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Post by andrewholgate on Sept 16, 2015 14:38:23 GMT
We've discussed the discounts and it's been decided that the current options will remain. Discounts aren't provided so that lenders can idly jump the queue or circumvent the balancing / prioritisation algorithms that have been put in place to keep the market balanced for the benefit of all lenders. A 1% discount, which as pointed out represents something in the region of 1 month of interest on average, is about right for someone looking for a speedy exit from an otherwise good loan. It's a hurdle but not an overly onerous one which is why we chose that level in the first place. Distressed loans have the option for higher discounts being offered. It should also be remembered that we don't charge lenders any fees for exiting a loan, such as a sale fee or even a fee based on breaching the amount of time you'd agreed to lend the funds. Such fees can greatly affect the cost to lenders. We'll keep this under review but for now the existing figures will remain in place. In the scenario of a loan that has a proposed 12 month interest buffer but that is miscalculated by AC (& only stands at 3 months), then loses it's tenant but the security still offers good cover, is suspended for a prolonged period only to be released again after the borrower continues to service the payments but now lenders find that what was a previously liquid loan has stagnated, small discounts maybe the suitable answer to enable an exit. Lenders are effectively being charged at least 1%for AC decision making (with the exception of losing the tenant) which seems rather unfair. andrewholgate? I'm declining to comment. Discounts will be set by the lenders who wish to exit, we are not forcing you to discount.
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Post by andrewholgate on Sept 16, 2015 14:40:44 GMT
"...Where do you find out the sterling to moth exchange rate?..."
I remember Sterling Moth. He uthed to rathe motor carth when I wath a kid! 
(I'll get me coat...)
I heard gorillas take the pith. Especially before eating.
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Post by Butch Cassidy on Sept 16, 2015 14:42:30 GMT
In the scenario of a loan that has a proposed 12 month interest buffer but that is miscalculated by AC (& only stands at 3 months), then loses it's tenant but the security still offers good cover, is suspended for a prolonged period only to be released again after the borrower continues to service the payments but now lenders find that what was a previously liquid loan has stagnated, small discounts maybe the suitable answer to enable an exit. Lenders are effectively being charged at least 1%for AC decision making (with the exception of losing the tenant) which seems rather unfair. andrewholgate? I'm declining to comment. Discounts will be set by the lenders who wish to exit, we are not forcing you to discount. My point being 0.1, 0.25% would often be sufficient to prompt a buy, in a "good loan" such as this, so why are we being forced to use a MINIMUM 1% or the equivalent of nearly 8% of our yearly income from the loan?
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Post by chris on Sept 16, 2015 15:26:04 GMT
I'm declining to comment. Discounts will be set by the lenders who wish to exit, we are not forcing you to discount. My point being 0.1, 0.25% would often be sufficient to prompt a buy, in a "good loan" such as this, so why are we being forced to use a MINIMUM 1% or the equivalent of nearly 8% of our yearly income from the loan? This has been covered elsewhere, discussed again at board at lender's request, and is set in stone for now. Discounts aren't allowed to let lenders bypass our market and prioritise their sale with little to no cost to the lender. They are designed to allow lenders who wish to exit a loan to expedite that sale but at a minimum cost to prevent it being used casually and turned into a game as lenders try and "beat the system".
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 11,330 
Likes: 11,549
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Post by ilmoro on Sept 16, 2015 16:29:39 GMT
andrewholgate judging from the multiple Qs in the Leeds Q&A there seems to be a lot of confusion as to what is happening with the loans with 'monitoring' events under the new system. Do you think these loans should have the trading suspended tag applied on the loans list? I note there is a blue explanation on actual loan page (not sure when this appeared) but doesnt seem to be clear enough. The pink bar at the top is also contradictory saying suspended and not suspended. Also surprised no one has managed to answer any of the simple questions asked in 2 days.
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sl75
Posts: 2,092
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Post by sl75 on Sept 16, 2015 18:50:25 GMT
This has been covered elsewhere, discussed again at board at lender's request, and is set in stone for now. Discounts aren't allowed to let lenders bypass our market and prioritise their sale with little to no cost to the lender. They are designed to allow lenders who wish to exit a loan to expedite that sale but at a minimum cost to prevent it being used casually and turned into a game as lenders try and "beat the system". Thinking out loud... what if AC were to introduce a fee for selling at a price other than par (passing on the cost of development and maintenance of this facility together with all the associated record-keeping, auditing, etc.) to those who are making use of the service. If this fee were pitched at 0.5%, with discounts of all multiples of 0.5% selectable: - the cost to the seller of a minimum possible discount would still be 1% - it avoids lenders "beating the system" by buying at (say) 1.5% or more and selling at 1.0% (as the profit they'd otherwise have made when doing this in high volume is absorbed by the fee). Other fee amounts and tick sizes could be possible. However, without a fee, it seems highly anomalous that 1%, 1.5% and 2% can be selected but 0.5% cannot - it simply seems to have been accidentally missed out of the list. Alternatively, if AC are indeed convinced that 1% is an appropriate minimum discount to enforce when undercutting those who are selling at par, surely the exact same argument applies for not allowing the 1% discount to be undercut by only 0.5% - the next selectable option should surely be 2%!
