£3.4m WInd Turbine Portfolio Loan

That seems to me an arbitrary rule made up on the spot as an attempt to rebalance what started out as an unfair situation (only a small select group being able to make the primary investment), and which itself will result in other unfairnesses, etc... e.g. why exactly half, and why exactly 90 days?

The fairest solution seems to me to have:
- all users having the ABILITY to stump up hard cash pre-drawdown (underwriters would have an OBLIGATION to do so in exchange for which I assume they receive a fee, regardless of whether that obligation is actually called upon in full or not).
- anyone who has actually contributed cash towards the loan being allocated loan units with no further strings attached - they can sell them in the aftermarket as and when they choose to do so, or retain them for the life of the loan.

Why demand a complex solution with lots of extra arbitrary rules, when a possible simple solution is staring us in the face?


Regarding the specific loan that this thread is supposed to be about, it was available for bidding by retail investors pre-drawdown. I got a small slice myself. I'd see anyone who chose not to acquire it at the first opportunity as having no moral right to demand that there be a further opportunity to acquire it on any particular timescale, and especially not if they themselves had a shadow bidding facility so did not need to provide the cash until the same time as the underwriter(s) would have done. In fact I've sold a couple of small chunks from my own holding. The first was split only 6 ways (but I think this was immediately after drawdown, so may have been a many-to-many match). The second was a reduction of £20, and got split 20 ways in £1 chunks.

I didn't notice any suggestions of conspiracy.  The issue was discussed in this thread because it's a huge loan and people were expecting large chunks of it to appear on the Aftermarket shortly after drawdown so they were surprised when that didn't happen.  AndrewH has explained that the bulk of this loan was underwritten by a single investor, so that should have made it clear that the issue isn't one of conspiracy.

I was unaware of any bias in the purchase scheme towards small lenders, giving them priority in any way.  If the current holder of the bulk of this loan were to put their entire 'underwriter' holding onto the Aftermarket, I expect they could buy most of it back into their 'investment' account before small investors could react in significant numbers.  Having said that though, if minor restrictions were placed on underwriters' repurchases I don't think it would be particularly upsetting to underwriters.  But that's JMHO and I have no experience with underwriters or underwriting, so it might not be worth much.

I think you're missing a couple of important points...

• Based on prior experience small lenders were led to believe that, particularly because this loan was so big, there was no need to have dead money tied up in bids prior to drawdown.  It was expected that there would be huge amounts of this loan available on the Aftermarket.  It was discussed at the beginning on this thread.  From the first three posts it is clear that the loan was underwritten instantly, and that was before even pre-bids were allowed.  AC follow the forum and if they knew we were totally wrong in our thinking and that the only way to participate in this loan was to bid and have dead money, then I feel they ought to have said something at the time.
• In Post #2, kermie said "I have a hunch this is the way AC will go (no inside information - just a hunch) when the new site launches - i.e., underwriting will be secured before a loan appears...and maybe even the PM will disappear totally and lenders won't be able to purchase until drawdown on the AM."  I suspect he chose his words to be diplomatic, inasmuch as AC had given enough hints about the new system.  So while we're now discussing a loan that came forward before the new system was implemented, the issue is more relevant for the future, when non-underwriters do not have an opportunity to invest before drawdown.  In that case, I believe AC need to put conditions on their underwriters to ensure that they act as underwriters -- facilitating the lending process -- and not as privileged investors who are allowed to cherry-pick and snaffle up all the good opportunities ahead of any investment by non-underwriters.
  

Perhaps the AutoInvest system isn't working perfectly.  I set my target for this loan before it drew down, so I would have expected to pick up a piece of sl75's first sale, but I didn't.  By the time of his second sale there must have been a long list of people with targets above their holdings, because his sale was divided into £1 parts.  I didn't get one of those either.  I did pick up a part late this afternoon.  It was a £1 part, so this suggests that there still are a lot of people trying to increase their holdings of this loan.

Perhaps all that's needed at this point is a polite request from AC to the underwriter who is acting as a privileged investor rather than an underwriter to suggest that they release some of their holding to the Aftermarket.  I suspect it wouldn't take a release of even 10% of their holding to completely satisfy small investor demand and leave parts available on the Aftermarket for future investors.  And that includes GEIA investors.

This thread must be jolting someones conscience. Just pick up another £4 on the am.

They get 9.5% before they sell and 0% after they sell. The most applicable target of the "what's the point" question seems to me "what's the point of selling before they need to?".

If they've no need for the cash yet, there's no reason I can see for them to sell... the new "target" based system would tend to mean that once demand is there it'll stay there (give or take any short-term variations in immediately-available cash from potential buyers).

IMHO if that approach was taken it would be misleading and could/would underestimate the demand.

I have set target levels to figures that my current levels of funding could cover (so a couple of hundred £).  These targets do not necessarily represent the total level that I would want to hold but I don't want all the funds to be sucked instantly into one loan and then miss (potentially) some of the others whilst I wait for new funds to be added (I miss the days of instant funding).  OK I could add 'dead money' to cover the off chance that a large amount of certain loans would be released onto the market but I would prefer to keep it in the RS monthly market making on average 2.6% knowing that the repayments most days would cover my AC requirements.

I suppose the old saying "A Duck in the hand is worth ....." but I doubt if I am the only one who runs their accounts in this way.

Now showing "Investments are currently paused on this loan due to a late repayment".

Pleased I'm not holding £3m of this