seeingred
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Post by seeingred on Mar 6, 2017 18:32:28 GMT
"They might go variable and have us bid it down to near zero. "
Please don't say things like that, you could put ideas into someone's head.
The risk is low, hence the rate?
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hazellend
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Post by hazellend on Mar 6, 2017 18:44:41 GMT
For a higher rate tax payer it's not worth getting out of bed for.
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stevio
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Post by stevio on Mar 6, 2017 18:49:41 GMT
Ridiculous - I still can't quite believe anyone will fund it. I'd love to know what % SS are getting - likelihood they are receiving more than the lender Sure they will. Over on FC they're happily filling unsecured loans at 6.5% ! Same return as BM
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trevor
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Post by trevor on Mar 6, 2017 18:53:12 GMT
I never thought I would reject an SS loan and invest in an FC loan.
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GeorgeT
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Post by GeorgeT on Mar 6, 2017 19:01:21 GMT
The name of the game is "How low can we go".
If this one fills, which it will, the next smallish loan will be offered at 6%. And so on...
More fool the fools who are funding these and enabling this.
If investors stood together as one, like a cartel, they would not be able to get away with this blatant profiteering.
For a platform where risk is high, defaults are already happening, the Provision Fund has just been depleted, and investors are advised to undertake their own Dude Diligence, this is taking the ****
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jamesc
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Post by jamesc on Mar 6, 2017 19:11:15 GMT
Unfortunately they could bring a small loan at 1% and it would fill because too many people have default prefunding levels. They might not want it after the event, but the loan will fill, probably even be oversubscribed !
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Liz
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Post by Liz on Mar 6, 2017 19:15:11 GMT
If investors stood together as one, like a cartel, they would not be able to get away with this blatant profiteering. Market forces  I'm waiting for the 5% loans, they will be ultra-low risk.
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Liz
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Post by Liz on Mar 6, 2017 19:18:01 GMT
Unfortunately they could bring a small loan at 1% and it would fill because too many people have default prefunding levels. They might not want it after the event, but the loan will fill, probably even be oversubscribed ! I would pay them to look after my money for me, PF protected  Negative rates, now that would be fun. I think people are paying for the liquidity on SS, until the SM ceases up, rates will keep falling. The PF promise really is doing the trick. Some people see SS as very secure, akin to a deposit account. Edit: Maybe the re-brand will be to shavingstream. Shaving our returns. Or maybe diminishingreturns!
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Mar 6, 2017 19:48:26 GMT
Its a house, valued as a house, with an exit plan dependent on it being a house. 12 months means the borrower has plenty of time to apply for planning & if that doesnt come off, then tart it up and sell at an uplift. Much as Id like 12% loans, I cant see this one would be offered at much more on any platform.
The biggest risk is probably that the rate means it is potentially illiquid on the SM.
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Mar 6, 2017 20:07:30 GMT
Its a house, valued as a house, with an exit plan dependent on it being a house. 12 months means the borrower has plenty of time to apply for planning & if that doesnt come off, then tart it up and sell at an uplift. Much as Id like 12% loans, I cant see this one would be offered at much more on any platform. The biggest risk is probably that the rate means it is potentially illiquid on the SM. That's all fine and dandy if we knew what the borrower was being charged. If that was 13%, then I would understand, and take that as an indication of risk the borrower presents Nobody is blaming SS for wanting to increase their loan book, but while SS consistently offer loans at low rates simply because it is a small loan, investors are going to be questioning the rate, and whether or not they are getting screwed.
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Jeepers
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Post by Jeepers on Mar 6, 2017 22:11:47 GMT
I can't help feeling we're all being fobbed off by SS.
One of the directors (Tim, I think) said in an interview that the biggest loans carried the least risk because the receivers fees wouldn't take such a big proportion of the proceeds.
Now they're telling us that the lower rate loans (which are only on small loans) reflect the lower risk. Get a grip!
At the end of the day, the bigger loans (supposedly least risky) wouldn't fill at 7% hence they are offered at 11%. Market forces mean the riskiest loans are giving the lowest returns! 😤
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bg
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Post by bg on Mar 6, 2017 22:32:18 GMT
I don't see what there is to complain about. If you don't like the rate, don't invest. I'd love to see all loans at 20% with a free cake for investors but the reality is it's a competitive market.
7% for a less than 50% LTV residential property seems about right to me. It would be at a similar rate on many other platforms, seems a very low risk proposition. SS have openly said they have switched to bringing loans at various rates (and not just at 12%) across the risk spectrum which allows them to expand into and compete in various markets they weren't in before. This is clearly a good example of that.
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Mar 6, 2017 22:39:31 GMT
I don't see what there is to complain about. If you don't like the rate, don't invest. I'd love to see all loans at 20% with a free cake for investors but the reality is it's a competitive market. 7% for a less than 50% LTV residential property seems about right to me. It would be at a similar rate on many other platforms, seems a very low risk proposition. SS have openly said they have switched to bringing loans at various rates (and not just at 12%) across the risk spectrum which allows them to expand into and compete in various markets they weren't in before. This is clearly a good example of that. Thats great, and I see your reasoning for this loan. So when do you think we're going to see another <£500k 12% loan? Or <£1m 12% loan? From where I'm standing, looking at the <12% we've seen so far, SS aren't basing the rates on risk.
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am
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Post by am on Mar 6, 2017 22:48:56 GMT
I don't see what there is to complain about. If you don't like the rate, don't invest. I'd love to see all loans at 20% with a free cake for investors but the reality is it's a competitive market. 7% for a less than 50% LTV residential property seems about right to me. It would be at a similar rate on many other platforms, seems a very low risk proposition. SS have openly said they have switched to bringing loans at various rates (and not just at 12%) across the risk spectrum which allows them to expand into and compete in various markets they weren't in before. This is clearly a good example of that. AC does BTL mortgages at this level or lower. I don't think I've seen a bridging loan that low anywhere.
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Steerpike
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Post by Steerpike on Mar 6, 2017 23:22:31 GMT
6.5% 66% LTV bridge on LendInvest right now.
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Negative rates, now that would be fun. 
