trium
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Post by trium on Jun 6, 2021 11:13:58 GMT
Out of interest, my weighted average gross return on loans picked up since lending resumed in February is 10.73% (in Plus). That'll almost certainly change over time. As defaults start occurring that average return will reduce. In theory in Plus you'll probably also see a few more defaults than those in Core (but some loans have much higher interest rates to make up for that ) You seem to have missed the word "gross" in my post Defaults won't affect it. As for maturity, the account dates back to 2011.
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Post by fuzzyiceberg on Jun 7, 2021 11:02:10 GMT
However, in my view p2p is a failed concept. It was a neat idea at the start, but now there is just not enough margin available on loans for platforms to make a profit while giving individual investors great returns.
That said, ironically, the fact that Z has now closed to all new money suggests even the existing investor returns being offered are super-normal as they are attracting much more money than is needed. It wouldnt surprize me to see Z cutting expected returns (and loan rates) further in order to attract more borrowers.
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Greenwood2
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Post by Greenwood2 on Jun 7, 2021 11:41:57 GMT
I'm still quite happy with a pretty steady 4% + early adopter bonus + tax relief on losses.
The worst thing is that you can no longer get sensible answers from their customer services. In the good old days you could talk to or Email someone who actually knew as much or more about the platform than you did. Now you have to try to explain things to people who seem to have little clue and are probably cutting and pasting answers from a script, like a typical call centre.
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Post by ingenue on Jun 10, 2021 13:40:39 GMT
That'll almost certainly change over time. As defaults start occurring that average return will reduce. In theory in Plus you'll probably also see a few more defaults than those in Core (but some loans have much higher interest rates to make up for that ) You seem to have missed the word "gross" in my post Defaults won't affect it. As for maturity, the account dates back to 2011. Can you explain what you mean by "gross return" in this context? I'm not sure that I understand.
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Post by mfaxford on Jun 10, 2021 14:11:01 GMT
Can you explain what you mean by "gross return" in this context? I'm not sure that I understand. From the rest of the comment it sounds like the overall interest rate from a subset of their loans without taking into account the time that money hasn't been earning or the likely defaults that will occur. So a pretty meaningless figure.
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aju
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Post by aju on Jun 11, 2021 10:18:56 GMT
Not sure if it helps much but investopedia says this In P2P terms i guess the fees or expenses would be probably include default losses as well. The other issue is that as time progresses the defaults will have a much heavier impact that seriously can reduce interest numbers quite a bit. In the most recent debt sale there were instances of seemingly recent loans being sold off and there were a considerable number of Also i would point out that the interest rates that were quoted of >10% may be for one loan and more loans following that specific item would in fact be much lower as Zopas engines smooths things out. One problem i have noticed is that in a good number of cases the loans with high rates tend to be paid off quicker if they don't default. In addition to that I'm not sure the selling engine balances things quite as well as the lending engine but i've never actually checked it meticulously. In my case also 21 of the recent 31 loans that were paid off (Settled!) were covid based but i'm not sure that their status was before the debt sale at present. In my case this is the first appearance of settled's in the new loan book but I can see that the amount paid for each loan is much higher in this sale - in my case anyway not yet checked mrs aju. Just some omy thought on this though i'm happy to be wrong.!
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Post by ingenue on Jun 11, 2021 12:27:48 GMT
Not sure if it helps much but investopedia says this In P2P terms i guess the fees or expenses would be probably include default losses as well. The other issue is that as time progresses the defaults will have a much heavier impact that seriously can reduce interest numbers quite a bit. In the most recent debt sale there were instances of seemingly recent loans being sold off and there were a considerable number of Also i would point out that the interest rates that were quoted of >10% may be for one loan and more loans following that specific item would in fact be much lower as Zopas engines smooths things out. One problem i have noticed is that in a good number of cases the loans with high rates tend to be paid off quicker if they don't default. In addition to that I'm not sure the selling engine balances things quite as well as the lending engine but i've never actually checked it meticulously. In my case also 21 of the recent 31 loans that were paid off (Settled!) were covid based but i'm not sure that their status was before the debt sale at present. In my case this is the first appearance of settled's in the new loan book but I can see that the amount paid for each loan is much higher in this sale - in my case anyway not yet checked mrs aju. Just some omy thought on this though i'm happy to be wrong.! Thanks for taking the time to think about all that; I think I've got it now. Maybe it's the word 'return' that threw me. It's not really a return until it's returned.
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trium
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Post by trium on Jun 11, 2021 17:23:25 GMT
Well, as the post said it was out of interest and not intended to create a fuss I was referring to the weighted average of the interest rates accruing on loans issued on my behalf recently. Zopa used to give us that figure but no longer do. What they do give us is the projected 'net' figure after anticipated bad debt. By comparing the two you can infer something about the level of default to expect and by monitoring your actual bad debt you can see how that compares with expectations. That is useful to me, if not to other posters.
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Post by c64 on Jun 11, 2021 18:24:07 GMT
Can anyone tell me what the wait time actually is just now, for (a) reinvestment and (b) a manually queued sum? If it is long enough for them to impose these restrictions it is long enough for me to want to plan around. I'm sitting on an accumulating cash balance at Zopa for now and ideally will start using it to take up new loans early next year, so I am wondering when to hit "queue this lump sum" and when to hit "start reinvesting repayments" in order to aim for actual investment concentrated around a given date, say 1 March. I'm sure this used to be reported somewhere but it is not evident at www.zopa.com/invest.
