bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Apr 1, 2020 10:41:33 GMT
Yes Chris made a statement with the numbers in. He's not going to post the thousands of calculations that drove this estimate. No-one decides if a loan is performing. There is a charge against every loan but the charge is not paid by the lender unless the loan in question returns cash. So for a loan that is in effect dead the charge will never be paid. Well what are these numbers, I only saw a statement that mentioned 85k. You do not need all of the thousands of calculations, just some totals which will allow you to see how this is working (against you), it is a bit like saying that if 1m people have a £1, the only way you know the total amount is make a 1m additions.
So how do we know which loans we will be charged a monthly Fees, if no one decides this it will be impossible to implement.
All of the loans are charged a monthly fee but lenders only ever pay it if the loan in question ever returns any cash.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Apr 1, 2020 10:11:34 GMT
AC have told us the numbers (well Chris has). You can't expect them to release all lender balances and transactions so you can verify this. No its not. The fee is charged on a per loan basis so only if cash is returned from the loan in question. If a loan is non performing there will be no fee charged. I did not see any numbers (perhaps they are complex and of the imaginary type) just a statement and some sort of estimate from Chris but sadly lacking in any real numbers.
So who decides which loans are performing, if that is AC and they charge Fees based on this seems like a conflict of interests. More information required.
Yes Chris made a statement with the numbers in. He's not going to post the thousands of calculations that drove this estimate. No-one decides if a loan is performing. There is a charge against every loan but the charge is not paid by the lender unless the loan in question returns cash. So for a loan that is in effect dead the charge will never be paid.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Apr 1, 2020 9:45:33 GMT
Not possible to verify the actual numbers of course but it does make sense. If you have £250k invested (say) then you would initially benefit from a proportional system, but as smaller investors get knocked out (fully repaid) you eventually become a smaller investor (relative to others) yourself and would then start being penalised by the proportional system. Under a true proportional repayment system all investors should be fully repaid on the same date. AC should be able to verify the numbers.
AC have told us the numbers (well Chris has). You can't expect them to release all lender balances and transactions so you can verify this. No its not. The fee is charged on a per loan basis so only if cash is returned from the loan in question. If a loan is non performing there will be no fee charged.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Apr 1, 2020 9:42:36 GMT
As per the figures in my previous post, you need to have over £85k invested in a single account to have received more cash via pro-rata allocation. Each account is allocated separately at present, so you could have that £80-85k in each of the three access accounts, hence the £240-255k figure. This was calculated by running the calculation through the system, so I can't really show the working. You'll have to take it or leave it, it wasn't actually the reason for the decision to implement the flat allocation, I gave that reasoning before, I was just curious so ran the numbers. Heading to bed now so won't reply again, but will try and spend some more time on the forum tomorrow albeit with a more technical hat on. chris have you got out of bed yet? If so can you please answer the question on how you have come to the conclusion that flat payments are better for accounts with below £85k so we can better understand what you are doing and please illustrate it with figures. Didn't I already do that?
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Apr 1, 2020 7:55:41 GMT
Please explain how you got your estimate if you have under £1m invested in a single access account then your time to 100% return of capital would be quicker with the flat rate system as I cannot understand how this can be the case. At present I have lost all confidence in AC and seeing most of my money again
Not possible to verify the actual numbers of course but it does make sense. If you have £250k invested (say) then you would initially benefit from a proportional system, but as smaller investors get knocked out (fully repaid) you eventually become a smaller investor (relative to others) yourself and would then start being penalised by the proportional system. Under a true proportional repayment system all investors should be fully repaid on the same date. So consider a simple scaled down scenario. 8 investors, 5 with £10k in, 1 with £40k, 1 with £85k and 1 with £200k. If £20k is repaid a day the profile would look like this under a flat v proportional repayment system for the £85k investor. They initially benefit under the proportional system but half way through the period them start to lose out. Under a flat rate repayment system they would receive all their money back much quicker.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Apr 1, 2020 7:43:17 GMT
Please explain how you got your estimate if you have under £1m invested in a single access account then your time to 100% return of capital would be quicker with the flat rate system as I cannot understand how this can be the case. At present I have lost all confidence in AC and seeing most of my money again
Not possible to verify the actual numbers of course but it does make sense. If you have £250k invested (say) then you would initially benefit from a proportional system, but as smaller investors get knocked out (fully repaid) you eventually become a smaller investor (relative to others) yourself and would then start being penalised by the proportional system. Under a true proportional repayment system all investors should be fully repaid on the same date.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 19:31:39 GMT
Seems a perfectly reasonable proposal to me, apart fron this aspect highlighted by bg What I will strongly object to is being charged a fee on loans that are defaulted and irrecoverable. #146 for example was written off many years ago and the security is sold. I still have a £27k balance sitting on the system however and if I am to be charged a 0.9% annual fee on that I do not think its acceptable. Ditto #227 or any other loan that's suspended. The charge should be based on the recently set capital valuations not the outstanding capital. stuartassetzcapital - there has been a longstanding need for AC to write many of these loans off our loanbooks, and the various excuses regarding software development time have worn rather thin. I fully support the general approach you've taken, but those of us in multiple of the early high risk loans that defaulted are being penalised here for our early support of AC before risk modelling was perfected. I have asked for clarification on this point and have been told that the fee is only charged if there is cash to pay it and as there is no cash from defaulted loans there is therefore no charge on them. This implies to me that the charge is done on a loan by loan basis and not on the total amount lent.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 18:17:49 GMT
Also, is it not the case that platform fees can't be offset against our taxes, so we pay tax on, say, the full £1,000 earned in loan interest rather than on £1,000 minus the 0.9% fee i.e. £991? This is an important question, hopefully they clarify it soon.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 18:02:40 GMT
What I will strongly object to is being charged a fee on loans that are defaulted and irrecoverable.
