Greenwood2
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Post by Greenwood2 on Apr 7, 2016 15:22:45 GMT
I've just added another tenner to my 1k in case someone pays back early and it freezes my Z+ lending. It's quite fiddly adding small amounts like that, Z have to find a way for each of the a/c's to recycle their own money or something. Although I would have liked to dip a smaller toe into Z+ initially, I think the impact of defaults on a £1k portfolio is too subject to chance. While we might expect 5 or 6 on average, the likelihood of 10 even if Zopa's portfolio as a whole performs according to expectations is still significant. This makes "likely" returns from this fluctuation alone 4-8.5% and so impossible to assess. to reduce this to approx. +/-1% requires 400 loans. I rather think that the £1k was set to make the random chance of defaults exceeding income over a year or more very small (less than 1 in 1000) to reduce the noise of those complaining from bad luck alone. (I assume the proportion calculating the return will be low, but most might notice an absolute decline).
- PM
I think there is deliberate selection of loans to keep your individual projected rate close to the overall predicted, so they add in a few low rate low risk loans to balance it out. Not sure what effect that will have if a lot of the high rate loans default diluting returns, but that is the same problem (although exaggerated) as with the Classic Account. It's going to take a bit of effort to check what is really happening (I wonder if they will add an 'actual returns' figure), and the new site doesn't help much as you're forced to use the MLB download and do all the sums yourself.
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momac
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Post by momac on Apr 7, 2016 22:09:18 GMT
Aaargh! I had forgotten about the tussles with the Loan Book when I shoved my £1K in to Zopa+ (put it down to excitement and nostalgia).
I CBA to wrestle with downloads, csv's or that sort of thing to work out things that were, and should be, obvious.
Fortunately, repayments are going in to my Holding Account and that is about to be emptied.
Never mind, I was there for the first tranche of Z+ and the last Listing.
Tee hee
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Greenwood2
Member of DD Central
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Post by Greenwood2 on Apr 8, 2016 6:10:32 GMT
Don't leave the party yet, the bands only just warming up!
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Post by ogwellian on Apr 8, 2016 10:34:25 GMT
I put just over £1k of my Classic on sale and I've been moving it across to Plus as it sells. It's taken about four days and yesterday morning there was enough to activate buying.
Currently I've got £310 lent out and £735 matched and zero in queue.
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Post by newlender on Apr 8, 2016 15:59:18 GMT
The Z+ queue seems to have got a move on mid-week and is now stuck again. Anyway, I'm quite pleased that I have £1.7k lent out now of the £2k of new money that I put in. A visible lending queue would be wonderful though; could Zopa not give us an idea of how much cash is waiting there? Presumably there won't be any institutional funds, or am I wrong? I wonder who on this forum will be first to get a payment from a Z+ loan - I feel a bit bad about looking out for a £2+ monthly payment on a £20 loan (I have several like that) but I suppose the borrowers know what they're doing  .
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Post by Ton ⓉⓞⓃ on Apr 8, 2016 17:22:33 GMT
I see that two people have paid back early already one had the loan for two days the other had for one day, I'm up a penny now!
So My £1010 is now down to £990. I've got re-lending off so the money seems to have gone into my Holding A/c. All the Z+ money is in the pool for matching(£230) or is Pending(£250) or is lent, and there's no notice saying add money to get back up to £1k, as there was a couple of weeks ago when I only had about 4 or 500 in there.
I'll switch lending back on (my default is is ZC), but I'll leave Z+ at £990 to see what happens
12.4.16 UPDATE; One more has made a full early repayment, but as I've switched on re-lending (Auto top up) I can see that the money in Z+ is indeed recycling itself back into Z+. So it appears that capital will now stay in the Z+ a/c with out any effort from me. Thus I imagine all the other a/c will also recycle back into themselves so long as I have re-lending switched on.
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Post by newlender on Apr 8, 2016 17:49:02 GMT
I wonder why they paid back so soon. I have quite a few that haven't been withdrawn yet and so technically are not loans - is that what you meant?
