puddleduck
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Post by puddleduck on Dec 12, 2017 13:16:57 GMT
Sorry but you are missing the point. The borrower is NOT repaying early. The borrowing is still in place. What RS are doing are refinancing the funding for the loan and keeping the extra margin to themselves. RS is not the borrower. Or just conjecture. Either way, its negative convexity. Its what you get in this type of lending. If you've just figured this out, and it angers you so much, then yes, it sounds like you are in the wrong kind of lending. I think you miss the point - no one here surprised, or shocked. I can' see anyone angry either. We are just pointing out what is going on. That is sort of the purpose of this forum! It's a pretty poor form to try to shut down discussion with if you don't like it, go elsewhere.
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puddleduck
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Post by puddleduck on Dec 12, 2017 13:17:59 GMT
Sorry but you are missing the point. The borrower is NOT repaying early. The borrowing is still in place. What RS are doing are refinancing the funding for the loan and keeping the extra margin to themselves. RS is not the borrower. Or just conjecture. Either way, its negative convexity. Its what you get in this type of lending. If you've just figured this out, and it angers you so much, then yes, it sounds like you are in the wrong kind of lending. I think you miss the point - no one here surprised, or shocked. I can't see anyone angry either. We are just pointing out what is going on. That is sort of one of the main purposes of this forum! It's a pretty poor form to try to shut down discussion with if you don't like it, go elsewhere.
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Post by Deleted on Dec 12, 2017 13:18:54 GMT
It's a pretty poor form to try to shut down discussion with if you don't like it, go elsewhere. Nonsense. There are posters saying they have taken their money elsewhere because of this. I am actually agreeing with them. If they don't like being refinanced early, and that chance being higher for higher rate loans, then yes, they should find other investments.
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puddleduck
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Post by puddleduck on Dec 12, 2017 13:22:05 GMT
It's a pretty poor form to try to shut down discussion with if you don't like it, go elsewhere. Nonsense. There are posters saying they have taken their money elsewhere because of this. I am actually agreeing with them. If they don't like being refinanced early, at that chance being higher for higher rate loans, then yes, they should find other investments. But that is their choice to make. It's no need to address people as if you were talking to a small rather slow child. We know!
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dorset
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Post by dorset on Dec 12, 2017 13:22:42 GMT
Sorry but you are missing the point. The borrower is NOT repaying early. The borrowing is still in place. What RS are doing are refinancing the funding for the loan and keeping the extra margin to themselves. RS is not the borrower. Or just conjecture. Either way, its negative convexity. Its what you get in this type of lending. If you've just figured this out, and it angers you so much, then yes, it sounds like you are in the wrong kind of lending. Yes I don't disagree but I am not angry just annoyed and a bit sad about what RS is becomming. I have been with RS since the beginning and as of today the rules changed. 18 repayments in one morning is RS manipulating the market. I fully appreciate that as of today I am now in the wrong kind of lending with RS and will of course not be adding any further funds.
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Post by Deleted on Dec 12, 2017 13:23:16 GMT
But that is their choice to make. You are being ridiculous. I have nowhere suggested otherwise. In fact, I am agreeing with their choice 
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Post by skint4achange on Dec 12, 2017 13:26:08 GMT
 Is it safe to come back out yet??
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oldgrumpy
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Post by oldgrumpy on Dec 12, 2017 13:28:49 GMT
Have you checked whether all 18 early repayment parts are actually just one borrower settling his loan?
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Post by skint4achange on Dec 12, 2017 13:33:26 GMT
Have you checked whether all 18 early repayment parts are actually just one borrower settling his loan? How do you do that on RS? I just see a contract and have no idea who the borrower is?
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mark123
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Post by mark123 on Dec 12, 2017 13:53:32 GMT
Do your emails say:
That is the wording I get on early repayments ... it is explicit that the borrower repaid the loan.
If RS use that wording when they are refinancing a loan at a lower rate, it is not lack of transparency, it is dishonesty.
Their selection of that wording implies their business model is to inform lenders when loans are repaid by the borrower. I suggest that you email customer services and ask them to confirm whether or not the loans you are concerned about were repaid by the borrower.
Good luck,
M.
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alender
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Post by alender on Dec 12, 2017 13:55:22 GMT
I have now had most of my 3 year loans of 6% repaid early, the RS game for investors is hold out for a good rate and get repaid early if interest rates fall, accept a lower rate and get stuck especially if interest rates rise or lose a lot of money on early sell out.
Who knows what is going on, as I have said before RS is as clear as mud so therefore if because of this they get blamed for something that is not their fault they only have themselves to blame. IMO RS will do all they can to reduce rates so this is not a surprise.
What seems to be forgotten by some P2P platforms is that it is the lenders money and as such we have the right to known what is going on.
With this, the obvious rate games that RS play, state of PF and many other things I have been moving out of RS when repaid, now down to about 8% of the maximum I had invested. If/when the market is difficult for P2P platforms long term investors have long memories so platforms that take investors for granted in good times will find it very difficult.
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oldgrumpy
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Post by oldgrumpy on Dec 12, 2017 14:04:17 GMT
Have you checked whether all 18 early repayment parts are actually just one borrower settling his loan? How do you do that on RS? I just see a contract and have no idea who the borrower is? You probably can't for sure, but you can look at some figures. Check the start date of each contract repaying that day. Are all dates the same? Check the rates of all 18 loans. Are they all the same? On the email you have two figures; original loan and outstanding capital/interest repaid. To test whether it could the same borrower taking the loan on that day, test the ratio of all 18 cases which should be the same, e.g I had one on 22 Nov, £157.45 lent, £53.07 paid back early, which is 33.7%. if you get disparate results, they are different borrowers, if they are the same, it is one. Probably not conclusive, but it might give some idea.
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mark123
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Post by mark123 on Dec 12, 2017 14:06:43 GMT
There were many posts in quick succession and I notice another thread on this issue, so it is probably a significant concern to the silent majority too.
RS no longer comment on this forum but they presumably read it. If it is not their practice to repay loans early to refinance them at a lower rate, maybe they can end the speculation and build trust by confirming their policy on the blog?
M.
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Post by Deleted on Dec 12, 2017 14:10:22 GMT
You probably can't for sure, but you can look at some figures. Check the start date of each contract repaying that day. Are all dates the same? Theres a lesson I learned early on. Rates spike? Pile in!!! Except... now I'm heavily exposed to the large loan which caused the rates to spike. The PF (allegedly) protects against default risk, so the claim is that you don't have to diversify. But theres nothing to protect against the duration risk of early repayment (or default covered by PF). And lack of diversification has definitely burned me here before. Now, when rates spike (especially in the 1-yr market recently), I only trickle money in. The rates are spiking almost daily, now my exposure is far more evenly spread and any early repayments I get are small and not clustered.
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Post by stevepn on Dec 12, 2017 14:17:24 GMT
Rate setter are obviously running the business and want as miuch for themselves as possible and remember that £23 million recent loss has got to be recouped somehow.
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Is it safe to come back out yet?? 