#146 for example was written off many years ago and the security is sold. I still have a £27k balance sitting on the system however and if I am to be charged a 0.9% annual fee on that I do not think its acceptable. Ditto #227 or any other loan that's suspended.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 17:04:45 GMT
I got a repayment of 40% of #439 and 69% of #372.
Wasn't expecting that.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 14:23:34 GMT
No but its your money that you will lose if you stop developments being funded. If Assetz want me to invest in further tranches they should ask me. Assetz have multiple sources of funds aside from taking what I have uninvested in the Access accounts.
Assetz was formed before the Access Accounts were created so I don't accept that Assetz continuation is dependant on them
Its fine for you not to accept it but if AC can't fund it from other sources then your money is lost. These are exceptional times. If you are happy with that then fair enough.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 14:08:32 GMT
But on loans that require further funding they have not done this. It's all well and good saying AC should have done things differently but that doesn't help anyone and its our money that is invested, its our money on the line. Well I suggest you raise that issue with Assetz. Certainly not my responsibility.
No but its your money that you will lose if you stop developments being funded.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 13:46:59 GMT
OK but leaving the commitments issue behind, if AC can't fund the future dev commitments (which I calculate to be around £100m) what do you think happens to our investments in these loans? I would imagine we would lose the majority if not all of them but happy to hear your opinion. Assetz will have no doubt seen the issues that faced Lendy when they failed to continue lending and should have made contingency plans. Eg as we approached the threat of a no deal brexit last year. Plans could have included raising the entire value of the loan and only releasing it on a tranche by tranche basis. It would be surprising if they hadn't considered this.
Another option would be increasing the interest rate at the sacrifice of the platform fees. But on loans that require further funding they have not done this. It's all well and good saying AC should have done things differently but that doesn't help anyone and its our money that is invested, its our money on the line.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 13:44:42 GMT
I don't think so, they do have other potential funding sources (institutions, the £15m they just got from British Business Investments, underwriters etc). I wouldn't worry about leaving cash in your cash account. It is held in a segregated client account that AC can't touch. The £100m I calculated by subtracting Principal Remaining from Total Facility for all loans. That's £100m. It is however likely to be lower than this as some loans will be in the process of being paid down (as properties are sold etc) or the total facility may not be needed. In fact it is likely substantially lower, I will amend my post. Whilst that money may be in a segregated account, if Assetz go into administration you are unlikely to be able to get hold of it very quickly as we have seen in the cases of other platform failures. True but AC are not on the cusp of going into administration.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Mar 31, 2020 13:23:35 GMT
If future commitments are £100M, then aren't they screwed already? I'm currently leaving my free cash (£200 so far!) on the platform - should I be withdrawing it every time it gets above a tenner - to prevent it being grabbed. Interest day tomorrow, me thinks I should bank it. I don't think so, they do have other potential funding sources (institutions, the £15m they just got from British Business Investments, underwriters etc). I wouldn't worry about leaving cash in your cash account. It is held in a segregated client account that AC can't touch. The £100m I calculated by subtracting Principal Remaining from Total Facility for all loans. That's £100m. It is however likely to be lower than this as some loans will be in the process of being paid down (as properties are sold etc) or the total facility may not be needed. In fact it is likely substantially lower, I will amend my post.
|
|