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Post by newlender on Jan 2, 2017 11:37:33 GMT
Was the £2K from your holding account or did you pay sell-out fees? Might not be such a good move if you factor in the lack of PF for Z+ holdings. I put in £1K the week before Christmas when they were briefly accepting deposits again - it's still not fully matched.
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ashtondav
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Post by ashtondav on Jan 2, 2017 16:06:33 GMT
Holding account.
Selling out of 3 year i was quoted a fee that equated to 5% of my holding! And they continue to advertise an "average" fee of under 1%....
I couldn't get a quote to sell my 5 year loans, despite them being at an average of 6.3%. So selling out of 3 year would have been VERY expensive and selling out of 5 year was impossible. RS seriously need to get their sh*t together. I was only tempted before ZOPA introduced +, and RS rates were 6%+. Now, I'm shifting it all back to ZOPA, or at least I will until i can get at least 5.7% on RS 5 year.
Oh, and dont get depressed. The period between xmas and new year is the quietest. But we are now heading for one of the busiest months of the year. Back in the day I used to shift £4K+ on ZOPA in January at rates of 7%+
Been a member since September 2005 so i still get an extra 1%pa, which makes it even better!
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ashtondav
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Post by ashtondav on Jan 2, 2017 16:18:35 GMT
No I dont understand it either. But then there's too many things i don't understand about RS, which is why i'm shifting back to ZOPA.
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Post by newlender on Jan 2, 2017 18:19:38 GMT
Why did you want to sell your 5 year loans if they were earning 6.3%? Z+ doesn't offer much more than that after expected defaults. Although to be honest I've found the default rate since inception much lower than their forecasts. I agree with your 5.7% for 5 year and there's a lot of cash in the queue that seems to want 5.5% or above. My 5 year loans, even since I began in 2014, are averaging over 6% so I shan't be selling those anytime soon.
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james
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Post by james on Jan 2, 2017 23:45:54 GMT
Holding account. Selling out of 3 year i was quoted a fee that equated to 5% of my holding! And they continue to advertise an "average" fee of under 1%.... I couldn't get a quote to sell my 5 year loans, despite them being at an average of 6.3%. So selling out of 3 year would have been VERY expensive and selling out of 5 year was impossible. That gives the appearance of misleading by RateSetter and a failure to treat you and others fairly, in part because: 1. At the time you invested any charge would be used for the protection fund to benefit you and other investors but now it is taken by RateSetter, harming your position compared to the deal offered at the time you invested. 2. I assume that the 1% is the real average for only those who do sell and ignores those quoted unreasonable costs who do not then go on to sell. An everyone we ask says we are great (we ignore the ones who don't) approach. Giving average of quotes and averages for each term and year would be closer to being accurate and fair about what to expect. Zopa has a somewhat similar, though less extreme and unreasonable, approach. The Zopa approach doesn't go and pretend that you had funded a shorter term loan as the RateSetter one does. The best solution is really not to use platforms like those two that can have unreasonable charges for exiting. Exiting at no cost or even a profit is readily available elsewhere.
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Post by blanik on Jan 3, 2017 7:57:37 GMT
RS - 3yr - 5.6% - can sell about 95% of total value, sellout fee 3.2%
5 yr - 6.4% - can sell about 87% of total value, sellout fee 4.7%
On RS, loans below £10 cannot be sold, I have a few of these on RS due to recycling interest.
I have no intention on selling, but am currently running down the loan book.
Zopa Plus - 6.9% ABD, can sell 91% of total value, sellout fee 1.01%
Classic - 4.5%, can sell 96% of total value, sellout fee 4.08% !!!!
pre-SG - 7.0%, can sell 82% of total value, sellout fee 1.00%
So Zopa is generally about 1%, but it can throw up some quirks.
I'm quite surprised on the interest penalty on Classic, as classic is currently offering 3.9%.
I had previously sold most of my Classic portfolio at 1% cost to fund Plus, so what is left is not a representative loan book. I suspect I am left with a few high rate loans with a bad payment history that I cannot sell, but inflate my current rate. The other loans range from about 2.2% to 6.5%, so I am probably being penalised on the rates below average, but gaining nothing from the rates above average.
