. I have said before how shocked I am that everyone seems to accept this is normal and acceptable, and does nothing about it. Unless YOU do something these practices will continue and almost certainly get worse, it needs to be nipped in the bud, now. And it's not even a bud anymore, it's flowering. There is RICS and The FCA, they are there to be notified of various practices, contact them. If you don't, you have only yourself to blame when somewhere down the line your investment goes t**s up and you get back 1p in the Pound. (Shakes head at the sight of the Tulip Bulb Buyers.)
well thats a stationary SM for a while....one of the side effects of no SM prefunding...... wonder how much of this loan will not be paid up come Tuesday!
What happens if lots of investors have pre-funded this loan expecting to be able to sell existing loan parts on the SM to cover their losses and when that fails either can't or don't fund their accounts with cash? Does their loan part get cancelled such that even more of this loan hits the SM? Or do they get "punished" in some way for irresponsible pre-funding?
Not a position I find myself in, I am just genuinely curious given the current state of the SM as I suspect many investors could find themselves in that position. Could have a positive effect by further sharpening people's focus on their pre-funding levels. Yes the "no sale of unfunded loan parts" rule change helped, but I don't think it even came close to eliminating irresponsible pre-funding levels.
PLEASE NOTE : The opinions and observations that I display on this forum are of a personal nature. I am not a professional within the financial sector, I represent no platform and my remarks should not be taken as advice. I accept no responsibility or liability for the accuracy, content, completeness, legality, or reliability of the information contained in my posts.
What happens if lots of investors have pre-funded this loan expecting to be able to sell existing loan parts on the SM to cover their losses and when that fails either can't or don't fund their accounts with cash? Does their loan part get cancelled such that even more of this loan hits the SM? Or do they get "punished" in some way for irresponsible pre-funding?
Not a position I find myself in, I am just genuinely curious given the current state of the SM as I suspect many investors could find themselves in that position. Could have a positive effect by further sharpening people's focus on their pre-funding levels. Yes the "no sale of unfunded loan parts" rule change helped, but I don't think it even came close to eliminating irresponsible pre-funding levels.
At present, if you you don't subsequently fund a pre-funded loan part it just gets cancelled after a few days and chucked on the SM heap without any further consequence. It's basically a free option. The same free option was given when buying loan parts on the SM when there was INPL.
It wouldn't surprise me if £4M+ is available by the end of the week.
Hmmm, if you are right and you probably are who is going to fund the shortfall if the borrower needs to drawdown?
EDIT I wonder if the other two loans advised in the same email will go lbe today
Last Edit: Mar 9, 2017 13:42:50 GMT by dualinvestor
PLEASE NOTE : The opinions and observations that I display on this forum are personal and do not necessarily concur with the proprietors of the forum. I represent no platform or other organisation in my postings and my remarks should not be taken as advice. I accept no responsibility or liability for the accuracy, content, completeness, legality, reliability of the information contained in my posts. Or for people acting or refraining to act upon them.
What happens if lots of investors have pre-funded this loan expecting to be able to sell existing loan parts on the SM to cover their losses and when that fails either can't or don't fund their accounts with cash? Does their loan part get cancelled such that even more of this loan hits the SM? Or do they get "punished" in some way for irresponsible pre-funding?
Not a position I find myself in, I am just genuinely curious given the current state of the SM as I suspect many investors could find themselves in that position. Could have a positive effect by further sharpening people's focus on their pre-funding levels. Yes the "no sale of unfunded loan parts" rule change helped, but I don't think it even came close to eliminating irresponsible pre-funding levels.
At present, if you you don't subsequently fund a pre-funded loan part it just gets cancelled after a few days and chucked on the SM heap without any further consequence. It's basically a free option. The same free option was given when buying loan parts on the SM when there was INPL.
That is what I thought, although it seems pretty unsustainable to me and creates a totally false market. Surely SS will need to introduce some stricter consequences, like banning/restricting pre-funding for repeat offenders...
PLEASE NOTE : The opinions and observations that I display on this forum are of a personal nature. I am not a professional within the financial sector, I represent no platform and my remarks should not be taken as advice. I accept no responsibility or liability for the accuracy, content, completeness, legality, or reliability of the information contained in my posts.
At present, if you you don't subsequently fund a pre-funded loan part it just gets cancelled after a few days and chucked on the SM heap without any further consequence. It's basically a free option. The same free option was given when buying loan parts on the SM when there was INPL.
That is what I thought, although it seems pretty unsustainable to me and creates a totally false market. Surely SS will need to introduce some stricter consequences, like banning/restricting pre-funding for repeat offenders...
It was a big problem on the SM before, but I don't think its much of an issue for the PM. In the worst case where loans have been fully subscribed all it means is that people who wanted (and could fund) a higher allocation will be scaled back. The unpaid for loans will just be thrown on the SM a few days later and can be purchased by those who want it then. If the loan wasn't fully subscribed, then it wouldn't have really affected anyone as the excess loans would have been placed on the SM in any case. The bottom line is that SS is probably losing out on a few days interest if the loan could have been fully funded on the PM and SM than otherwise the case. The issue was much bigger in the SM where lenders could perceptually run a deficit via INPL by churning loans and effectively monetise the free credit INPL offered.
Cracking down on PM prefunding isn't going to benefit SS much and will only make some lenders more conservative about assessing their ability to liquidate existing loans to fund new purchases which will significantly adverse SM liquidity to the detriment of most lenders, particular new lenders who are seeking to quickly build a diversified book.
I know that this is selfish attitude but I am pleased that this loan is not fully funded because if it had become fully funded, I did not believe SS would offer "good" 12% loans in the future. Now I hope that this new policy will change and they we will have loans that have a better risk reward ratio.
Starting at about 10:30 am on Wednesday I sold a couple of loan parts, cancelled my pre funding for this loan and just before 11:00 am withdrew all the spare cash from my account. In the afternoon I got an email time stamped 15:34 giving me the advance go live notice for the loan and as usual telling me to check my pre funding. No problems apart from the fact that I have just been told I have got a £1000 allocation and my account stands at -£1000. It doesn't look like I can track changes to pre funding to prove anything, so apart from the 'Contact Us' email that I have already sent, is there much that I could/should do? Thanks.