teddy
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Post by teddy on Oct 27, 2016 9:58:20 GMT
I have just over £5K in the GBBA, although most of that balance has only been put in there in the last few weeks. However, I've had a few hundred in the account and lent out since June, but have had nothing more than a few pence in interest and no repayments.
I have a lot of interest credits of £0.00 which are presumably too small to show in standard format as the loans are tiny.
Can someone please explain what's going on. It takes far too long and too much effort to see if the loans are in default, and if they were, I'd expect the PF to kick in. I really like the idea of 7%, but this account doesn't appear to be doing what it says on the tin.
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SteveT
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Post by SteveT on Oct 27, 2016 10:03:52 GMT
Presumably your accrued interest total will be increasing as well. Quite a few loans pay capital and interest as a "bullet" at term, rather than monthly. Many others pay interest monthly but only repay capital at term.
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Post by bracknellboy on Oct 27, 2016 10:40:14 GMT
Presumably your accrued interest total will be increasing as well. Quite a few loans pay capital and interest as a "bullet" at term, rather than monthly. Many others pay interest monthly but only repay capital at term. Ooooh, hadn't thought of that. So I may be in for a bigger pay day than I was expecting: I was thinking that the vast majority my 'accrued' was down to the happy pairing of 'Effing and Ippy', plus one or two other miscreants. Still probably is..... EDIT: This does however raise a huge question - or at least one I hadn't thought about before. Presumably this also means if one was to withdraw money from the account, you wouldn't get the 'interest' payment until such time as the lenders actually paid the interest. Which also would mean if one was to close one's AC account entirely, you'd never see it. Umm. This account is not as obvious as one might think it was dressed up to be.
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SteveT
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Post by SteveT on Oct 27, 2016 10:44:24 GMT
Presumably your accrued interest total will be increasing as well. Quite a few loans pay capital and interest as a "bullet" at term, rather than monthly. Many others pay interest monthly but only repay capital at term. Ooooh, hadn't thought of that. So I may be in for a bigger pay day than I was expecting: I was thinking that the vast majority my 'accrued' was down to the happy pairing of 'Effing and Ippy', plus one or two other miscreants. Still probably is..... For MLIA holdings you can see how much of your accrued interest is in each loan in the "Your Loans" view, IIRC. I assume whatever's left must be GBBA / GEIA accrued interest.
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teddy
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Post by teddy on Oct 27, 2016 11:00:58 GMT
Presumably your accrued interest total will be increasing as well. Quite a few loans pay capital and interest as a "bullet" at term, rather than monthly. Many others pay interest monthly but only repay capital at term. There's a bit on the Q&A section of the GBBA about getting hold of your money. Paraphrasing, it says that you can withdraw as long as there are other lenders to replace you, otherwise you get your capital back over the lifetime of the loans. Note, over the lifetime of, not at the end of. So, this begs the question, how do I know which of my loans are repayable over term, and which are repayable at the end of term? I'm expecting £30 a month interest from my GBBA investments, but I don't think this is actually going to happen.
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SteveT
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Post by SteveT on Oct 27, 2016 11:10:59 GMT
Unless you laboriously decipher your loan holdings (by downloading the statement to Excel and working out a way to total them) and then look them up individually, you won't. It's a black box. Eventually, by hook or by crook (assuming the PF covers any losses) you will end up getting 7%, but not necessarily any time soon.
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teddy
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Post by teddy on Oct 27, 2016 11:21:56 GMT
I suspect you're quite right. It's really not good enough though. The practical running of the GBBA is entirely different to how it makes you think it's run. AC make you think it's a yearly 7% return with equal monthly interest payments and repayments of capital . Clearly it isn't.
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SteveT
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Post by SteveT on Oct 27, 2016 11:45:45 GMT
That's why I much prefer to lend via the MLIA instead, where I know exactly what I'm buying, how much I hold, how much has been repaid, I can read the relevant loan updates and I earn an extra 4.5% (average) to offset future losses. Like other things in life, it's better with the light on.
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jonah
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Post by jonah on Oct 27, 2016 15:46:01 GMT
I suspect you're quite right. It's really not good enough though. The practical running of the GBBA is entirely different to how it makes you think it's run. AC make you think it's a yearly 7% return with equal monthly interest payments and repayments of capital . Clearly it isn't. I agree GBBA has a lot of 'oh I didn't think it would work like that' moments.* But mine pays me some interest most days. Basically I get interest on the same day as a mlia investor but only at 7%. Capital repayments also seem to match repayments made to mlia from what I've seen for loans I hold in both accounts. my GBBA has been doing well recently, running at 100% invested for a while. So if you aren't getting yours invested or not getting any interest from loans which should be paying out I would suggest ringing customer services. About mlia being better... I agree for those with sufficient skills and time. My plan is to slowly reduce my GBBA and increase mlia as I gain in confidence in my ability to due appropriate analysis of loans. Until then, so far at least, GBBA isn't a terrible parking place for some spare cash on a short / medium term basis. *such as capital repayments from the PF for any loans in default only happen after any attempts to recover the money, not like RS, as I understand it. I'm still not sure if the PF is intended to cover 'lost' interest. Also getting a vote on default interest on a loan I only hold in GBBA which is limited to 7% seems a little like cruel and unusual punishment.
