BuyBack Guarantee | P2P Independent Forum

SteveT
Member of DD Central

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BuyBack Guarantee Jul 30, 2019 8:51:15 GMT via mobile

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Post by SteveT on Jul 30, 2019 8:51:15 GMT

Jul 29, 2019 18:45:23 GMT optimist said:

Jul 29, 2019 8:09:57 GMT kaya said:

Hey that's a pretty innovative idea. I like it in principle, at least.

However, the blurb says: ''A buyback guarantee is a promise between one lender to another, to buyback the microloan in the event that the loan defaults

The sellers buys the microloan at the premium for the benefit of this reassurance. If the microloan fails into arrears by more then 60 days the lender that sold the microloan will buy it back. This gives the lender purchasing a buyback microloan peace of mind.''

Now either I am very dim or that is Rebs gibberish. Surely it should say: The buyer buys the microloan at a premium for the benefit of this reassurance.

(edit) The main risk may be, if the Rebs platform collapses, the buyback guarantees may not be honoured or enforced

(edit) Note to Rebs: the 'read more' button is not working.

under 'total repayable/interest' some interest figures are showing as negative values.

.

First bit looks like a typo. If the platform collapses then there is no reason the backup company that steps in can't enforce the original agreement which is between seller and buyer and secured against the seller's other loans. Agree that needs confirmation. Can anyone think of anything else that might go wrong?

In the event of platform failure, I doubt the Administrator/ Receiver would have any legal right or duty to become embroiled in inter-lender agreements, let alone wish to. Caveat emptor as usual. There is nothing “completely safe” in the world of P2P.

danraj
Representative of rebuildingsociety.com

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BuyBack Guarantee Jul 30, 2019 21:14:47 GMT df likes this

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Post by danraj on Jul 30, 2019 21:14:47 GMT

kaya Thanks for pointing out the typo. That paragraph has now been updated to read better.

The logic has been implemented to automate the buyback process. There is no 'claims' process. We have performed various simultated tests, and will be monitoing it closely over the next six months as we review the market-testing of this feature, which we intend to be a permanant feature.

The 40% limit exists to ensure that vendors keep sufficient collateral on the platform to honour the guarantees, but have designed it so that this does not need manual intervention. In the event of the wind-down plan, the buyback guarnatees would be honoured, under normal operating circumstances. I don't forsee that an administrator would obstruct this, especially since the process of selling back is fee generative, albeit small.

Thanks for the proofing, please let me know if you notice other inconsitencies or typos.

@greenwood2 we are inviting more HNW lenders to consider using the feature to compound their returns, so we hope to have more BBG loans on the secondary market in the coming weeks.

Last Edit: Jul 30, 2019 21:15:05 GMT by danraj

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df
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BuyBack Guarantee Aug 1, 2019 23:41:27 GMT Ace likes this

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Post by df on Aug 1, 2019 23:41:27 GMT

Jul 28, 2019 21:46:27 GMT Ace said:

Jul 28, 2019 19:04:26 GMT df said:

You can't earn 12% from AC unless you are prepared to risk investing in 593, 547, 546 and 544 for 1 remaining month. Generally speaking the era of 9%+ AC loans is long gone. LW is 6.5% and GS 5.3%.

GS pay 5.8% in their ISA.

And bonuses for increasing investment volume... and referrals.