|
|
Post by captainb on Mar 19, 2018 15:43:56 GMT
Defaulted loans are so common now l.m beginning to feel like l,m supporting a charity and not investing expecting a profit. The recoveries of 91p over losses of over £100 is also a joke. I,ll be lucky to break even at the year end. Very disappointed.
|
|
|
|
Post by df on Mar 19, 2018 16:06:07 GMT
Defaulted loans are so common now l.m beginning to feel like l,m supporting a charity and not investing expecting a profit. The recoveries of 91p over losses of over £100 is also a joke. I,ll be lucky to break even at the year end. Very disappointed. There are more defaults than a year ago, but I'm still earning some interest. In the past 4 months my annualised return varies between 7.1% and 7.4%.
|
|
dorset
Member of DD Central
Posts: 281 
Likes: 187
|
Post by dorset on Mar 19, 2018 17:23:21 GMT
I've had 15 defaults so far in 2018 as against 12 at this point in 2017 and 7 in 2016. Total loans at 1600+ about the same over the three year period. Total defaults since starting with FC stand at 189 with recovery to date at 37.36%. Net returns fairly constant at about 8.25%. Diversification the only way to manage risk given lamentable FC DD. Currently running out FC investment.
|
|
|
|
Post by grahamreeds on Mar 19, 2018 18:07:59 GMT
I have 6.3% annual. My losses have increased substantially since I have been unable to curate my collection. My ISA has a  one in it: 0 payments and now downgraded due to 'a large CCJ registered' against them. I was hoping that the ISA would have slightly better DD. |
|
|
|
Post by Badly Drawn Stickman on Mar 19, 2018 18:34:32 GMT
I have 6.3% annual. My losses have increased substantially since I have been unable to curate my collection. My ISA has a one in it: 0 payments and now downgraded due to 'a large CCJ registered' against them. I was hoping that the ISA would have slightly better DD. Why would the ISA have better DD? They are exactly the same loans.
|
|
blender
Member of DD Central
Posts: 5,719
Likes: 4,272
|
Post by blender on Mar 19, 2018 18:53:01 GMT
I have 6.3% annual. My losses have increased substantially since I have been unable to curate my collection. My ISA has a one in it: 0 payments and now downgraded due to 'a large CCJ registered' against them. I was hoping that the ISA would have slightly better DD. Why would the ISA have better DD? They are exactly the same loans. Because there is no tax relief for the failures. When I open my ISA in a few weeks, I will expect FC to put the loans which are going to fail in my 'classic' account. I am also expecting that, over the next few months, as FC approaches the IPO, that they will improve their DD generally so that the loan book does not get inflated with loans which might not last the term, for the benefit of the new shareholders.
|
|
|
|
Post by Badly Drawn Stickman on Mar 19, 2018 19:21:58 GMT
Why would the ISA have better DD? They are exactly the same loans. Because there is no tax relief for the failures. When I open my ISA in a few weeks, I will expect FC to put the loans which are going to fail in my 'classic' account. I am also expecting that, over the next few months, as FC approaches the IPO, that they will improve their DD generally so that the loan book does not get inflated with loans which might not last the term, for the benefit of the new shareholders.
Perfectly reasonable expectations. I was tempted to go for a more compassionate response in my original reply, along the lines of..... Often loans that are downgraded like this go on to repay perfectly well....... I just felt it might be a hard sell.
