am
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Post by am on Feb 23, 2015 18:10:29 GMT
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coop
Member of DD Central
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Post by coop on Feb 23, 2015 18:20:04 GMT
Thanks for the heads up!
8%? Pfft, no thanks!
I've already started decreasing my holdings with FC, this will only serve to accelerate that process.
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Post by davee39 on Feb 23, 2015 19:13:10 GMT
Some people are hard to please. One of the gripes about FC is that loans have inadequate security, so here we have a secured loan, although not perhaps at the nice 60% LTV's that we would like. FC will need to introduce more fixed rate deals to secure borrowers who might otherwise go elsewhere. I expect to see £200k+ asset backed loans offered at fixed rates because the auction model can lead to higher rates than borrowers might deserve. Perhaps the rig installations and other asset companies will return. The problem with the rate is that will make the loan illiquid on the secondary market.
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coop
Member of DD Central
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Post by coop on Feb 23, 2015 19:37:14 GMT
Maximum return and minimum risk - that's not too much to ask!  |
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Post by loanstar on Feb 23, 2015 20:24:45 GMT
Interesting to see investors asking questions. Given the rate is fixed, all the borrower has to worry about is how quickly it will fill.
This is more of a test of rate and LtV by FC.
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Post by GSV3MIaC on Feb 23, 2015 20:46:24 GMT
Interesting to see investors asking questions. Given the rate is fixed, all the borrower has to worry about is how quickly it will fill. This is more of a test of rate and LtV by FC. How quickly and 'IF'. 8>. However for small ones, autobid/buy will do the job. For larger ones (like the mooted £200k) you need to lure some manual bidders &/or flippers to the party, and I don't think 8%, no cashback, and fairly exposed LTV is going to do it. ('Fairly exposed is actually generous, they way I read it the asset value is <=60% of the loan for most of the loan period, even assuming you can find a buyer, you can find the asset, and it hasn't had a tree fall on it). Nope, definitely one for the autobidders...
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sl75
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Post by sl75 on Feb 23, 2015 21:23:49 GMT
I'll probably lose 5p on this one - I'd placed my initial £20 bid before I noticed that this was FC's first fixed rate auction without cashback. The interest rate is below the level that I'd normally automatically [1] offer for sale on sight with no premium.
[1] as in what I do myself as an automatic reflex action - I'm not in the "bot club" (yet?)
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am
Posts: 1,495
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Post by am on Feb 24, 2015 11:32:57 GMT
Interesting to see investors asking questions. Given the rate is fixed, all the borrower has to worry about is how quickly it will fill. This is more of a test of rate and LtV by FC. How quickly and 'IF'. 8>. However for small ones, autobid/buy will do the job. For larger ones (like the mooted £200k) you need to lure some manual bidders &/or flippers to the party, and I don't think 8%, no cashback, and fairly exposed LTV is going to do it. ('Fairly exposed is actually generous, they way I read it the asset value is <=60% of the loan for most of the loan period, even assuming you can find a buyer, you can find the asset, and it hasn't had a tree fall on it). Nope, definitely one for the autobidders... It is the same rate as a lot of property development loans, but with a LTV of 165% (spurious precision) rather than 65% (contrast exaggerated). On the other hand it's not a non-amortising loan with exit risks. On the gripping hand it's a depreciating asset. So it's not easy to compare.
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TitoPuente
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Post by TitoPuente on Feb 24, 2015 12:28:43 GMT
This is all good but the key issue is liquidity.
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