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Post by jasonnewman on Mar 24, 2020 19:48:21 GMT
I believe it is a farce to have Quick Access Accounts at the lower 4.1% interest rate when they are not fit for purpose under the 'new market conditions' which are effectively more risky than when the QAA were established. Why is it that investors are not being rewarded for this additional risk they are taking?
Investors are forced to hold on for longer periods and the QAA cannot withdraw funds quickly.
The 30 / 90 day balance have increased today whereas the QAA balances are pretty much unchanged since 10am today - effectively investors are saying their money is going to be locked for long periods so they will take the higher interest rate instead and rightly so, therefore why is it existing investors are effectively being ripped off with the lower interest rates?
Higher rates will ensure more liquidity when interest is paid but this is going into AC profits instead.
Maybe this is something we should raise with the FCA for how AC is conducting their business - Just doesn't feel right to me. Thoughts?
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sl75
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Post by sl75 on Mar 24, 2020 20:57:11 GMT
QAA should only be converted to 30/90 day account on a lender's explicit instruction - it gives a further 30 or 90 day delay before you even join the withdrawal queue/pool.
There should always have been a button like the one on the 30DAA to transfer QAA funds to a longer-term account. I'm not clear on why AC omitted it in the first place, and it doesn't strike me as something that would take more than a few minutes to add (at least on the development branch - of course it would need to be tested before pushing to the live site!)
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Post by Ace on Mar 24, 2020 20:58:39 GMT
AC have said that they are already looking at allowing funds in shorter notice accounts to move to longer notice accounts. They are also looking at allowing them to be moved to the MLA so that the lender can benefit from the full interest and can sell at a discount if they choose.
AC don't pocket the difference between the notice account rate and the full loan rate. The difference is paid to the PF, to the protection of all lenders in that account.
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sl75
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Post by sl75 on Mar 24, 2020 21:02:10 GMT
AC don't pocket the difference between the notice account rate and the full loan rate. The difference is paid to the PF, to the protection of all lenders in that account. That's an incomplete description...
Any time the PF has a "surplus" AC can and do draw off the excess, and this is very much part of their profit margin/spread whenever it is positive.
It remains open whether AC will be accused of some form of wrongdoing if at some further time the PF proves insufficient such that the amounts AC have drawn off as profit already later turn out not to be a "surplus" or "excess".
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Post by Ace on Mar 24, 2020 21:16:56 GMT
AC don't pocket the difference between the notice account rate and the full loan rate. The difference is paid to the PF, to the protection of all lenders in that account. That's an incomplete description...
Any time the PF has a "surplus" AC can and do draw off the excess, and this is very much part of their profit margin/spread whenever it is positive.
It remains open whether AC will be accused of some form of wrongdoing if at some further time the PF proves insufficient such that the amounts AC have drawn off as profit already later turn out not to be a "surplus" or "excess".
Fair comment. Do you have evidence that they have drawn off excess?
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Mousey
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Post by Mousey on Mar 24, 2020 21:26:43 GMT
That's an incomplete description...
Any time the PF has a "surplus" AC can and do draw off the excess, and this is very much part of their profit margin/spread whenever it is positive.
It remains open whether AC will be accused of some form of wrongdoing if at some further time the PF proves insufficient such that the amounts AC have drawn off as profit already later turn out not to be a "surplus" or "excess".
Fair comment. Do you have evidence that they have drawn off excess? Quote from an e-mail from Assetz dated 27/09/2019:
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ilmoro
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Post by ilmoro on Mar 24, 2020 22:17:06 GMT
So the excess has gone to repay Assetz for their initial investment and to repay lenders in some distressed loans … none of it has gone to AC profits
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Mousey
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Post by Mousey on Mar 24, 2020 23:15:34 GMT
So the excess has gone to repay Assetz for their initial investment and to repay lenders in some distressed loans … none of it has gone to AC profits Well the use detailed in the e-mail was to repay lenders in distressed loans where I understand liability for losses was accepted by Assetz.
So whether the money taken from the PF has been used therefore to effectively artificially increase the stated company profits by avoiding the need for a subtraction or whether a corresponding balance sheet entry was added for the expected replenishment of the PF after sale of the assets is anyone's guess.
Whatever happens Assetz have clearly shown they are willing to change the rules on a dime with no hesitation whatsoever.
