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Post by befuddled on Sept 27, 2017 12:13:18 GMT
I hope someome can clarify a pretty basic questions on what this means:
Changing your Reinvestment Setting for a market will update ALL new reinvestment orders for that market. NOTE existing Reinvestment orders still on the market will NOT be updated.
...what is an existing reinvestment order ?
I was hoping to be able to gradually move repaid capital and interest from 5yr to rolling by setting 5 year reinvestment to "rolling" and "all", but does the sentence above mean reinvestment
instructions for existing funds can't be changed.
I was hoping to be able to gradually transfer capital and interest out of 5yr without incurring costs...
Thanks
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Post by beeje13 on Sept 27, 2017 12:41:33 GMT
If you have an order on the market that is yet to be matched, the reinvestment setting rate setting will not change the offer rate of that order. Does this answer your question?
You can however manually change the rates of orders not yet matched. But I don't think this is what you are asking about here.
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Stonk
Stonking
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Post by Stonk on Sept 27, 2017 13:28:13 GMT
I hope someome can clarify a pretty basic questions on what this means: Changing your Reinvestment Setting for a market will update ALL new reinvestment orders for that market. NOTE existing Reinvestment orders still on the market will NOT be updated.
...what is an existing reinvestment order ? I was hoping to be able to gradually move repaid capital and interest from 5yr to rolling by setting 5 year reinvestment to "rolling" and "all", but does the sentence above mean reinvestment instructions for existing funds can't be changed. I was hoping to be able to gradually transfer capital and interest out of 5yr without incurring costs... Thanks Simply: if you make the settings you proposed, you will achieve what you wanted to.
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Post by befuddled on Sept 27, 2017 13:32:56 GMT
Beeje13 ..not exactly If you placed £2k in 5yr three years ago, every month some capital and some interest is raised. The default setting is to reinvest back in 5yr If two years later you change reinvestment setting to reinvest "all" in "rolling" Does this new instruction apply to future funds generated from the initial 2k deposit (or are all reinvestment instructions associated with the £2k deposit "fixed" from the point deposit made) Are these the "existing reinvestment orders", which RS says these can't be changed. ...it doesn't sound unreasonable to remove paid up capital and interest from 5 year contract Maybe I need to investigate the withdrawal feature. My aim is to reduce amount in 5yr without incurring fees - I do appreciate pulling out interest and repayments will still leave the account open for 5 years - but over time the exposure to risk will be less. ![]() ![]() ![]() Attachments:
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robski
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Post by robski on Sept 27, 2017 14:19:17 GMT
My belief is that it means, if you have reinvestment settings to say send 5 year back to 5 year at market rate and you change that to be 5 year but at 6% then its purely what happens to anything thats already on the market but unmatched the statement applies to.
Example, if you had a repayment prior to the change and its looked at the market rate and come up with 5.5%, and as of the point you change its unmatched, or matched but not yet written, then that amount will remain at 5.5%, and from that point onwards only will your new repayments be listed at 6%, it will not got the 5.5% one and change that to 6%
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Stonk
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Post by Stonk on Sept 27, 2017 19:14:30 GMT
Beeje13 ..not exactly If you placed £2k in 5yr three years ago, every month some capital and some interest is raised. The default setting is to reinvest back in 5yr If two years later you change reinvestment setting to reinvest "all" in "rolling" Does this new instruction apply to future funds generated from the initial 2k deposit (or are all reinvestment instructions associated with the £2k deposit "fixed" from the point deposit made) Are these the "existing reinvestment orders", which RS says these can't be changed. ...it doesn't sound unreasonable to remove paid up capital and interest from 5 year contract Maybe I need to investigate the withdrawal feature. My aim is to reduce amount in 5yr without incurring fees - I do appreciate pulling out interest and repayments will still leave the account open for 5 years - but over time the exposure to risk will be less. The reinvestment settings are less complicated than you are imagining! An "order" is an offer to lend money (i.e., a specified amount at a specified rate) which has not yet matched. Orders arise either (a) when you enter them manually, offering money from your holding account; or (b) as a result of your reinvestment settings being applied to a payment/payments that has just been recieved. The two scenarios result in orders that are fundamentally the same, it's just that type (b) orders -- "reinvestment orders" -- have been automatically created for you and often you might not even be aware it happened (especially if they matched quickly). It sounds like you might be mixing up the concepts of "reinvestment order" and "reinvestment instruction"; the latter are rules about how to create reinvestment orders. You are free to change your reinvestment instruction, and it *will* affect all reinvestment orders created from that time forward. The warning about "existing reinvestment orders" is simply saying that if you have unmatched reinvestment orders on the market resulting from payments in the past, then changing your reinvestment instruction will not change those orders. Let's say that two weeks ago your instruction was to reinvest in the 5 Year market at 7%, and you received a payment of £100. An order is created for £100 at 7%. Suppose that order hasn't matched yet - then this is an "existing reinvestment order". If you now change your reinvestment instruction to be Rolling at 4%, the 5 Year / £100 / 7% order will continue to exist, unchanged. In two weeks time when you receive the next £100, it will be offered on Rolling at 4%. Clear as mud? Anyway, your aim of progressively reducing the amount you have invested in the 5 Year market without incurring fees WILL be achieved by diverting repayments (principle and interest) onto the Rolling market, which WILL be achieved by making the changes you propose to your reinvestment instruction.