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bigfoot12
Member of DD Central
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Post by bigfoot12 on Sept 16, 2015 19:15:43 GMT
- it avoids lenders "beating the system" by buying at (say) 1.5% or more and selling at 1.0% (as the profit they'd otherwise have made when doing this in high volume is absorbed by the fee). However, without a fee, it seems highly anomalous that 1%, 1.5% and 2% can be selected but 0.5% cannot - it simply seems to have been accidentally missed out of the list. Alternatively, if AC are indeed convinced that 1% is an appropriate minimum discount to enforce when undercutting those who are selling at par, surely the exact same argument applies for not allowing the 1% discount to be undercut by only 0.5% - the next selectable option should surely be 2%! I don't understand, what is "beating the system"? If you are desperate to sell now, you might have to drop your price, if you wait you might get a better price. The guy buying at a 1.5% discount might be selling at a 40% discount if things go wrong. Having someone watching out for a good discount, buying and then trying to sell at a reduced discount is good for the rest of us. We can all put buy at 1% discount bids in if we think 1.5% discount is too much. AC don't want us to undercut the investment accounts which can sell only at par. This is the special feature of 0%, so 0.5% is not okay, but 1.5% is.
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sl75
Posts: 2,092
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Post by sl75 on Sept 16, 2015 19:29:12 GMT
I don't understand, what is "beating the system"? In the sense chris just used it, I assumed he meant gaining a possibly significant advantage over more casual investors by playing various strategy games. One such game is to buy discounted loan units and resell them at a price even as little as one tick higher - made possible in part due to AC not passing on the costs associated with trading to those performing that activity.
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Post by Butch Cassidy on Sept 16, 2015 19:44:38 GMT
My point being 0.1, 0.25% would often be sufficient to prompt a buy, in a "good loan" such as this, so why are we being forced to use a MINIMUM 1% or the equivalent of nearly 8% of our yearly income from the loan? This has been covered elsewhere, discussed again at board at lender's request, and is set in stone for now. Discounts aren't allowed to let lenders bypass our market and prioritise their sale with little to no cost to the lender. They are designed to allow lenders who wish to exit a loan to expedite that sale but at a minimum cost to prevent it being used casually and turned into a game as lenders try and "beat the system". Why have a transparent, open & honest free market when you can enforce a rigged, biased & opaque one that treats some favoured lenders in a more beneficial way than other less valued lenders. In fact why not extend that principle across the platform?
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Post by chris on Sept 16, 2015 20:26:36 GMT
This has been covered elsewhere, discussed again at board at lender's request, and is set in stone for now. Discounts aren't allowed to let lenders bypass our market and prioritise their sale with little to no cost to the lender. They are designed to allow lenders who wish to exit a loan to expedite that sale but at a minimum cost to prevent it being used casually and turned into a game as lenders try and "beat the system". Why have a transparent, open & honest free market when you can enforce a rigged, biased & opaque one that treats some favoured lenders in a more beneficial way than other less valued lenders. In fact why not extend that principle across the platform? How is putting a 1% hurdle on discounted loan part sales not transparent, open or honest? For that matter how many platforms are there that even allow lenders to discount loan units that don't charge lenders a penny for using the platform?
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Post by Butch Cassidy on Sept 17, 2015 7:09:33 GMT
Why have a transparent, open & honest free market when you can enforce a rigged, biased & opaque one that treats some favoured lenders in a more beneficial way than other less valued lenders. In fact why not extend that principle across the platform? How is putting a 1% hurdle on discounted loan part sales not transparent, open or honest? For that matter how many platforms are there that even allow lenders to discount loan units that don't charge lenders a penny for using the platform? AC was supposed to price loans for the risk so effectively the rate represented the correct level of return for the risk the lender took, naturally selling at par maintained this equitable transfer of risk upon sale. Discounts were used to stimulate demand, mainly by underwriters who wished to exit their position quicker than the market demand allowed (which was fine as the u/w fee had already compensated them for this) it also allowed lenders a last resort way to facilitate a swift exit for whatever reason. Allowing premiums to be charged (which is also what is being proposed I understand) distorts this model effectively under pricing the risk & over charging the lender; it is pricing for demand - that was the main criticism AC made of the auction model for initially setting loan rates.
“Fairer, Growth, Together.” Means IMO that all lenders should receive fair/equitable treatment & things like loan distribution should not favour one group over another by way of biased algorithms, neither should one group be effectively forced to accept an arbitrary discount figure to achieve a sale, if the market price maybe far less, it is effectively punishing sellers for factors which are outside their control. Par sales have been possible for virtually every loan on the platform, however Leeds for example has seen it’s liquidity crippled, in part due to AC not being able to add up properly, so why should sellers pay an extra 1% penalty if 0.25% would be sufficient?
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Post by andrewholgate on Sept 18, 2015 8:49:49 GMT
andrewholgate judging from the multiple Qs in the Leeds Q&A there seems to be a lot of confusion as to what is happening with the loans with 'monitoring' events under the new system. Do you think these loans should have the trading suspended tag applied on the loans list? I note there is a blue explanation on actual loan page (not sure when this appeared) but doesnt seem to be clear enough. The pink bar at the top is also contradictory saying suspended and not suspended. Also surprised no one has managed to answer any of the simple questions asked in 2 days. Will look at it.
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bigfoot12
Member of DD Central
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Post by bigfoot12 on Sept 29, 2015 11:14:38 GMT
Thank you for the note feature, much appreciated. Now we just need some more (loan) notes!
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Post by bracknellboy on Oct 12, 2015 19:36:10 GMT
A release has just gone live that includes: - View your queue position in the Quick Access Account. This is accessed by clicking the small menu icon when viewing the account on your Dashboard, and selecting Queue position.
Ok, so I must be really thick or its not on mobile devices. (the former remains a true statement regardless of whether the latter is an issue). Which small menu icon ? Is that the clock face thingy in the top LH corner of the QAA dashboard splash ? If so, it ain't clickable, hoverable or anything else at my end. P.S. Not overly important right now as thanks to the uplift on the cap I now have a grand total of 5p in the Q with all the rest having been swept.
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SteveT
Member of DD Central
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Post by SteveT on Oct 12, 2015 20:02:14 GMT
It's on the "3 little horizontal lines" drop-down menu button, top-right of the QAA window
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