spyrogyra
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Post by spyrogyra on Nov 26, 2013 23:02:52 GMT
Another borrower has failed to sign the loan agreement. 4014 - "The borrower has rejected the loan as, following improved trading in the run up to Xmas, they are no longer in need of the funds. Thanks, FC." "Thank you" doesn't buy a pint. Pathetic! It could be funny if it wasn't sad! As clever as FC can be, surely they can think of something to restrain borrowers from such irresponsible behaviour. But if FC is charging non-refundable, upfront fees for allowing borrowers on the platform (a reasonable thing to do!), it would be fair if lenders get a slice in such cases. Currently it seems like both the borrower and FC do not show respect to our money. Eventually the money will grow wings and fly away.
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mikeb
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Post by mikeb on Nov 27, 2013 18:23:21 GMT
There's been a few of those recently -- I notice when FC are shouting about how "there are 60+ loans available to bid on" they don't mention the count that will turn out to be timewasters/just testing the system/changed mind/rate too high category loans.
I also fear that the current apparent high-rates due to large loan volumes and shortage of available cash (compared to recent history) will mean that the borrowers will go into shock when they see the rates being offered.
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jimbo
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Post by jimbo on Nov 28, 2013 8:05:16 GMT
There's been a few of those recently -- I notice when FC are shouting about how "there are 60+ loans available to bid on" they don't mention the count that will turn out to be timewasters/just testing the system/changed mind/rate too high category loans. I also fear that the current apparent high-rates due to large loan volumes and shortage of available cash (compared to recent history) will mean that the borrowers will go into shock when they see the rates being offered. I've been winning a lot of the higher rate loan parts, and most are going to pre-agreement shortly after the auction ends. I reckon most will probably end up accepting (some already have). There's always a risk that some won't, but it's been pretty well documented on websites such as reviewcentre just how much more convenient/quick raising loan finance through Funding Circle is compared to jumping through the hoops required to obtain a bank loan.
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Post by bracknellboy on Nov 28, 2013 8:28:07 GMT
Auctions are 7 days long. I thought drawdown had to be within 7 days, if not its not too far off that period. 14 days to have money tied up in a loan that ends up not proceeding does not seem like a particularly high load to bear.
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Post by businessbuddy on Nov 28, 2013 12:34:45 GMT
Auctions are 7 days long. I thought drawdown had to be within 7 days, if not its not too far off that period. 14 days to have money tied up in a loan that ends up not proceeding does not seem like a particularly high load to bear. ...unless of course, the next borrower withdraws their application, then the next one. Which results in a sum of lender money never earning any interest, or only earning for a proportion of the time. This reduces the total % earned over the year from what could be reasonable  to average  or even worse......high-street rates !!! 
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pikestaff
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Post by pikestaff on Nov 28, 2013 14:10:29 GMT
I've not kept statistics but it feels to me like 5-10% are failing to complete at the moment. Averaged out over all loans, this adds less than a day to the dead time and is not such a big deal.
The risk of non-completion is a much bigger deal on platforms such as Assetz where the dead time is longer.
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TFTO
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Post by TFTO on Nov 28, 2013 14:12:17 GMT
And there is always the secondary market if you want to start earning straight away.
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pikestaff
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Post by pikestaff on Nov 28, 2013 14:45:35 GMT
I've been winning a lot of the higher rate loan parts, and most are going to pre-agreement shortly after the auction ends. I reckon most will probably end up accepting (some already have). There's always a risk that some won't, but it's been pretty well documented on websites such as reviewcentre just how much more convenient/quick raising loan finance through Funding Circle is compared to jumping through the hoops required to obtain a bank loan. 4094 which finished yesterday at 4:57 has been rejected. Per FC they are going to re-list with a different term (48 months). Feels like a ploy to me. I reckon they did not like the rate , and FC have waived or reduced the fee for re-listing.
