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Post by wellesleyco on Apr 2, 2014 8:17:48 GMT
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Post by henders on Apr 2, 2014 8:25:12 GMT
Wow!!!
Congratulations; and here was I saying you were hiding your light under a bushel somewhat!
Feel a bit stupid now (not for the first time).
Great news!!
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oldgrumpy
Member of DD Central
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Post by oldgrumpy on Apr 2, 2014 10:35:46 GMT
WOTTAWHOPPER!! I expect all our funds will be lent out immediately for quite a while now. Edited 4 April. Not so. I still have funds from 17 Feb not in use - not that it matters really.
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markr
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Post by markr on Apr 2, 2014 10:52:20 GMT
Wow, well done Wellesley!
The FT article is behind a paywall but there's limited free access if you don't mind registering.
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shimself
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Post by shimself on Apr 2, 2014 12:44:05 GMT
The press release also mentions the auto matching feature (without which I won't lend any more), so let's hope it really happens.
It goes on to say this will introduce maximum diversification, fine, but presumably this whopper will actually be a large proportion of all their business for some time.
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pikestaff
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Post by pikestaff on Apr 2, 2014 21:22:10 GMT
When I see loans this size on the platform I know the provision fund is worthless. Provision funds work fine when you have lots of small loans (Ratesetter, Zopa) but they cannot work when you have small numbers of large loans. If there was a loss on this loan it would almost certainly be a multiple of the provision fund. For p2b I will stick to the platforms that do not have a provision fund.
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Post by westcountryfunder on Apr 3, 2014 9:32:37 GMT
When I see loans this size on the platform I know the provision fund is worthless. Provision funds work fine when you have lots of small loans (Ratesetter, Zopa) but they cannot work when you have small numbers of large loans. If there was a loss on this loan it would almost certainly be a multiple of the provision fund. For p2b I will stick to the platforms that do not have a provision fund. Possibly I have misunderstood something. Even though there is only one borrower (presumably), this loan is spread across 27 properties and surely it is extremely improbable that every individual mortgage will go wrong. Much will depend on the exact terms of the loan and what exactly would constitute a default. Perhaps Wellesley could comment on this, but it seems likely to me that this has been structured in such a way that the situation is little differerent to 27 separate loans. I think an explanation could be helpful.
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Post by oldnick on Apr 3, 2014 17:16:51 GMT
When I see loans this size on the platform I know the provision fund is worthless. Provision funds work fine when you have lots of small loans (Ratesetter, Zopa) but they cannot work when you have small numbers of large loans. If there was a loss on this loan it would almost certainly be a multiple of the provision fund. For p2b I will stick to the platforms that do not have a provision fund. Possibly I have misunderstood something. Even though there is only one borrower (presumably), this loan is spread across 27 properties and surely it is extremely improbable that every individual mortgage will go wrong. Much will depend on the exact terms of the loan and what exactly would constitute a default. Perhaps Wellesley could comment on this, but it seems likely to me that this has been structured in such a way that the situation is little differerent to 27 separate loans. I think an explanation could be helpful. Come on Wellesley, communication has been your strong suit thus far. Some reassurance that you haven't swallowed too large a loan for the size of your existing book would be welcome.
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Post by wellesleyco on Apr 4, 2014 7:10:05 GMT
Thank you so very much to everyone on this forum for their positive comments, we appreciate your support immensely. We would also like to thank the P2P Independent Forum for moving Wellesley to the main section of the site, we consider the site to be one of the best places to communicate with our customers. Sorry for the delay in responding to the last couple of comments, we had a very busy day yesterday however please rest assured the flow of communication will not stop. The deal that we announced is £8.3M which is spread across 27 properties in two London Boroughs and also an area of Essex (all of which sit inside the M25). Importantly, the property sizes are all sensible, with the largest being around £1M and many being less in size and as such all fit into our criteria of being readily realisable if needed to be sold as a result of default. westcountryfunder, you are completely right, the loan is broken down into many pieces of security and is in essence more like a portfolio in terms of the risk profile. What is even more attractive about the deal is the fact that our security is cross collateralised meaning if for some reason the loan defaulted, we have our choice over which of the properties could be enforced upon. pikestaff, we appreciate your comment however would like to explain our perspective on the security presented to our lenders. We consider our provision fund to be a valuable aspect of the service however there are two more important lines of defence in the case of default. Firstly, the LTV is 60% which is relatively low and I cannot foresee a situation whereby we would not be able to sell the properties at a value higher than 60% of their market value, secondly, Wellesley has its own funds in the deal and importantly please note that our rights to the security are subordinated behind the rights of our customers. This means that in the case of default, our customers share of the loan would have first call over the asset before we could recover our money which means that every time we make a loan we do so knowing that our own money is at risk first, quite sobering I assure you. As such, we see the provision fund as being the 3rd line of defence in this instance. I trust this helps. shimself, thank you for your comments, they are always valued. Please rest assured the auto diversification tool will happen and we are finalising some aspects before setting it live. Its major system upgrade (and industry first) and therefore we would rather test it many times rather than launch quickly and risk bugs. To address your last point, we have an enormous pipeline of business (around £30M of loans approved through credit committee) and I expect us to complete on another loan this morning in excess of £1M. Any questions, please feel free to ask. Kind regards Wellesley & Co
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Post by cautious on Apr 4, 2014 9:32:46 GMT
Dear Wellesley and Co.
