pickles
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Post by pickles on Aug 28, 2017 8:06:00 GMT
So all the older "ready to sell should something better come along" parts were dumped. Along with all the "I'm holding multiple parts of these property loans and will sell them at 2 payments left" -- with no control any more on what to sell, and when, my strategy is knackered. All this has done has hastened the remaining wind-down, for me. I've been busy selling anything with fewer than 6 payments to go and buying into longer dated property. With no choice on what to sell the only option is to hold for 5 months then sell out everything. It's just occurred to me that the new regime requires you to choose a percentage for diversity - I've been happy to hold reasonable large positions in property loans on the basis they can be sold near to maturity. What will happen in Sept? Will the autobidder step in and force a sell-out of anything over the percentage? Then if I don't have autobuy turned on, my total will be lower which will push the percentage up again and it will sell another load?
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pickles
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Post by pickles on Aug 24, 2017 19:10:19 GMT
I don't see why not, people buy and sell defaulted loans in the non-P2P world.
Taking this thought a stage further, how long before we have derivatives on P2P? Credit Default Swap on MTAW752 anyone?
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pickles
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Post by pickles on Aug 22, 2017 19:45:40 GMT
Maths question:
Background
I'm at the back of the queue for the sell-out having put my request in on the last day. There are 29 days until I get the £100 bonus for being in for a year. Knowing my luck the account will be closed on day 28.
I have about £9000 left in the five year with four years to run.
Question
Would I be better off selling the standard way and taking the cost of early redemption, or taking the free sell-out and probably losing the £100?
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pickles
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Post by pickles on Aug 21, 2017 6:58:58 GMT
Missed this bit: A simpler selling process Just tell us how much you’d like to withdraw and you can sell a selection of your loan parts directly to other investors. The option to sell individual loan parts and set a premium or discount will be removed.
Oh dear "A selection" implies you get to select. That's not what they mean is it?
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pickles
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Post by pickles on Aug 18, 2017 17:03:20 GMT
Unless things have changed massively in the last year or so, your third option is a complete non-starter. Standard corporation tax would not apply for such a company, for exactly that reason.
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pickles
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Post by pickles on Jul 30, 2017 16:01:22 GMT
Thanks Paul. I thought I might be missing some obvious button hidden in plain sight on the website, but clearly not! I have a PhD in physics and getting on for 20 years in fixed income derivatives, but cannot make head or tail of the figures presented.
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pickles
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Post by pickles on Jul 30, 2017 10:02:31 GMT
I have a question about the Reinvestment feature in the 5 year market (but same principle would apply to all other markets). If there are borrowers ready to borrow at 5.0% and my re-investment rate is 4.5%, would my money be lent out at 4.5% or 5.0%? 4.5%! RS is a business making money on the difference between what we lend at, and what borrowers pay (plus fees). If rates go too low I withdraw and place it elsewhere. That's what I would have expected, but last week I forgot to reset my rolling reinvestment rate (or rather forgot I had some incoming interest). When I saw the email for a matched order I assumed it would have been at the rate I set when rates were low, but it was actually placed at the higher current rate.
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pickles
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Post by pickles on Jul 30, 2017 9:55:35 GMT
I'm sure all the information is there, but is there a sensible way of getting it out of the site without drilling down into the financials of every loan one by one and painstakingly extracting the numbers from within a pile of useless/irrelevant carp?
Even the numbers on the dashboard don't add up:surely "payment outstanding" should equal "invoiced" - "payment received"? It's not even close. Then there's the miriad refinancing: why are some refinanced loans shown as the full amount outstanding, but "expired", others are "live" with a zero outstanding. The various reports seem to give pages and pages of the same numbers repeated. The columns in the dashboard views are mostly a waste of screen space filled with zeroes or "--".
It would be nice to find out exactly how much is in each live loan, what the repayment dates are for interest and capital, and the "current" end date. Any tips?