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oldgrumpy
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Post by oldgrumpy on Nov 28, 2013 15:05:47 GMT
Well let's hope the new rate is higher than the one they rejected. I think many bidders refuse to come in a second time. At least, they didn't leave it another week before rejecting. I had a few bids in. PS I wonder if 4130 will go the same way.... and as for 4138* I actually won't blame them!   Then there's 4128 ... I bet they were expecting 7.5% or close. I wonder if FC actually tell them at the start that as there are so many large loans being listed currently they stand little chance of achieving anywhere near base rate for their risk band. * Interesting what Cactus(and the borrower) say on Q & A and FC haven't "moderated" it .... yet. Edit: So here it is; 4094>>>4213, snuggling comfortably together in a bunch of six figure requests!! I don't know at what actual rate they finished before; (my bids were 9.8/9.9%), but I bet it'll be 0.5% higher this time, and they've told FC they will accept. |
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spyrogyra
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Post by spyrogyra on Nov 28, 2013 18:31:28 GMT
Talking of ploys... I suspect various! I don't think borrowers are informed when the auction will start. I suspect there are applications gathering dust for weeks and then pulled out and put on the platform without any updates. If that's the case, the silly explanations why loans haven't been accepted look more acceptable. I think lenders would be grateful if FC discloses in public ALL terms and conditions applying to borrowers - including what fees FC is collecting in case of a rejected loan AFTER an agreed auction has finished. And don't they think that part of this fees should go to the lenders as a compensation for the money being tied for weeks. If, on ther side, FC do not receive any fees in cases of rejected loans, then lenders would know they are in one and the same boat. Clarity should be a distinctive feature of P2P lending.
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Post by lynnanthony on Nov 29, 2013 2:58:05 GMT
Talking of ploys... I suspect various! I don't think borrowers are informed when the auction will start. I suspect there are applications gathering dust for weeks and then pulled out and put on the platform without any updates. If that's the case, the silly explanations why loans haven't been accepted look more acceptable. I think lenders would be grateful if FC discloses in public ALL terms and conditions applying to borrowers - including what fees FC is collecting in case of a rejected loan AFTER an agreed auction has finished. And don't they think that part of this fees should go to the lenders as a compensation for the money being tied for weeks. If, on ther side, FC do not receive any fees in cases of rejected loans, then lenders would know they are in one and the same boat. Clarity should be a distinctive feature of P2P lending. On FC's website, under cost of finance (https://www.fundingcircle.com/businesses/cost-of-finance), it says "Only pay an arrangement fee if you accept your loan. There is only one fee to pay – no hidden charges or extras." Is there any reason to doubt that?
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pikestaff
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Post by pikestaff on Nov 29, 2013 7:17:53 GMT
None at all, you are right. Do you know how sponsors are paid, where there is one? Is it out of FC's fee or is it a separate arrangement between sponsor and borrower?
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pikestaff
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Post by pikestaff on Nov 29, 2013 9:28:33 GMT
Some results from yesterday:
4128 £150k (A) Av 9.3% Top 10.4%
4129 £100k (C) Av 11.0% Top 11.8%
4130 £150k (A) Av 8.7% Top 9.5%
Mad scramble on all of them at the end. Will these high rates be accepted?
Meanwhile there are a few more today that look set to finish very high, especially 4138 £150k (C) which has only just filled...
Edit: 4130 has accepted already. Bingo!
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oldgrumpy
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Post by oldgrumpy on Nov 29, 2013 13:11:48 GMT
4138 has already accepted within minutes and drawn down and its already on the secondary market at up to 13%. The guy answering questions seemed straightforward to me, yet I'm still nervous when they grab so quickly .... I bid safe this time and ended up with a bit more than I wanted ... now shall I wait twenty-eight days and then ..... (No. Not a flipper. I'm quite a small old grumpy ... low three figures not tens of thousands in £20 lumps)
edit: I really don't want this kind of thing to be a feature of Assetz in the future.
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spyrogyra
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Post by spyrogyra on Nov 29, 2013 17:21:30 GMT
Thank you lynnanthony for the link and for the information. It is very reassuring that lenders and Fc are in one and the same boat. I hope FC would look and find a legal way to make perspective borrowers behave more responsibly when they submit applications and pay if they reject a loan for no good reason. Thus, Fc underwritters and the rest of the team wouldn't have wasted their time and lenders wouldn't have thier money tied up to two weeks.
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to average 
or even worse......high-street rates !!! 
