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Post by GSV3MIaC on Aug 3, 2015 10:47:33 GMT
I notice that I am now sitting on (small) parts of 9 different Es which closed at MBR over the last week or so (and I still missed a few) .. I wonder if they will eventually turn into loans, or if the rates will be judged too high. Or maybe the borrowers (or Farewell Carbonpaper) are just having trouble with getting paperwork turned around at the blinding speed which is possible with an E? Presumable our friends with hungrier bots, or faster fingers, have several hundred £k tied up... not that it is an issue while the current loan drought continues.
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fasty
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Post by fasty on Aug 3, 2015 11:01:15 GMT
I was thinking about that too. Only sitting on 7 here; blinked and missed a few. If I were borrowing from an "E" position, I would be looking around elsewhere for cheaper finance until the last possible moment!
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Post by goldservice on Aug 3, 2015 12:02:18 GMT
They may be looking elsewhere for finance but won't they by now be committed to paying Fees Considerable? Many of the not yet drawn down E loans seem to be in pre-agreement - does this mean that interest is now clocking up? If so, then we can be Fairly Content.
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blender
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Post by blender on Aug 3, 2015 17:59:23 GMT
The interest is only clocking up if they take the loan. If they walk away they pay nothing.
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Post by GSV3MIaC on Aug 3, 2015 20:40:03 GMT
Even if they take it I am not sure it clocks up from the 'closed at MBR' time rather than the SCHEDULED auction end time (or the time they actually take it, if sooner).
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Post by goldservice on Aug 4, 2015 8:43:59 GMT
On the Repayments tab, and after the loan is drawn down/accepted, the status is Scheduled. The last status before this is is Pre-agreement; at that point the scheduled repayments are shown. This implies that the interest is accruing from one month before the first scheduled date shown. Has anyone seen loans at Pre-agreement being subsequently rejected?
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blender
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Post by blender on Aug 4, 2015 9:48:07 GMT
On the Repayments tab, and after the loan is drawn down/accepted, the status is Scheduled. The last status before this is is Pre-agreement; at that point the scheduled repayments are shown. This implies that the interest is accruing from one month before the first scheduled date shown. Has anyone seen loans at Pre-agreement being subsequently rejected? Oh yes, that definitely happens. You are right about interest accruing but it is contingent upon the agreement being reached. If not, you get nowt. Sometimes I suspect that borrowers agree to the loan in principle but look around for something better during this pre-agreement period. If they find something better then it might just time out or you get a note such as 'the borrower no longer needs the cash at this time' (because he has got it elsewhere).
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nick
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Post by nick on Aug 15, 2015 18:57:52 GMT
Even if they take it I am not sure it clocks up from the 'closed at MBR' time rather than the SCHEDULED auction end time (or the time they actually take it, if sooner). I raised this with FC who confirmed that interest accrues at the earlier of the scheduled auction end time and actual execution of the loan agreement (and not closed at MBR). At the moment, most E loans are only being executed near to the scheduled auction close and thus no interest is earned for the usual week between 'closed at MBR' and loan execution. It makes the economics of immediately flipping less attractive and I now look to keep E loans for at least a month before listing for resale (and hope the loan doesn't default in the intervening time).
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Post by GSV3MIaC on Aug 15, 2015 20:43:58 GMT
Thanks, that was what I suspected, and was working on, but I never actually got FC to confirm it. You dun good. Now if we can just get the megaflippers to do the sums ...
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wysiati
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Post by wysiati on Aug 16, 2015 11:23:33 GMT
Thanks, that was what I suspected, and was working on, but I never actually got FC to confirm it. You dun good. Now if we can just get the megaflippers to do the sums ... It would appear that some of them have. It should not hinder your strategy leaving blocks to be sold down at lower premiums/higher buyer rates? It is not necessarily large blocks directing pricing either; if one or more big blocks have a 'price taker' strategy, e.g. matching the marginal rate, then it is what others are doing which has the potential to set the tone. For example, I was experimenting around the launch of E risk band loans. Due to automation etc, putting in some LPs for sale at a higher buyer rate would often see these matched/exceeded by others, often within seconds/minutes.
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Post by GSV3MIaC on Aug 16, 2015 15:13:11 GMT
Yes, it does appear that (%deleted%) (at least I assume them, based on the volume .. can't tell unless I buy one or more) is willing to chase the markup all the way down to nothing much at all, in the interests of not getting caught with a packet. It then turns into a game of 'who blinks first', and there are quite a lot of sellers with modest amounts, probably .. I guess we may see some at a discount before long (already seen some at a loss-making markup, iirc). I wonder how the WL Es are faring .. I suspect they might go quite well.
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