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sl75
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Post by sl75 on Sept 27, 2017 20:50:15 GMT
I have vague recollections of RateSetter having a far more complicated system for re-investment in the very early days, where each individual loan could have its own re-investment order for its repayments... and when the current simplified system came into being, it had the effect of changing the rates of all existing reinvestment orders simultaneously.
The only thing that seems a bit weird to me is that I have to specify my reinvestment settings twice - once for each market for which I have outstanding loans... but presumably there are some customers who specifically want that.
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pikestaff
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Post by pikestaff on Sept 27, 2017 20:57:02 GMT
The only thing that seems a bit weird to me is that I have to specify my reinvestment settings twice - once for each market for which I have outstanding loans... but presumably there are some customers who specifically want that. You set the reinvestment settings once for each market in whch you are invested. That does not seem at all weird to me. It means that you can keep your 5 year money in 5 year and your rolling money in rolling (which is what I do), or whatever.
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sl75
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Post by sl75 on Sept 27, 2017 21:14:25 GMT
The only thing that seems a bit weird to me is that I have to specify my reinvestment settings twice - once for each market for which I have outstanding loans... but presumably there are some customers who specifically want that. You set the reinvestment settings once for each market in whch you are invested. That does not seem at all weird to me. It means that you can keep your 5 year money in 5 year and your rolling money in rolling (which is what I do), or whatever. However, once I've set them all to re-invest to the same market, then whenever I change the interest rate, I need to do it multiple times... and also acknowledge boxes nagging me that I'm re-investing into a longer market (as though I didn't know from the last 20 times it told me...). Minor niggles but still a bit weird for someone who simply wants a "re-invest all unallocated funds into market X at rate Y" function. I did acknowledge that there are other people who want to do different things with unallocated funds depending on where it last came from though... and as you rightly point out, this is more likely for those who use the "rolling" market. Personally, I cannot think of any circumstance in which I would want to do anything different with the funds being returned from the 1, 3 and 5 year loans though.... YMMV.
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Stonk
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Post by Stonk on Sept 28, 2017 8:31:20 GMT
I do different things with payments from different markets.
The big difference between the two markets is that when a Rolling loan pays, I receive one large payment (for the way I invest, typically £250 to £1000), whereas the monthly payments from 5 year loans are much smaller (typically I receive between £1 and £15 a day).
I am happy for the larger Rolling payments to be offered straight back, either on to the Rolling market or the 5 Year market if it looks like rates might be good.
However, I do not want hundreds of long-lasting loans for fiddly little amounts (e.g., I have a 23-month loan for 88 pence paying a grand total of 6p interest), which incidentally always seem to incur rounding errors in RS's favour, so I collect the 5 Year payments in my holding account until it reaches £250 or so.
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Post by investor1925 on Sept 28, 2017 12:26:41 GMT
Beeje13 ..not exactly If you placed £2k in 5yr three years ago, every month some capital and some interest is raised. The default setting is to reinvest back in 5yr If two years later you change reinvestment setting to reinvest "all" in "rolling" Does this new instruction apply to future funds generated from the initial 2k deposit (or are all reinvestment instructions associated with the £2k deposit "fixed" from the point deposit made) Are these the "existing reinvestment orders", which RS says these can't be changed. ...it doesn't sound unreasonable to remove paid up capital and interest from 5 year contract Maybe I need to investigate the withdrawal feature. My aim is to reduce amount in 5yr without incurring fees - I do appreciate pulling out interest and repayments will still leave the account open for 5 years - but over time the exposure to risk will be less. The reinvestment settings are less complicated than you are imagining! An "order" is an offer to lend money (i.e., a specified amount at a specified rate) which has not yet matched. Orders arise either (a) when you enter them manually, offering money from your holding account; or (b) as a result of your reinvestment settings being applied to a payment/payments that has just been recieved. The two scenarios result in orders that are fundamentally the same, it's just that type (b) orders -- "reinvestment orders" -- have been automatically created for you and often you might not even be aware it happened (especially if they matched quickly). It sounds like you might be mixing up the concepts of "reinvestment order" and "reinvestment instruction"; the latter are rules about how to create reinvestment orders. You are free to change your reinvestment instruction, and it *will* affect all reinvestment orders created from that time forward. The warning about "existing reinvestment orders" is simply saying that if you have unmatched reinvestment orders on the market resulting from payments in the past, then changing your reinvestment instruction will not change those orders. Let's say that two weeks ago your instruction was to reinvest in the 5 Year market at 7%, and you received a payment of £100. An order is created for £100 at 7%. Suppose that order hasn't matched yet - then this is an "existing reinvestment order". If you now change your reinvestment instruction to be Rolling at 4%, the 5 Year / £100 / 7% order will continue to exist, unchanged. In two weeks time when you receive the next £100, it will be offered on Rolling at 4%. Clear as mud? Anyway, your aim of progressively reducing the amount you have invested in the 5 Year market without incurring fees WILL be achieved by diverting repayments (principle and interest) onto the Rolling market, which WILL be achieved by making the changes you propose to your reinvestment instruction. Hello Befuddled. This answer from Stonk is spot on. I've been doing what you want to do for a number of months now. Each repayment is re-invested on the rolling market & the outstanding longer term load is reducing as the payments come in.
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Post by befuddled on Sept 28, 2017 14:35:26 GMT
Thanks all, it's reassuring when everyone has same answer....
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