|
|
|
|
Post by captainb on Mar 19, 2018 19:57:27 GMT
I've had 15 defaults so far in 2018 as against 12 at this point in 2017 and 7 in 2016. Total loans at 1600+ about the same over the three year period. Total defaults since starting with FC stand at 189 with recovery to date at 37.36%. Net returns fairly constant at about 8.25%. Diversification the only way to manage risk given lamentable FC DD. Currently running out FC investment. Thank You for your input
|
|
|
|
Post by captainb on Mar 19, 2018 19:58:58 GMT
Defaulted loans are so common now l.m beginning to feel like l,m supporting a charity and not investing expecting a profit. The recoveries of 91p over losses of over £100 is also a joke. I,ll be lucky to break even at the year end. Very disappointed. There are more defaults than a year ago, but I'm still earning some interest. In the past 4 months my annualised return varies between 7.1% and 7.4%. Is that what you have worked out or the stated interest. Mine appears to be lower than the declared
|
|
blender
Member of DD Central
Posts: 5,719
Likes: 4,272
|
Post by blender on Mar 19, 2018 22:32:59 GMT
Dorset is right that you have to go for high diversity and take the statistics with new 'fairer' FC. Best not to look at the loans. I looked at a loan which was a couple of weeks late with its second payment. I re-started my account in Jan, just a few days before this borrower was passed by the sorting hat as E, and FC gave them £100 of my cash. Quite an impressive name for a building co., but odd that 'we' turnover under £50k. Negative profits, negative net worth, though the filed accounts are as old as they could be. A little investigation shows that this is a Lithuanian plumber with a recent limited co. He expects that some customers will pay their bills late in Jan, and so needs some working capital - about 25% of his annual turnover which he will repay over five years! Computer says yes! I say Nooooooooooooooo! He may pay up tomorrow, yes?
Edit. He didn't. And two more loans downgraded because of CCJs. Now of my crop of over 400 loans from Jan onwards. Six late and two more shortly to join them. Plus three downgraded but still live.
|
|
markr
Member of DD Central
Posts: 766
Likes: 426
|
Post by markr on Mar 22, 2018 22:11:40 GMT
To be fair though, E loans pay 20%+, up there among the highest rates available on P2P. A borrower needs to be pretty desperate (or not intending to pay!) to accept that sort of rate.
FC's expected annual loss rate is 8% after recoveries, which probably means they expect barely half of them to limp along to the end. Given the last chance saloon and dodgy geezers nature of this end of the market, a fair proportion of losses are going to be early failures as well.
|
|
|
|
Post by grahamreeds on Mar 23, 2018 4:15:30 GMT
I have 2 downgraded due CCJ in my ISA one of which hit before the first payment occurred.
|
|
adrian77
Member of DD Central
Posts: 3,920
Likes: 4,145
|
Post by adrian77 on Mar 23, 2018 9:00:28 GMT
How on earth can a borrower get a loan without having the funds to make the first payment
-ridiculous!
If this were not about lenders' money it would be funny!
|
|
blender
Member of DD Central
Posts: 5,719
Likes: 4,272
|
Post by blender on Mar 23, 2018 9:10:54 GMT
To be fair though, E loans pay 20%+, up there among the highest rates available on P2P. A borrower needs to be pretty desperate (or not intending to pay!) to accept that sort of rate. FC's expected annual loss rate is 8% after recoveries, which probably means they expect barely half of them to limp along to the end. Given the last chance saloon and dodgy geezers nature of this end of the market, a fair proportion of losses are going to be early failures as well. Yes, quite so. I am suggesting that, at this end of the market, a computer is insufficient to distinguish between the desperate but honest, and those who are just unable to pay, no intending to pay, or who are preparing to be totally surprised by a CCJ. If they had additional human checks on the E loans coming from the sorting hat - a phone interview or a visit if a large amount, then perhaps the rates could be lower for the desperate. We need a 'conservatively unbalanced' option which excludes the E loans, now that we cannot pick and choose.
|
|
|
|
Post by jackpease on Mar 23, 2018 10:10:15 GMT
I've had 15 defaults so far in 2018 as against 12 at this point in 2017 and 7 in 2016. Total loans at 1600+ about the same over the three year period. Total defaults since starting with FC stand at 189 with recovery to date at 37.36%. Net returns fairly constant at about 8.25%. Diversification the only way to manage risk given lamentable FC DD. Currently running out FC investment. 8.25% seems pretty good to me - surely this suggests FC's DD is 'appropriate' ie screening out enough to avoid the uber-dross but not screening out so many that investors can't earn 8.25%? Any due diligence policy that delivered minimal defaults would probably mean minimal %. Jack P
|
|
one in it: 0 payments and now downgraded due to 'a large CCJ registered' against them. I was hoping that the ISA would have slightly better DD.
