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Post by goldservice on Oct 12, 2014 19:04:04 GMT
>8 I don't know specifically about the tranche 8< Kev - do you know how to find out?
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jcb208
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Post by jcb208 on Oct 12, 2014 19:16:31 GMT
Ratesetter now offering £50 referral bonus this month so must be pushing for more investment as well
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Post by p2plender on Oct 12, 2014 19:39:36 GMT
thanks for the replies folks.
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Post by moneyball on Oct 12, 2014 19:57:41 GMT
Just like in early august (which spawned this thread) it appears to be mostly from early repayment/sell out of loans. The amount of new lending has reduced slightly too although this is compared to the recent all time highs.
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Post by geoffrey on Oct 14, 2014 6:54:42 GMT
A large deposit or deposits yesterday evening at 5.9% (well below the going rate for the day, which was 6.1-6.2%) has succeeded in setting today's "market rate" at 5.9%, which then dumps some 2,000 loan offers in at the new market rate of 5.9%. This just underlines once more what poor value the "auto-relend" feature is, IMHO. Also, how a relatively small, ahem "well timed", deposit can be used to produce large shifts in the market rate and move some very large sums of money (nearly half a million in what I assume are mostly today's repayments). I do feel that this mechanism (the timing and percentage of funds that can set the next day's market rate) is not one of RateSetter's most transparent features...
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Post by GSV3MIaC on Oct 14, 2014 7:38:40 GMT
Yep, 'market rate' needs to be set relative to some smoothed, over time, average of what's been offered and accepted, not a 5 second snapshot of the offer pool. Or maybe just increase the 'ignore outliers' to something like 10% or more? Right now we have an amplifier effect. Would be saner to roll dice for it. 8>.
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mike
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Post by mike on Oct 14, 2014 9:14:33 GMT
westonkevRS that deposit of £25K I think it was last night at 5.9% just doesn't make sense. I can't see any reason why someone would try to "game" the system but the impact on rates is plain to see. Comments?
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jo
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Post by jo on Oct 14, 2014 9:46:13 GMT
I guess the drop in the 10 year Gilt yield in the past month from 2.6% to 2.2% today is setting the tone - partly offset by a deterioration in credit.
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pikestaff
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Post by pikestaff on Oct 14, 2014 10:06:02 GMT
Just at the moment there seems to be too much money (£1.8m) chasing too few borrowers. I expect the rate to keep falling until balance is restored.
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Post by pepperpot on Oct 14, 2014 11:00:36 GMT
Also, today's drop in inflation and the news that the long awaited rise in base rate will most likely be pushed back, disappointing those expecting it to start to creep up pre-election. And maybe the Ad campaign is starting to generate new funds, maybe westonkevRS might be able to give an indication of the level of new lender sign-ups? or is that classified info?
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Post by geoffrey on Oct 14, 2014 11:04:48 GMT
Either a very naïve lender, who could have got the same amount (52K or whatever) lent out easily at 6.1%, or else someone was not so pleased that most lenders seemed to have cottoned on to the fact that if they wait it out on 6.2%, their money will go out in a couple of days. Looks like a bit of a glut coming. Probably those RS ads paying off (I saw a full-page one in Money Week that suggested returns of >6%).
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Post by davee39 on Oct 14, 2014 11:18:47 GMT
Why would the lender be naive?
5.9% is an amazingly good deal compared with the rest of the market.
The idea that money could 'easily' be lent out at a higher rate is misleading. I have the option of lending at say 5.9 for immediate lending, or at 6.1%, assuming a steady lending rate, and NO new money at a lower rate, I can estimate my money might be lent out in 4 hours. In reality if new money comes in lower I get pushed further down the queue and eventually give up, joining the back of a lower rate queue. Unfortunately so much new money has come in that I have to drop my rate even further, to 5.8, to get it out fast, and I am now at the back of that queue. So for some people going to the front at a lower rate makes sense. Its called market forces and with RS it not only works, but it provides a textbook example of how it should work.
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Post by westonkevRS on Oct 14, 2014 12:06:25 GMT
westonkevRS that deposit of £25K I think it was last night at 5.9% just doesn't make sense. I can't see any reason why someone would try to "game" the system but the impact on rates is plain to see. Comments? To be honest, I'm not going to investigate the motives of every lender that deposits cash at a rate considered sub-optimal by our more focussed lenders. I personally thing Davee39 has probably nailed it. I'm happy to go 0.1% lower to get my money out the door immediately. And the movement at the moment implies 5.9% a relatively good deal. Other than that, perhaps the advertising, promo offers and (dare I say it here) new web site are driving more deposits. Also as this week is down on last week's record lending with more money chasing less loans will, if the market is functioning, drive down the rates. Kevin.
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Post by yorkshireman on Oct 14, 2014 12:22:01 GMT
5.8 / 5.9% for 5 years?
Might look good now but when the brown stuff hits the fan there will be a reality check on rates and 5.9 won’t look so good.
5%+ for 3 years, now that's a different story.
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Post by davee39 on Oct 14, 2014 13:05:48 GMT
5.8 / 5.9% for 5 years? Might look good now but when the brown stuff hits the fan there will be a reality check on rates and 5.9 won’t look so good. 5%+ for 3 years, now that's a different story. If there was a prize for being an Ultra rate contrarian you would definitely win it! RS and Zopa were unknown quantities in their early days and the brave early adopters were rewarded with extra high rates. They might have lost every penny. After 5 years of emergency low rates we have a BOE Governor who would rather cut off his limbs than see a rates increase and the eurozone headed for a fresh recession due to a massively flawed monetary union. RS is almost 'establishment', much larger, much safer, and not surprisingly offering lower rates. Yes, UKIP might win the next election, sterling might tumble and rates might rise but the chances of returning to a 6% Bank Rate in the next 5 years are less than those of England winning a world cup. Of course if you have lived in a cave the last few years you might still think property is a good bet, but that is one market where the 12% returns might stop looking so clever if they end up as a 30% capital loss.
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