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pickles
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Post by pickles on Jul 27, 2017 11:53:59 GMT
Hi Pickles. <snip> The conclusion that I've made in the following hypothetical example, is that it doesn't make sense to buy property loans with one month remaining for a 0% premium. Do you disagree? I agree with you 100% on that! I'm not sure why, but parts sell at a premium with 2 or 3 remaining payments, leaving an effective rate to the buyer of 4 - 4.5%. I have no idea why, as you say it doesn't make sense. You asked about my vague comment on your property blog, so to be a bit more specific: You can't sell anything on the secondary market with only a single payment left If you have a 12 month 10% loan and it's 12 months late, you don't have an effective 5% loan, you have an effective 11% loan. 1 in 100 property loans don't default. You can't take the defaults across all loan types, segment by A/B/C rating and apply that to property loans, because they have a different risk profile. If a property loan is refinanced that doesn't show a high risk of the new loan defaulting, all it shows is that the original loan was not for long enough. It's completely normal for property loans, everywhere: builders *always* underestimate! I'm sure there were others...
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pickles
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Post by pickles on Jul 26, 2017 6:58:14 GMT
OK, I've just read the OP's property loans blog. I can forgive the poor grammar and spelling mistakes, it's only a blog. However, it presents erroneous conclusions from incorrect facts and uses figures plucked from the air that bear no relation to reality. I know they are examples based on round numbers to make them easy to follow, but the presentation indicates the results are what actually happens, when it clearly does not. Hopefully the book itself has been proof-read.
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pickles
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Post by pickles on Jul 20, 2017 20:20:18 GMT
Standard loans can be defaulted at any time, so selling just before redemption is not necessarily a better policy. Loans with rollup + bullet, especially those where a monthly repayment is funded from an initial retention are more likely to be able to cover up any problems until the very end.
Having said that, after seeing this thread I put some of my AE loans on the SM this morning, simply because it's clear the SM will be swamped with buyers on the 31st. It's a strange thing but there are plenty of buyers for less than two weeks' worth of debt!
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pickles
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Post by pickles on Jul 20, 2017 16:49:21 GMT
Well, I would be a very happy bunny if the %ages were switched round:
P2P: 50% S&S ISA: 25% Rainy day fund (in premium bonds for easy access): 24% BitCoin: 1%
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pickles
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Post by pickles on Jul 19, 2017 11:21:03 GMT
I opened 2 accounts last year, with the promise of £100 bonus if I kept my money in a year..well one is about 10 days off that, the other about 50...in a dilemma about what best to do..the cynic in me thinks the email is trying to encourage investors to sell out as they have over committed with the £100 offer ??..Thoughts ? If I understand correctly you have 30 days to exercise the fee-free sellout, so you can still get the bonus on the first of those accounts, provided there is someone willing to take on your loan parts Can anyone tell me whether the proceeds of a sell-out would go into the holding account or be returned directly to a bank account? I've been thinking of getting rid of my five-year stuff rather than letting it gradually wind down as four more years is too high risk even at 6%. If it goes into the holding account I can leave a grand in there for the extra two months to get the £100 bonus, if not it's probably more expensive than selling out by the normal method at some point in the future.
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pickles
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Post by pickles on Jun 20, 2017 17:15:01 GMT
And tranche 1 of the renewal is already on the SM, at par, ???
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pickles
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Post by pickles on Jun 18, 2017 11:21:38 GMT
Strictly speaking Luton is not actually late yet - payment date is today and shown as "processing". BH (Cumbria) was due to pay last Friday but is still showing as 0 days late.
I've noticed a strange phenomenon on the SM where my property loans are snapped up just after the third payment from the end. This is despite having the max premium applied and my having other more attractively priced parts for sale but half-way between payment dates (ie 1.5 or 2.5 months from final payment). I'm not sure if they don't realise how the interest works on parts bought on the SM? But, that aside, they are buying a two month loan paying around 4% with a high chance of not paying on time and being unsaleable. You could do better than that buying at a decent rate and selling at par, even after fees. Or are they actually hoping they go overdue, so they get 12% for an unknown period? It's a bit of a mystery.
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