markr
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Post by markr on Nov 26, 2014 10:09:58 GMT
When I logged into RS today, I had more funds in my holding account than I expected, because I'd had *nine* contracts repaid early. A little investigation reveals a puzzle. All 9 contracts were made on the same day, 17th July 2013, and varied between 5.4% and 5.7% so it's unlikely to all be the same borrower. It was a period of declining rates, so I had my orders at various rates to try and catch spikes, and I remember that on that day, matches pretty much tore through the queue eating up all that was on offer. As you can see from the rate trend chart, that day wasn't a spike but a step up in rates of around 0.5% and the start of the slow upward trend that we've enjoyed since. I offer this mainly as an interesting statistical observation but with the niggling thought that as far as I know, we can't tell early repayments apart from provision fund settlements (will 17/7/13 become known as RS's Black Wednesday??).
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jlend
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Post by jlend on Nov 26, 2014 11:09:24 GMT
In case it helps
Nothing repaid early on the 5 year market for me today
Only had two loads paid off early in the 5 year market this month - from 11th and 13th November 2013, settled on 20th and 24th November 2014
Must admit I've never looked before how many loans are paid back early for whatever reason (provision fund or borrower)
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oldgrumpy
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Post by oldgrumpy on Nov 26, 2014 11:39:01 GMT
Strange you should get 9 all of a sudden. None for me on a substantial portfolio. I also had just three in the last month or so.
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Post by geoffrey on Nov 26, 2014 12:25:42 GMT
I had two of those repayments today as well. Strange. Still, nice to have some cash to catch the little spike we're having today, and probably through to the end of the month. There seems to be an exceptional amount of demand on the four /five-year market at the moment.
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Post by westonkevRS on Nov 26, 2014 22:00:33 GMT
I hope Markr doesn't mind, but we had a little look at his bunch of repayments.
They were basically all from the same single loan that repaid early. His multiple repayments that were reinvested from different loans previously are kept separately. So rather than grouping together and being lent as one contract, they remained as separate loan reinvestments but all went to the same loan as they would have been close/next to each other in the queue to be lent.
Some might say this is inefficient processing, others might be glad to know that they get more and more diversified as repayments are made, split into loans, split into repayments and onwards to infinitum... To infinity and beyond.....
Kevin.
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Post by p2plender on Nov 27, 2014 6:49:16 GMT
Thanks, worth knowing.
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markr
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Post by markr on Nov 27, 2014 9:33:25 GMT
I don't mind at all. Looking at the amounts of the contracts and knowing how I run my account, I don't think in this case the funds were repayments, more likely they were a single lump sum deposit that I manually broke up and spread through the rate bands, which happened to get matched into the same loan. I do think it would be good is RS told us when an early repayment was due to a call on the provision fund. I can see why they would be reluctant but they could view it almost as a marketing opportunity, an email along the lines of "you were credited xxx from the provision fund to repay loan xxx which has defaulted. Defaults are inevitable, but the provision fund has protected your capital and interest, every lender, every penny, blah blah". Also, returning to the other point, I still think 17/7/13 was an interesting day in RS history. Rates had been plunging downwards and for the beginning of July had sat at an all time low of around 5.0%. Then, suddenly, on the 17th, rates stepped up to 5.5% and began an upward climb to the 6% or so we see now, the day can easily be seen in the rate trend. Interestingly, Zopa's rates were on the same decline but has continued it and if it wasn't for the rate promise would now be sub-5%. Whatever RS did on that day it was a blooming good idea and probably made the company the success it has become. Attachments:
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Post by westonkevRS on Nov 27, 2014 12:49:53 GMT
I joined on 1st July 2013.... It took me two weeks to get my feet under the table before causing chaos.....
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c88dnf
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Post by c88dnf on Nov 27, 2014 12:52:25 GMT
Also, returning to the other point, I still think 17/7/13 was an interesting day in RS history. Rates had been plunging downwards and for the beginning of July had sat at an all time low of around 5.0%. Then, suddenly, on the 17th, rates stepped up to 5.5% and began an upward climb to the 6% or so we see now, the day can easily be seen in the rate trend. Yes, I remember it too. I think what happened was quite simple. Supply and demand. The inflow of funds slowed down and demand went up by a noticeable amount too. At the time the average weekly "sale" was under £2M, so the market and rates was much more sensitive to someone dumping their matured building society deposit onto RS. Look at the weekly demand graph and it goes up by a good 10% during July 2013, then continues to rise steadily. Interestingly, rates are starting to rise again at the moment for pretty similar reasons. In recent months, supply of funds inwards has easily matched "sales" and at times exceeded them. Rates dropped. Now over the past month the queue of money in my favoured 5-year market has dropped from £2.0M to £0.8M, but loans out have been stable. Rates have stabilised and started to recover. The flies in the ointment are that the amount of loans going out has stopped growing and there is likely to be a surge in funds inwards in the first week in December, followed by the usual lull in loans around Christmas. In the longer term the lack of growth in loans is more of a concern, but let's enjoy the moment while we can!
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Post by GSV3MIaC on Nov 27, 2014 23:30:03 GMT
My supply of funds is sitting awaiting the de-purplization (or at least de-spacing) of the website. 8>. Not that I expect I can move rates much on my own. Maybe Gnasher and I together though ...
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