Sorry if I've missed this point elsewhere, but does W&C have a policy of a minimum holding figure for each loan that W&C retain...i.e a minimum fixed percentage holding for W&C per loan regardless of excess lenders funds being available ?
Best regards.
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mikes1531
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Post by mikes1531 on Apr 4, 2014 10:29:58 GMT
This huge loan doesn't strike me as the same as a portfolio of 27 individual loans because there's just one borrower. So either the loan is OK or it's in default, at which point all 27 properties might need to be sold. So the Provision Fund does look small by comparison.
But I do accept the points that a collection of smaller properties would be much easier to sell than one large one, and also that W&C have a lot of their own money in the loan and the lenders will be repaid before W&C. So I'm not too concerned about the size of this one loan.
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Post by chielamangus on Apr 4, 2014 11:10:04 GMT
With the dramatic change in the loan book, and all my investments officially loaned out, I'm giving W a vote of confidence by sending across more money. Goodbye Ratesetter, Hello Wellesley!
There have been some derogatory comments on other sites (AC, I think it was) about ignorant savers choosing the Wellesley or Ratesetter model - they don't have the sophistication to invest wisely in AC or FC, apparently - but I see it as reclaiming my life. Far too much time has to be spent appraising the proposals and monitoring events. Yes, returns on capital are higher, but taking account of returns to labour I see Wellesley as the most efficient vehicle at present.
I had a surpise this morning with Ratesetter when money I thought was safely invested for a year suddenly turned up in my holding account. Even though it is called a "Bond" it can actually be redeemed anytime by the borrower. So more hassle to reinvest it at a time when rates are much lower than the previous rate. So that money will be with W on Monday.
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Post by chielamangus on Apr 4, 2014 12:17:55 GMT
Wellesley said "We would also like to thank the P2P Independent Forum for moving Wellesley to the main section of the site, we consider the site to be one of the best places to communicate with our customers."
Chielamangus says "This forum is no substitute for announcements and information on your own site!"
As previously discussed ....
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Post by oldnick on Apr 4, 2014 22:54:22 GMT
With the dramatic change in the loan book, and all my investments officially loaned out, I'm giving W a vote of confidence by sending across more money. Goodbye Ratesetter, Hello Wellesley! There have been some derogatory comments on other sites (AC, I think it was) about ignorant savers choosing the Wellesley or Ratesetter model - they don't have the sophistication to invest wisely in AC or FC, apparently - but I see it as reclaiming my life. Far too much time has to been spent appraising the proposals and monitoring events. Yes, returns on capital are higher, but taking account of returns to labour I see Wellesley as the most efficient vehicle at present. I had a surpise this morning with Ratesetter when money I thought was safely invested for a year suddenly turned up in my holding account. Even though it is called a "Bond" it can actually be redeemed anytime by the borrower. So more hassle to reinvest it at a time when rates are much lower than the previous rate. So that money will be with W on Monday. The 'derogatory' comments on the AC site that you mention may be my reference to unsophistocated investors. I should have enclosed the words unsophistocated investor with quote marks as it was my intention to differentiate from the use of the phrase 'sophisticated investors' to refer to people who have experience and appreciation of the risks of investments where losses are possible, which is not the case with building society deposits guaranteed by the taxpayer. I then compounded the issue by writing that 'even the simplest form of investing on AC's site is probably beyond them'. The background to my comments was that my daughter had shown an interest in depositing some money she had inherited in p2p in order to beat the rate of inflation. At present her money is in a building society account, which of course does not do that. She knew that I had been putting money into various p2p set ups for some years and asked me to explain the concept and procedure. At the end of a short explanation from me my (soon to graduate) daughter thanked me but said that she was unwilling to provide that much input into investing her nest egg as she had other priorities. I pointed out that I had been seeking the higher returns that were attainable with concerns like AC and that lesser, but still acceptable, returns were on offer with, for example, Wellesley. At no point did my daughter find my suggestion to be derogatory towards her, or conclude that she should consider herself ignorant because she wasn't prepared to be as 'hands on' in the p2p market as I was. She is confident in the mental skills she possesses and has been very patient in trying (unsucessfully) to teach me how to solve Rubik's cube over the years. The new auto invest option that is being intently discussed on AC's board at the moment is probably going to be a very convenient way of investing money when it has finished being fine tuned, but even then will still not appeal to my daughter at this stage of her financial awareness. I haven't contributed to the nitty gritty of the AI discussion because sharper intellects than mine are trained on it and I am content to wait until I may have something worthwhile to contribute (not an inevitability). Which is a long winded, but hopefully detailed enough, explanation for the real intent behind my posts. Notwithstanding that I apologise for causing offense.
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Post by davee39 on Apr 5, 2014 8:19:11 GMT
I agree with the sentiments regarding the simplicity of the wellesley model. Having invested in P2P for several years I believe I am reasonably adept at sniffing out the platforms I want to avoid. Assetz certainly has its fans, but I found it just too complicated, and I also like to start seeing a return straight away. With the now pressing need to stretch my pension capital safely I am more than satisfied by the boost given by Wellesley returns while leaving the investment decisions to the experts. Having observed the carnage among Irish Banks as a result of unwise property lending I cannot get carried away by piling in all my savings (The London bubble may burst), but a small proportion has found a home on the shorter 18 month term.
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