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Post by Ton ⓉⓞⓃ on Apr 8, 2016 21:22:07 GMT
I wonder why they paid back so soon. I have quite a few that haven't been withdrawn yet and so technically are not loans - is that what you meant? This happens a certain amount. Someone applies for a loan but either they change their mind or their circumstances change perhaps a relative says they will loan them the money, almost anything is possible we never really get to hear the reason. One thing is that there is a shortish period in which the Borrower can cancel the loan and effectively get it for free, AIUI, I think they still pay the interest which in my case was one penny but the Zopa fee is effectively not charged so long as it cancelled in the cooling off period (someone correct me if I'm wrong here). So I'm not talking about "Pending Withdrawal".
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Greenwood2
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Post by Greenwood2 on Apr 9, 2016 14:26:12 GMT
People shop around as well, they may have been offered a better rate somewhere else.
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Post by Ton ⓉⓞⓃ on Apr 9, 2016 15:18:48 GMT
Yes Greenwood2 how many times have you bought something only to find the next that you could've got it cheaper or a better version somewhere else? But I guess taking out the loan with Z must have an effect on the Borrowers credit score so it must be self defeating in the long term i.e. over several months not weeks. As it would probably put up the Borrowers apparent risk and thus APR. Also I should imagine that the Borrower might be barred from applying for another loan with Z for a period of time, after all Zopa did a whole series of checks (underwriting) with their associated costs for no benefit. |
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Greenwood2
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Post by Greenwood2 on Apr 11, 2016 10:44:26 GMT
If, as Z+ lenders we are in an A*,A, B or C loan that could also be offered to Classic lenders, do we get a higher rate because it's not safeguarded? The borrower has presumably paid additional fees to support the safeguard fund, but we get no benefit unless we get a balancing increase in rate, so I hope that is the case.
I haven't seen any extremely low rate A* loans (sub 3%) that I did see on the old safeguarded loans, but not sure if this is coincidental.
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Post by Ton ⓉⓞⓃ on Apr 11, 2016 11:11:00 GMT
If, as Z+ lenders we are in an A*,A, B or C loan that could also be offered to Classic lenders, do we get a higher rate because it's not safeguarded? The borrower has presumably paid additional fees to support the safeguard fund, but we get no benefit unless we get a balancing increase in rate, so I hope that is the case. I haven't seen any extremely low rate A* loans (sub 3%) that I did see on the old safeguarded loans, but not sure if this is coincidental. I've some exceptionally low ZA loans* but the lowest Z+ is 3.11 with about 5more greater than that but still in the 3% band. *ZA loans of 1.53 & 1.15 %
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Post by propman on Apr 11, 2016 12:09:03 GMT
I thought much (all?) of the credit fees paid to SG are now charged to borrowers through th eterm rather than as an upfront fee. As such, in Z+ we will receive the entire "interest" (net of the Zopa charge previously called the lenders fee), while in Classic, part will go to the SG.
- PM
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Greenwood2
Member of DD Central
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Post by Greenwood2 on Apr 11, 2016 14:35:59 GMT
You are right PM. I assume the borrower pays an ongoing fee to Zopa off the top of each payment and then the remainder is divided amongst lenders. If a whole loan is allocated to Plus the whole payment should be divided amongst lenders. If loans are shared between Classic and Plus it would be more difficult to organise. I assume that is what happens, and on the A* loans there probably isn't a very high percentage payment to Zopa, so the rates don't look very different on Classic or Plus, as I said I'm not seeing any very very low rates on Plus, although I only saw a few sub 3% loans on the original safeguarded loans.
I suppose I wasn't really expecting to see so many low rate loans on Plus, very much overlapping with rates on my original safeguarded loans. Just have to wait and see how actual rates pan out.
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Post by retired on Apr 11, 2016 19:50:33 GMT
Only just joined but have been investing in P2P for a while. A question:
Z+, how do I know what rate I am actually achieving?
If I understand the information displayed correctly I can see the 'blended' rate of the various loans I have made and I can see the projected return after the anticipated defaults. How do I know what rate I am actually achieving? If I'm really lucky I could get close to the 'blended' rate (I wish) or if unlucky I could get lower than the projected rate. Either way seems to me to be quite important to know just how well or badly I'm doing.
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