zlb
Member of DD Central
Posts: 1,418
Likes: 332
|
Post by zlb on Dec 8, 2017 11:37:33 GMT
Hi, sorry if obvious, but having registered with RS a long time ago and then not used, I've gone back to it. I've read a few posts here and am not getting the hang of it. I've read some of their website (e.g. RS "does not split your loans across multiple Borrowers."). So far:
you can't diversify? (this is what the PF is for - larger risk?)
you have to login regularly to manage interest rate offer?
The markets on offer don't quite perform as they might be named to do?
There I was, thinking it was the same as Z, but purple and with some historical lending practice difference.
Thanks for any tips.
|
|
oldgrumpy
Member of DD Central
Posts: 5,087 
Likes: 3,233
|
Post by oldgrumpy on Dec 8, 2017 12:07:26 GMT
The tips are already up on the forum threads. Have a browse through them. Going through it again is just repetuition. (That was a typo, but it's a good new word really  ) Basically if you can't spend time on monitoring rate vagaries during the day, MR is all you have. Just don't do "rate to lend right now". You can lose up to 2%, even on MR. If you can watch the site during the day and learn to interpret what might happen in the following few hours, you can achieve 0.5%-2.5% higher even than MR. edit: one big change RS do not publicise much is that they are lending out a lot of larger amounts on property (presumably secured) in the last year or so. This has not revealed itself by improved lender rates*, particular on the 5 year market which oscillates between 3.5% and 6.5%, but usually around 5%+. On this kind of lending, 6%-12% is easily achievable elsewhere, sometimes including a PF. * unless that is what is fuelling the rolling market which was around 3% but now seems to have sttled around 4% (more available if you invest carefully). |
|
oldgrumpy
Member of DD Central
Posts: 5,087
Likes: 3,233
|
Post by oldgrumpy on Dec 8, 2017 15:21:02 GMT
... for instance, I had my little wedge at 4.1% rolling today and got it, but due to not monitoring the site during the afternoon I missed out on 5.8% on 1 year - which I would have swopped to.  Can't win-em-all.  |
|
|
|
Post by newlender on Dec 9, 2017 7:00:59 GMT
I would say that the regular monitoring of rates is the most important factor and if you can't do that it's probably not for you. And if you invest in the 1yr you might get loans of 12 months, or of 3 weeks as I got recently. Remember that these are not microloans and so early repayment is of the entire sum invested. You get an email to warn you so you need to monitor that too. On the plus side, I've always managed to sell loans quickly when needed but that might change.
|
|
|
|
Post by skint4achange on Dec 11, 2017 16:32:08 GMT
... for instance, I had my little wedge at 4.1% rolling today and got it, but due to not monitoring the site during the afternoon I missed out on 5.8% on 1 year - which I would have swopped to. Can't win-em-all. Damn Grumps, I should have told you earlier!!
|
|
zlb
Member of DD Central
Posts: 1,418
Likes: 332
|
Post by zlb on Dec 11, 2017 21:19:01 GMT
Hi, sorry if obvious, but having registered with RS a long time ago and then not used, I've gone back to it. I've read a few posts here and am not getting the hang of it. I've read some of their website (e.g. RS "does not split your loans across multiple Borrowers."). So far: you can't diversify? (this is what the PF is for - larger risk?) you have to login regularly to manage interest rate offer? The markets on offer don't quite perform as they might be named to do? There I was, thinking it was the same as Z, but purple and with some historical lending practice difference. Thanks for any tips. Thanks. I did try reading the forum. There was a large gap between my expectation when I registered with them a long time ago, and then reading the forum, hence questions. I realise the clue is in the name.what's the worst case scenario on not monitoring for Eg three days? 2%?
|
|
smezz
Posts: 180
Likes: 73
|
Post by smezz on Dec 11, 2017 23:05:26 GMT
If you set your own reinvestment rate or set your reinvestment instruction to 'holding' you will never get stuck with 2%.
|
|
|
|
Post by skint4achange on Dec 12, 2017 9:34:34 GMT
It really is a difficult question to answer from zlb
The reason I say this is because the way this should work is that you set your rate at the level the YOU are happy to lend at. It matters not what the market is doing before or after your money is matched.
The problem comes when you have your money matched but then you hear of people who have just got 0.3% higher than you did by waiting for 15 minutes. But, unless you are investing £xxx,xxx's in the market, is 0.3% really going to make that much difference over the 1 year? No. On £100,000, the lost interest is £300. If your money sat around for 20 days waiting for a 6% match that would result in a £300 loss too.
The trouble occurs when lots of people who do not check their accounts very often allow their money to just roll back into the market using Auto reinvest. There is nothing wrong with using the Auto Reinvest settings but these people have not watched the markets for some time and have just chosen a silly % such as 2.0%. As RS release the repayments into these accounts, the rate is driven down after reaching a peak. From my watching of FS (This is not an exact science by the way!) the repayments seem to be made around 8/9am, 2pm and again around 6pm.
