stevio
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Post by stevio on Nov 11, 2016 18:14:41 GMT
FS is a bit of a untamed stallion - a unique beast, if you can find some way to ride it, grabbing hold and trying to hold on for dear life, without being bucked off and/or kicked  , I think it's still possible to make some profit Select up to 3 answers, some people have more than one account or use more than one strategy Mention below any other strategies and I can try to add them to the poll if popular As FS has some unique features, just trying to get ideas, allow others to see ways might be able to turn a profit |
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n
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Yet another Nick
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Post by n on Nov 11, 2016 18:31:35 GMT
I put 'simply hold loans to term', which I do for some other platforms, but there are enough property loans coming through that I can achieve my platform limit by bidding £25 in each (there being too many to do any signinficant DD). I put more into non-property as I think the chances of recovery are generally pretty good, not being pressed for time.
I never use the SM as I am not confident that I will not end up making a loss after tax.
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mikes1531
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Post by mikes1531 on Nov 11, 2016 18:33:47 GMT
If someone adopts "Invest PM and sell on SM prior to term at par/discount" as their primary strategy, they need to realise that it's easier said than done. So they have to be prepared to use "Simply hold loans till term" as their secondary strategy for those parts that aren't sold before they become unsellable. Either that, or they have to be prepared to sell at a very high discount, though I suspect that even that won't work for some loans.
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stevio
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Post by stevio on Nov 11, 2016 18:34:56 GMT
I put 'simply hold loans to term', which I do for some other platforms, but there are enough property loans coming through that I can achieve my platform limit by bidding £25 in each (there being too many to do any signinficant DD). I put more into non-property as I think the chances of recovery are generally pretty good, not being pressed for time. I never use the SM as I am not confident that I will not end up making a loss after tax. Sorry, thought I could add to a poll, but apparently can't. Investing a small amount in every loan is as good a strategy as any though
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Neil_P2PBlog
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Post by Neil_P2PBlog on Nov 11, 2016 18:49:51 GMT
My strategy:
1. Buy all of the FFF/fast selling pawn loans, unless they are something very difficult to value. List at a 2% or 3% premium on the secondary market just incase someone buys but otherwise hold to term.
2. Buy discounted lower LTV loans on the secondary market after considering tax. I avoid those where there was initially a cashback.
3. I go for around 1/3rd of the new property loans, with interest of those with cashback, low LTV, a low price (like a residential house that would resell more easily), or something that has an clear need for finance and is mutually beneficial (like that loan a while back where the bank required the borrower to pay the inheritance tax before being allowed to sell the property). I try to avoid property loans that are likely to hang around in the PM for ages or just buy them as they are nearly fully funded.
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SteveT
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Post by SteveT on Nov 11, 2016 18:54:56 GMT
Before anyone gets led astray, the first strategy listed only really makes any sense for non-taxpayers and company lenders (that can offset accrued interest purchased against interest ultimately paid)
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archie
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Post by archie on Nov 11, 2016 19:03:00 GMT
I don't buy much property but those I do I will try and sell near par on the sm as they near maturity (60-70 days out).
The pawn loans I'll usually keep to maturity and usually renew (I've decided not to renew the train loans as it does appear that new loans may be paying the old loans interest, hopefully I'm wrong).
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mikes1531
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Post by mikes1531 on Nov 11, 2016 22:33:36 GMT
Before anyone gets led astray, the first strategy listed only really makes any sense for non-taxpayers and company lenders (that can offset accrued interest purchased against interest ultimately paid) While that strategy does make more sense for the groups mentioned, if the discount is more than 1% it could work for basic-rate taxpayers as well. I've decided not to renew the train loans as it does appear that new loans may be paying the old loans interest, hopefully I'm wrong. It sure looks that way. That isn't a problem in itself, as long as the borrower has a sufficient supply of bits to use as security. But I do wonder, if the borrower were to default, whether FS might have difficulty trying to sell £400k of railway memorabilia and models in a relatively short period of time. The market might be big enough to absorb all that at once, but I just don't know.
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stevio
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Post by stevio on Nov 12, 2016 8:40:19 GMT
I noticed since the underwriters have been used for renewals, cashback has dried up
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SteveT
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Post by SteveT on Nov 12, 2016 11:22:10 GMT
I noticed since the underwriters have been used for renewals, cashback has dried up I'm sure that FS have redeployed the margin that was previously going towards CB into covering underwriters' fees instead. And it is clearly having a much greater effect on liquidity. It's noticeable how much faster the renewal loans fill once they have been underwritten; possibly some of that is due to other funds being released and reinvested from other underwritten loans, but I do wonder if a significant subset of FS lenders still haven't cottoned on that interest starts accruing immediately these days, not just once a loan completes.
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Post by mrclondon on Nov 12, 2016 12:38:09 GMT
Something else:
Buy on both PM and SM*, sell on SM* or hold to maturity.
* buy on SM at a discount equal to or greater than the tax liability I'm inheriting; sell on SM at a discount equal to or less than the tax liability I'm passing on (I'm currently a basic rate tax payer)
I never buy anything I'm not comfortable about holding to maturity and beyond if so required.
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phil
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Post by phil on Nov 14, 2016 14:06:13 GMT
My strategy: 1. Buy all of the FFF/fast selling pawn loans, unless they are something very difficult to value. List at a 2% or 3% premium on the secondary market just incase someone buys but otherwise hold to term. What is a FFF loan? Thanks. Edit: Is it a loan from family, friends and fools
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Neil_P2PBlog
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Post by Neil_P2PBlog on Nov 14, 2016 14:17:58 GMT
phil - I meant Fastest Finger First where everyone rushes to buy on the dot at 11am, like the 13% Rolex renewal will probably be tomorrow!
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elliotn
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Post by elliotn on Nov 18, 2016 11:25:09 GMT
A similar post has been subsumed within a technical discussion on the SM so I think this is better suited here, pls feel free to delete other post . As a newbie my strategy for buying re-sold loan parts is continually evolving as I get used to the nuances of FS. Where there are differently prioritised loan parts on SM can the borrower still repay smaller, later 'charges' from part sales of the property first ie the enforcement priority of different loans outlined in the overviews (on the same first charge) only stand in the instance of a default otherwise the borrower can repay active loans at his/her own prerogative? |
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SteveT
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Post by SteveT on Nov 18, 2016 11:56:49 GMT
A similar post has been subsumed within a technical discussion on the SM so I think this is better suited here, pls feel free to delete other post . As a newbie my strategy for buying re-sold loan parts is continually evolving as I get used to the nuances of FS. Where there are differently prioritised loan parts on SM can the borrower still repay smaller, later 'charges' from part sales of the property first ie the enforcement priority of different loans outlined in the overviews (on the same first charge) only stand in the instance of a default otherwise the borrower can repay active loans at his/her own prerogative? I can't yet think of a multi-tranche loan on FS where individual tranches have been repaid in stages but, based on standard practice elsewhere, as a lender I'd generally expect to see: - 2nd / 3rd charge tranches repaid before 1st charge tranche(s) since these will be incurring higher costs for the borrower, provided of course that LTV on the 1st charge is not impaired as a result (if, say, units start to be sold off from a multi-unit development) - where tranches rank pari-passu, earlier tranches repaid ahead of later tranches (certainly this is how such repayments are processed on FC)
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, I think it's still possible to make some profit