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teddy
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Post by teddy on Oct 27, 2016 19:35:59 GMT
*such as capital repayments from the PF for any loans in default only happen after any attempts to recover the money, not like RS, as I understand it. I'm still not sure if the PF is intended to cover 'lost' interest. Also getting a vote on default interest on a loan I only hold in GBBA which is limited to 7% seems a little like cruel and unusual punishment. It's ridiculous that I'm taking a substantial hit on interest in order to have the relative safety of the PF, but still have to go through the same long winded rigmarole as those in the MLIA when a loan goes sour. The PF is there for a reason, and people in the GBBA should have immediate access to it when needed. the PF can then be refilled when the security is sold. Lenders in the GBBA shouldn't have to wait.
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pikestaff
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Post by pikestaff on Oct 27, 2016 21:27:56 GMT
It's ridiculous that I'm taking a substantial hit on interest in order to have the relative safety of the PF, but still have to go through the same long winded rigmarole as those in the MLIA when a loan goes sour. The PF is there for a reason, and people in the GBBA should have immediate access to it when needed. the PF can then be refilled when the security is sold. Lenders in the GBBA shouldn't have to wait. They could possibly have decided to run the GBBA like that, but (1) they would have had to put a LOT more money into the PF; and (2) it would not be paying 7%. More likely 5-6% at best.
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mikes1531
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Post by mikes1531 on Oct 28, 2016 22:06:57 GMT
It's ridiculous that I'm taking a substantial hit on interest in order to have the relative safety of the PF, but still have to go through the same long winded rigmarole as those in the MLIA when a loan goes sour. The PF is there for a reason, and people in the GBBA should have immediate access to it when needed. the PF can then be refilled when the security is sold. Lenders in the GBBA shouldn't have to wait. They could possibly have decided to run the GBBA like that, but (1) they would have had to put a LOT more money into the PF; and (2) it would not be paying 7%. More likely 5-6% at best. It would be so much simpler of the GBBA and GEIA were run the same way as the QAA/30DAA. No need to detail all of the transactions of the underlying loans, get invited to vote, etc., etc. Just keep track of investors' balances over the course of a month and pay interest earned in one month at the beginning of the following month. If a loan goes bad, the PF makes the appropriate payments in lieu and everything works smoothly.
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pikestaff
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Post by pikestaff on Oct 29, 2016 7:01:59 GMT
They could possibly have decided to run the GBBA like that, but (1) they would have had to put a LOT more money into the PF; and (2) it would not be paying 7%. More likely 5-6% at best. It would be so much simpler of the GBBA and GEIA were run the same way as the QAA/30DAA. No need to detail all of the transactions of the underlying loans, get invited to vote, etc., etc. Just keep track of investors' balances over the course of a month and pay interest earned in one month at the beginning of the following month. If a loan goes bad, the PF makes the appropriate payments in lieu and everything works smoothly. Yes it would. But, if the PF worked like that, it would need a lot more money upfront which AC possibly could not afford, and it would be less stable because you would not need many loans to stop paying before the PF was wiped out, even if the loans were recovered eventually. It's a lot harder to run a PF for a granular portfolio like AC's than it is on RS where most of the loans are relatively small. I'm sure AC thought about this when they decided to structure the GBBA/GEIA in the way that they have. Lately, most of the business loans have tended to be smallish and with better property security than in the past. The diamond loan, which I believe to be ineligible for the GBBA, is an exception. When the new-style portfolio gets large enough this might enable AC to launch a GBBA mark 2, structured as you would like. But if they do, I expect it to pay closer to 5%.
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teddy
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Post by teddy on Oct 30, 2016 11:47:56 GMT
Given that I've significantly increased my GBBA balance during October, I've decided that I'll give it until mid November. If I've not received interest payments in line with what I should be getting, then I'll be on the phone.
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mikes1531
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Post by mikes1531 on Oct 30, 2016 20:18:38 GMT
Given that I've significantly increased my GBBA balance during October, I've decided that I'll give it until mid November. If I've not received interest payments in line with what I should be getting, then I'll be on the phone. : Please come back to us after mid-Nov and let us know how you get on.
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