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Post by ingenue on Jun 11, 2021 22:55:10 GMT
Well, as the post said it was out of interest and not intended to create a fuss I was referring to the weighted average of the interest rates accruing on loans issued on my behalf recently. Zopa used to give us that figure but no longer do. What they do give us is the projected 'net' figure after anticipated bad debt. By comparing the two you can infer something about the level of default to expect and by monitoring your actual bad debt you can see how that compares with expectations. That is useful to me, if not to other posters. Thanks for the clarification. 10.73% seems like quite a low number for that figure, but hopefully it reflects a more conservative spread of loans across credit ratings than during the bad old days of plus.
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trium
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Post by trium on Jun 12, 2021 8:47:02 GMT
Can anyone tell me what the wait time actually is just now, for (a) reinvestment and (b) a manually queued sum? If it is long enough for them to impose these restrictions it is long enough for me to want to plan around. I'm sitting on an accumulating cash balance at Zopa for now and ideally will start using it to take up new loans early next year, so I am wondering when to hit "queue this lump sum" and when to hit "start reinvesting repayments" in order to aim for actual investment concentrated around a given date, say 1 March. I'm sure this used to be reported somewhere but it is not evident at www.zopa.com/invest. The latest indicative queueing times are communicated in the weekly update which you should receive by email. This week was 50 days ( Plus) and 56 days (Core). I'm not sure there is a difference between reinvested money and accumulated holding account balances.
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Post by c64 on Jun 12, 2021 14:34:07 GMT
Thanks for that heads-up - I think I must have opted out of those mails, will go find. "Fifty ish" will do me.
Automatically invested repayments were queued ahead of "new money" last time I read anything about that, maybe five years ago. They do say "investors who make lump sum payments into Zopa have twice as much money waiting to be matched as those who just reinvest repayments" just now, which unhandily does not answer any useful question.
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coogaruk
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Post by coogaruk on Jun 14, 2021 11:07:29 GMT
It was a neat idea at the start, but now there is just not enough margin available on loans for platforms to make a profit while giving individual investors great returns. There never was.
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bloom68
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Post by bloom68 on Jul 15, 2021 15:30:20 GMT
Since ZOPA stopped accepting new P2P deposits, has anyone had success in returning any of this year's flexible withdrawals?
I've been making flexible withdrawals since the start of the tax year, and now want to put them back into an ISA. Usually in such circumstances you just re-deposit them into the account from which they were withdrawn. But with ZOPA now stopping accepting deposits (with no notice I might add) I seem to have hit a problem. To be clear I don't expect to be able to reinvest the funds into ZOPA P2P loans, I just want to pay the funds back into ZOPA and then transfer them out.
I queried this with ZOPA and initially they said it would be fine and I could just send the funds in the normal way, since I would then be transferring them out. So I tried that, and they bounced the funds straight back to me.
I raised it again with ZOPA and they went away to think about it, returning about ten days later to say "your ISA is still flexible, we only report the capital you hold with Zopa to HMRC. If you place the funds into a different ISA within the same tax year this will not affect your ISA allowance." but I don't see how that can work.
HMRC rules say "Replacement of flexible ISA previous year funds must be made to the account from which the withdrawal was made, and in the same tax year."
I've already subscribed £20k of new funds to another ISA in the current tax year, and am pretty sure that if I deposit the funds flexibly withdrawn from ZOPA into another ISA elsewhere that it will eventually be picked up by HMRC as an oversubscription.
Has anyone else had the same issue?
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Post by Ace on Jul 15, 2021 15:47:51 GMT
Since ZOPA stopped accepting new P2P deposits, has anyone had success in returning any of this year's flexible withdrawals? I've been making flexible withdrawals since the start of the tax year, and now want to put them back into an ISA. Usually in such circumstances you just re-deposit them into the account from which they were withdrawn. But with ZOPA now stopping accepting deposits (with no notice I might add) I seem to have hit a problem. To be clear I don't expect to be able to reinvest the funds into ZOPA P2P loans, I just want to pay the funds back into ZOPA and then transfer them out. I queried this with ZOPA and initially they said it would be fine and I could just send the funds in the normal way, since I would then be transferring them out. So I tried that, and they bounced the funds straight back to me. I raised it again with ZOPA and they went away to think about it, returning about ten days later to say "your ISA is still flexible, we only report the capital you hold with Zopa to HMRC. If you place the funds into a different ISA within the same tax year this will not affect your ISA allowance." but I don't see how that can work. HMRC rules say "Replacement of flexible ISA previous year funds must be made to the account from which the withdrawal was made, and in the same tax year." I've already subscribed £20k of new funds to another ISA in the current tax year, and am pretty sure that if I deposit the funds flexibly withdrawn from ZOPA into another ISA elsewhere that it will eventually be picked up by HMRC as an oversubscription. Has anyone else had the same issue? AIUI, Zopa's statement is only correct for current tax year funds. Since your funds with Zopa are previous tax year funds they do need to go back to Zopa and be transferred out to keep their ISA status.
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