ETA: To clarify the comments made by sl75 in a subsequent post if I could rephrase my statement above to read: I understand liability for repayment of outstanding monies was accepted by Assetz.
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sl75
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Post by sl75 on Mar 25, 2020 17:40:35 GMT
So the excess has gone to repay Assetz for their initial investment and to repay lenders in some distressed loans … none of it has gone to AC profits That's a matter of interpretation - my understanding was that AC are drawing off the excess as profit, and then subject to sufficient availability of funds, are using those profits to make payments to certain lenders as a gesture of goodwill (and in particular, unlike @mousey's post above mine, I did not see anything suggesting AC was accepting liability)
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jlend
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Post by jlend on Mar 25, 2020 18:28:01 GMT
So the excess has gone to repay Assetz for their initial investment and to repay lenders in some distressed loans … none of it has gone to AC profits That's a matter of interpretation - my understanding was that AC are drawing off the excess as profit, and then subject to sufficient availability of funds, are using those profits to make payments to certain lenders as a gesture of goodwill (and in particular, unlike @mousey's post above mine, I did not see anything suggesting AC was accepting liability)
Some lenders have posted ACs response to their related complaints on this forum. If you read these you can make your own judgement about what liability AC have already accepted and the next steps.
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p2pfan
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Post by p2pfan on Mar 26, 2020 0:08:05 GMT
I tried to invest via the MLA and transferred money from my bank account there very slightly before AC initiated their withdrawal lockdown. I had the setting for h money to sit in QAA, as AC staff had repeatedly advised me was a good idea, while the money was awaiting investment through MLA.
Now the money is trapped in QAA due to AC's changes and has been there for several days. Tried to contacting AC a few times, but they won't release it.
Doesn't make sense for AC to keep lenders' money locked in QAA when they want to invest it via MLA, considering the MLA loans are desperate for long-term lenders at these times. I really hope AC 'fix' this.
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Post by Harland Kearney on Mar 26, 2020 0:33:22 GMT
I tried to invest via the MLA and transferred money from my bank account there very slightly before AC initiated their withdrawal lockdown. I had the setting for h money to sit in QAA, as AC staff had repeatedly advised me was a good idea, while the money was awaiting investment through MLA. Now the money is trapped in QAA due to AC's changes and has been there for several days. Tried to contacting AC a few times, but they won't release it. Doesn't make sense for AC to keep lenders' money locked in QAA when they want to invest it via MLA, considering the MLA loans are desperate for long-term lenders at these times. I really hope AC 'fix' this. Chirs said that in a few weeks you will be able to transfer your QAA holdings into the MLA. However, how that will work I don't know. It isn't exactly specfically helpful to your situation as you won't really be able to sell those holdings unless you discount at least 5-6% its looking like at the moment. I imagine once this feature is implemented they be a heavy supply of other sellers in the same postion too.
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Post by jasonnewman on Mar 28, 2020 13:03:51 GMT
Who will invest in QAA if you know your money is going to be stuck in a queue for a period of time, you might as well put it in the higher rate accounts? Why bother with 30/90 day AA if you need to pass through the eventual log jam in the QAA? Those that do are hoping the log jam will clear at some future point. It makes no sense to have these separate access accounts, AC need to consolidate all the access accounts and have a standard rate say 5% for the account. This will improve liquidity and de-risk the loans as you have a larger buffer of cash coming in to offset the withdrawals and simplify the product offering. Those who want access account can get it and those who don't can go to the MLA. The QAA is NO LONGER FIT FOR PURPOSE. You are getting a much lower rate with additional risk for no benefit. The market conditions have changed, so change the product offering that is suitable for the market rather than fudge the queue. AC needs to address this before the situation becomes worse. stuartassetzcapital chris |
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sl75
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Post by sl75 on Mar 28, 2020 13:22:26 GMT
jasonnewman - pretty sure your proposal would make the logjam several times worse in the short term.
Right now, anyone who requested a withdrawal from the 90DAA within the last 2 months isn't even in the withdrawal queue, so the current "logjam" merely represents withdrawals from the QAA, and those from the 30DAA/90DAA made more than 30 or 90 days ago respectively.
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Mikeme
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Post by Mikeme on Mar 28, 2020 13:32:10 GMT
Realism!!!! Not long before almost no interest will be paid to the platform.
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