Another problem is that people see the rates going higher and then reduce their reinvestment settings to create a match before the bubble bursts. Again, nothing wrong with that but it kind of plays into the hands of RS who love low interest rates. It makes others panic too and causes an avalanche of funds to tumble into the lower APR areas as people flinch.
The final APR issue, a short while ago the markets were being crossed. This meant that on certain times on certain days, the rate on offer was higher than the available investor funds at the bottom. You could effectively jump the queue and get a better rate while some investors using Auto Reinvest were not being matched. For example, I have a match at 6.2% on the 1 year and there were investors sitting with funds waiting for matches at 5.7%, 5.8% etc. While this is not a problem for those who get the rate, it does cause some problems for those who find out about it and did not have their money matched because someone jumped them. This made some people question what use Auto Reinvest was? I would have agreed with them if I hadn't been watching the markets and got the rate. Maybe I will get burnt next time.
On the subject of diversity, RS say you do not have to diversify because they have the Provisional fund which covers any loses incurred (Which you never see because the investor system is blind). This should negate the need for diversification.
I have not experienced issues where the market has not operated as it "says on the tin" but others have. All I do now is once the loan has formed is to check the loan details and see when the loan matures and put an entry on my planner to check back when the loan is repaid to see what the rates have been/are doing at that time. No use worrying about the rates when you have nothing to invest.
In short, I would look at the rate you are happy with (Doesn't have to be the lowest APR, you can have a rate you would be happy with and a rate you would be delirious with and split the difference) and leave the settings at that. Or, you can put it on the high end of the market and hope there is a match while you are not looking. Myself, I have money on the market at 4 or 5 different % rates. This allows for me to get an early notification if the lower % money gets matched while at the same time having a chance at a higher match if this is just a short sharp peak. By the way, the lowest APR I set is the lowest I would be happy with.
Good luck
|
|
zlb
Member of DD Central
Posts: 1,418
Likes: 332
|
Post by zlb on Dec 12, 2017 16:31:26 GMT
It really is a difficult question to answer from zlb
The reason I say this is because the way this should work is that you set your rate at the level the YOU are happy to lend at. It matters not what the market is doing before or after your money is matched.
The problem comes when you have your money matched but then you hear of people who have just got 0.3% higher than you did by waiting for 15 minutes. But, unless you are investing £xxx,xxx's in the market, is 0.3% really going to make that much difference over the 1 year? No. On £100,000, the lost interest is £300. If your money sat around for 20 days waiting for a 6% match 19 days that would result in a £300 loss too.
The trouble occurs when lots of people who do not check their accounts very often allow their money to just roll back into the market using Auto reinvest. There is nothing wrong with using the Auto Reinvest settings but these people have not watched the markets for some time and have just chosen a silly % such as 2.0%. As RS release the repayments into these accounts, the rate is driven down after reaching a peak. From my watching of FS (This is not an exact science by the way!) the repayments seem to be made around 8/9am, 2pm and again around 6pm.
Another problem is that people see the rates going higher and then reduce their reinvestment settings to create a match before the bubble bursts. Again, nothing wrong with that but it kind of plays into the hands of RS who love low interest rates. It makes others panic too and causes an avalanche of funds to tumble into the lower APR areas as people flinch.
The final APR issue, a short while ago the markets were being crossed. This meant that on certain times on certain days, the rate on offer was higher than the available investor funds at the bottom. You could effectively jump the queue and get a better rate while some investors using Auto Reinvest were not being matched. For example, I have a match at 6.2% on the 1 year and there were investors sitting with funds waiting for matches at 5.7%, 5.8% etc. While this is not a problem for those who get the rate, it does cause some problems for those who find out about it and did not have their money matched because someone jumped them. This made some people question what use Auto Reinvest was? I would have agreed with them if I hadn't been watching the markets and got the rate. Maybe I will get burnt next time.
On the subject of diversity, RS say you do not have to diversify because they have the Provisional fund which covers any loses incurred (Which you never see because the investor system is blind). This should negate the need for diversification.
I have not experienced issues where the market has not operated as it "says on the tin" but others have. All I do now is once the loan has formed is to check the loan details and see when the loan matures and put an entry on my planner to check back when the loan is repaid to see what the rates have been/are doing at that time. No use worrying about the rates when you have nothing to invest.
In short, I would look at the rate you are happy with (Doesn't have to be the lowest APR, you can have a rate you would be happy with and a rate you would be delirious with and split the difference) and leave the settings at that. Or, you can put it on the high end of the market and hope there is a match while you are not looking. Myself, I have money on the market at 4 or 5 different % rates. This allows for me to get an early notification if the lower % money gets matched while at the same time having a chance at a higher match if this is just a short sharp peak. By the way, the lowest APR I set is the lowest I would be happy with.
Good luck Thank you, lots. Very helpful, hope also to others. Plus, I'm glad you think it a difficult question.
|
|
)