At least on Zopa it is the buyer of the loan who will gain the advantage of the above average rates, and not the platform.
To get the quote from Zopa it is a bit odd. After doing the obvious of going in to the product, sell loans, get quote - I then have to go back and repeat the sell loans button to see the numbers. ( Perhaps this is just me ).
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james
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Post by james on Jan 3, 2017 9:38:08 GMT
The rate being 3.9% instead of 4.5% may be why the Classic fee is so much higher, to take from you the capital gain you would have made because of the lower interest rate
The Zopa one may be a bit more indirect in some ways in that some higher rate from your sale goes to the buyer but Zopa can then just take it back in higher fees charged on other loans while still hitting the specified rate.
So for Zopa at least I'm unsure if the fee for Classic is really raised to take capital gain from you or if it is all indirect. Might even be different for different products and loan origination dates. Maybe Zopa could explain if you asked. It would be interesting to know and it could even be as simple as being a bug.
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Post by blanik on Jan 3, 2017 13:39:32 GMT
My understanding is that the Zopa interest adjustment is only calculated going forward to compensate the buyer for getting a low rate loan, there is no backward calculation - that is an RS thing.
The current explanation of the interest rate fee is "If any of your transferred loans are at a lower rate than what could be earned on a similar loan in the current market, the recipient will be credited the difference in interest. This figure represents the total expected difference in interest you will need to credit other investors."
As I originally sold about 90% of my classic portfolio, I would have been left with the 'worst' loans. Those that were below the current rate at the time, those with a bad history, and those waiting for a DD payment.
By playing with some figures, I can sell about 1/3 of my remaining portfolio with no compensation. Selling one extra loan, which is a - £5.90 B at 5.58% costs me 2p, selling my last loan - a £4.68 C1 at 2.2% costs me 34p.
I think what might be happening that I'm paying compensation when I sell the lower than current rate loans, and receiving no corresponding credit for the higher than current rate loans - if each loan was valued when sold then the compensation would probably net to zero or a small payment to me.
In trying to sell the whole portfolio the process has the same flaws as RS in that the cost of selling the worst loans affects the overall average. At least Zopa split out the compensation cost so you can see what it is and experiment where it kicks in.
All kind of accedemic as I have no intention to sell. Since Zopa has changed the system I have been re-investing my Classic repayments in Plus - so eventually the loans will run down.
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ashtondav
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Post by ashtondav on Jan 3, 2017 13:41:14 GMT
Why did you want to sell your 5 year loans if they were earning 6.3%? Z+ doesn't offer much more than that after expected defaults. Although to be honest I've found the default rate since inception much lower than their forecasts. I agree with your 5.7% for 5 year and there's a lot of cash in the queue that seems to want 5.5% or above. My 5 year loans, even since I began in 2014, are averaging over 6% so I shan't be selling those anytime soon. As a founder member i get a 1% bonus. Therefore my expected ZOPA+ target is 7.5%. Anyway, I just wanted to get a quote for checking out at RS because I am not happy with their business model or lack of transparancy. Sometimes ZOPA isn't much better - but it is better.
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Post by BrianC on Jan 9, 2017 20:28:48 GMT
When I log in I'm no longer seeing the notice about wether they're accepting new money or not. What's changed?
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marie
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Post by marie on Jan 10, 2017 8:28:07 GMT
When I log in I'm no longer seeing the notice about wether they're accepting new money or not. What's changed? We are probably back to normal!
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Post by dualinvestor on Jan 10, 2017 8:41:29 GMT
When I log in I'm no longer seeing the notice about wether they're accepting new money or not. What's changed? We are probably back to normal! I suspect we are bak to "normal" for a little while at least. When they introduced January's platform limit it was £10million I think, by yesterday it was down to £2million and then dissappeared. They lend more than £10million a week according to the weekly update, a lot of that will be funded by borrower repayments but there could be a number of reasons for needing fresh lending capital, higher demand for loans than expected, bigger withdrawals because investors have to pay for their own Christmas or their tax bills etc or a combination, or even people being put off by not being able to deposit. It will be interesting to see whether the limit is reintroduced as circumstances change throughout the year.
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