gg
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P2P ISA
Aug 30, 2016 11:09:11 GMT
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Post by gg on Aug 30, 2016 11:09:11 GMT
When the new ISAs are up and running i expect rates to fall dramatically due to cash rich new lenders depositing vast sums in to the p2p platforms.
The new ISAs will be good news for the higher rate tax payers and pants for basic rate tax payers. Non tax payers will see only falling rates and little, if any, upside.
gg
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ablender
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Post by ablender on Aug 30, 2016 11:11:18 GMT
When the new ISAs are up and running i expect rates to fall dramatically due to cash rich new lenders depositing vast sums in to the p2p platforms. The new ISAs will be good news for the higher rate tax payers and pants for basic rate tax payers. Non tax payers will see only falling rates and little, if any, upside. gg Are you going to be one of the cash rich that will quickly move all your savings to a new product?
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gg
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Post by gg on Aug 30, 2016 11:15:10 GMT
When the new ISAs are up and running i expect rates to fall dramatically due to cash rich new lenders depositing vast sums in to the p2p platforms. The new ISAs will be good news for the higher rate tax payers and pants for basic rate tax payers. Non tax payers will see only falling rates and little, if any, upside. gg Are you going to be one of the cash rich that will quickly move all your savings to a new product? Afraid not. I will be a basic rate taxpayer watching my p2p returns fall by more than the tax that I save. i will keep looking for better places to put my money but p2p has served me well since 2006. gg
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ablender
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Post by ablender on Aug 30, 2016 11:18:19 GMT
Are you going to be one of the cash rich that will quickly move all your savings to a new product? Afraid not. I will be a basic rate taxpayer watching my p2p returns fall by more than the tax that I save. i will keep looking for better places to put my money but p2p has served me well since 2006. gg Many people have discussed this a few months back. No one really knows. We just have to wait and see. Personally, I doubt many people will just rush in. P2P has been around offering interest rates better than banks for several years. Tax or no tax it still makes a difference. Yet, not everyone invests in P2P, and a good percentage of those who do, do not trust more than a certain percentage of their worth in P2P.
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adrianc
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Post by adrianc on Aug 30, 2016 11:51:38 GMT
Afraid not. I will be a basic rate taxpayer watching my p2p returns fall by more than the tax that I save. i will keep looking for better places to put my money but p2p has served me well since 2006. gg Many people have discussed this a few months back. No one really knows. We just have to wait and see. Personally, I doubt many people will just rush in. P2P has been around offering interest rates better than banks for several years. Tax or no tax it still makes a difference. Yet, not everyone invests in P2P, and a good percentage of those who do, do not trust more than a certain percentage of their worth in P2P. I'm not so sure. Everybody thinks "Oooh, ISA" - and for many, it's the only part of their savings that do go outside the comfort of a nice simple bank account of one form or another. P2P's becoming much more mainstream in terms of Joe Public's awareness, too. Combine the two, I think you are going to see a decent inrush - and, let's face it, it doesn't need a VERY large percentage of the public-at-large to swamp the existing size of the sector.
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ablender
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Post by ablender on Aug 30, 2016 16:25:26 GMT
pepperpot and adrianc : How do you see your argument balancing in terms of discussions such as those in the thread What % of your entire portfolio is in P2P? Perhaps I cannot see beyond my limited amount of money, but do you think that people are just going all out with risking their money?
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fp
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Post by fp on Aug 30, 2016 17:30:46 GMT
I think anyone worried about interest rate drops is doing so for a good reason, as soon as a P2P isa gets on money saving expert or any other similar page, it will be inundated with an influx of cash from not so savvy investors thinking a crock of gold has just dropped at their feet.
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ablender
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Post by ablender on Aug 30, 2016 18:23:14 GMT
Well P2P and ifISA have already been mentioned on Money Expert. I am not saying that it will definitely not happen; just saying that we will have to wait it out.
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ali
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Post by ali on Aug 30, 2016 18:42:21 GMT
It's an interesting question. I've got a feeling that the banks/building societies are also more money sensitive than you might imagine. That is, if some significant amount of money started flowing out into P2P (or anywhere), then I suspect they would increase their rates until the flow was balanced out again.
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Post by loanstar on Aug 30, 2016 19:11:27 GMT
The trouble is that banks and building societies are able to borrow money very cheaply on the wholesale money markets. Gone are the days when they had to worry too much about savers deposits. At best they break even on savings accounts.
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adrianc
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Post by adrianc on Aug 31, 2016 7:43:02 GMT
pepperpot and adrianc : How do you see your argument balancing in terms of discussions such as those in the thread What % of your entire portfolio is in P2P? Perhaps I cannot see beyond my limited amount of money, but do you think that people are just going all out with risking their money? As pepperpot says - think wider. There's currently a very small number of people in P2P. Let's say 500k people averaging £50k in, for the sake of argument. Think much wider - 2m new people averaging £10k in.
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Post by propman on Aug 31, 2016 8:28:02 GMT
pepperpot and adrianc : How do you see your argument balancing in terms of discussions such as those in the thread What % of your entire portfolio is in P2P? Perhaps I cannot see beyond my limited amount of money, but do you think that people are just going all out with risking their money? As pepperpot says - think wider. There's currently a very small number of people in P2P. Let's say 500k people averaging £50k in, for the sake of argument. Think much wider - 2m new people averaging £10k in. I am very worried and expect 6 months with no lending when IFyISAs become available due to a substantial drop in rates of the more secure sites. That said, I think people are overestimating the investable funds available to most. A high proportion of people's assets are in their properties and pensions and the majority of people don't move their pensions and only downsize properties when forced to (ie needing a significant portion of funds released in the short term). A fair proportion of my friends that might well be suited to P2P lending are not prepared to take the risk and many IFAs treat it as an alternative to venture capital / small cap / high risk markets as it is unproven and so are not advocating it. I also suspect that the amount invested by current investors is skewed with a high proportion from a minority of investors with many holding a small pot. I think it is these that will create the wall of money with many cash ISAs transferring in. That is why I think that rates will fall precipitously but recover slowly.
JMHO of course!
- PM
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Oct 25, 2016 7:15:33 GMT
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ablender
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Post by ablender on Oct 25, 2016 7:53:18 GMT
Which ones would they be? I wonder . . . (before 2014, complicated models)
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Post by easteregg on Oct 25, 2016 8:59:08 GMT
I have heard mutterings about some of the different business models, where the platform fills the loan first and then sells the loan parts, rather than the lender directly funding the borrower, may not be P2P as far as the FCA is concerned, however please don't take that as fact!
However at LendIt on October 10th Chris Woolard from the FCA indicated that authorisations would be proceeding imminently, so it is a little surprising that some companies are now finding that they are going to be rejected.
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