r1200gs
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Post by r1200gs on Feb 19, 2017 7:29:46 GMT
I cannot understand how this would work. Can you please elaborate? My whole portfolio is 12%, it would be pointless prefunding an 8% loan, earning free interest for a couple of days as I'd then have to sell one of my 12% loans in a day or two to clear the negative balance. SS are offering 8 percent loans because there is a line of suckers investors a mile long who will fund them, simple as that. They have said as much on this forum, though using different words. They have no need to "stop the gaming" to get a couple of days free interest, though that will happen at the end of the month anyway.
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Post by jackpease on Feb 19, 2017 7:57:33 GMT
My whole portfolio is 12%, it would be pointless prefunding an 8% loan, earning free interest for a couple of days as I'd then have to sell one of my 12% loans in a day or two to clear the negative balance. SS are offering 8 percent loans because there is a line of suckers investors a mile long who will fund them, simple as that. They have said as much on this forum, though using different words. They have no need to "stop the gaming" to get a couple of days free interest, though that will happen at the end of the month anyway. I'm a sucker then. Even as we speak there are people talking about leaving SS because the lower rates than before. I find this bizarre because if you have money to invest today you need to look at what on offer today - balancing loan risk, platform risk, reward and availability. So while I regret the lowering of rates/increase in risk that is happening all the way from savings accounts, mortgages and P2p, some of the eight percenters still make sense imho, and some of the 12%-ers don't. Jack P
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Post by geraldine1210 on Feb 19, 2017 8:22:35 GMT
SS are offering 8 percent loans because there is a line of suckers investors a mile long who will fund them, simple as that. They have said as much on this forum, though using different words. They have no need to "stop the gaming" to get a couple of days free interest, though that will happen at the end of the month anyway. I'm a sucker then. Even as we speak there are people talking about leaving SS because the lower rates than before. I find this bizarre because if you have money to invest today you need to look at what on offer today - balancing loan risk, platform risk, reward and availability. So while I regret the lowering of rates/increase in risk that is happening all the way from savings accounts, mortgages and P2p, some of the eight percenters still make sense imho, and some of the 12%-ers don't. Jack P I don't think the problem is so much that there are 8% loans. It is, in my opinion, the fact that Saving Stream said they would be taking on better quality loans and to do that would need to offer a lower rate of interest. We have loans with 8/9%, of the same, if not lower quality than previous loans that have offered 12%
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daveb4
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Post by daveb4 on Feb 19, 2017 8:42:36 GMT
SS are offering 8 percent loans because there is a line of suckers investors a mile long who will fund them, simple as that. They have said as much on this forum, though using different words. They have no need to "stop the gaming" to get a couple of days free interest, though that will happen at the end of the month anyway. I'm a sucker then. Even as we speak there are people talking about leaving SS because the lower rates than before. I find this bizarre because if you have money to invest today you need to look at what on offer today - balancing loan risk, platform risk, reward and availability. So while I regret the lowering of rates/increase in risk that is happening all the way from savings accounts, mortgages and P2p, some of the eight percenters still make sense imho, and some of the 12%-ers don't. Jack P 'balancing loan risk, platform risk, reward and availability.' Absolutely! I would much rather have a 10%er at 60% LTGDV than a 12%er at 75%. Ok if i can take the 12% and guarantee to sell before sales risk then great - eg SS instead of some other platforms where it is impossible or difficult to sell. Realistically over last 6 months we all know risk has gone up on average and rates down. It is up to individuals to see what risk/reward they are happy with moving forward. The most amazing thing to me is the amount of people on SS or any other site who have their entire portfolio of P2P and in some cases total savings just on one site. This is serious risk - I look at a platform if it goes down could loose me 50% of portfolio - eg portfolio gets transferred to another provider with no second market and borrowers are not challenged too much if things go wrong. My main concern is FRAUD however either from the platform or more specifically my password being stolen or cash taken out of account. This is a 100% loss risk. Unlikely I appreciate but in these days possible. There are plenty of IT guys on here that know the IT on some of these platforms is not the same as banks (and banks have been hacked) I have funds in 6 different sites earning just over 10% on average which I am happy with and if there is a worst case scenario on my account maximum I loose is about 22%. All eggs in one basket for an extra 1/2% no matter how good the platform = not worth it to me
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r1200gs
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Post by r1200gs on Feb 19, 2017 9:08:04 GMT
I'm a sucker then. Even as we speak there are people talking about leaving SS because the lower rates than before. I find this bizarre because if you have money to invest today you need to look at what on offer today - balancing loan risk, platform risk, reward and availability. So while I regret the lowering of rates/increase in risk that is happening all the way from savings accounts, mortgages and P2p, some of the eight percenters still make sense imho, and some of the 12%-ers don't. Jack P I don't think the problem is so much that there are 8% loans. It is, in my opinion, the fact that Saving Stream said they would be taking on better quality loans and to do that would need to offer a lower rate of interest. We have loans with 8/9%, of the same, if not lower quality than previous loans that have offered 12% Or in other words, we are getting 12 percent loans for 8 percent, because there are people who will fund them. SS said themselves that they were reducing rates because loans were massively oversubscribed. I don't remember the exact words they used, but that's certainly what they meant. I certainly don't need any lectures on how an 8 percent loan can be better than one at 12 percent, I know. The issue here is that these are not better quality and safer loans, it's the same old at lower rates due to "investor" demand.
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r1200gs
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Post by r1200gs on Feb 19, 2017 9:13:13 GMT
I'm a sucker then. Even as we speak there are people talking about leaving SS because the lower rates than before. I find this bizarre because if you have money to invest today you need to look at what on offer today - balancing loan risk, platform risk, reward and availability. So while I regret the lowering of rates/increase in risk that is happening all the way from savings accounts, mortgages and P2p, some of the eight percenters still make sense imho, and some of the 12%-ers don't. Jack P 'balancing loan risk, platform risk, reward and availability.' Absolutely! I would much rather have a 10%er at 60% LTGDV than a 12%er at 75%. Ok if i can take the 12% and guarantee to sell before sales risk then great - eg SS instead of some other platforms where it is impossible or difficult to sell. Realistically over last 6 months we all know risk has gone up on average and rates down. It is up to individuals to see what risk/reward they are happy with moving forward. The most amazing thing to me is the amount of people on SS or any other site who have their entire portfolio of P2P and in some cases total savings just on one site. This is serious risk - I look at a platform if it goes down could loose me 50% of portfolio - eg portfolio gets transferred to another provider with no second market and borrowers are not challenged too much if things go wrong. My main concern is FRAUD however either from the platform or more specifically my password being stolen or cash taken out of account. This is a 100% loss risk. Unlikely I appreciate but in these days possible. There are plenty of IT guys on here that know the IT on some of these platforms is not the same as banks (and banks have been hacked) I have funds in 6 different sites earning just over 10% on average which I am happy with and if there is a worst case scenario on my account maximum I loose is about 22%. All eggs in one basket for an extra 1/2% no matter how good the platform = not worth it to me You should also consider the possibility of fraud by the borrower. One borrower (no names, no platform mentioned) has spent his life defrauding people and I have no doubt it is not going to end well for the platform or the lenders.
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Post by supernumerary on Feb 19, 2017 9:22:15 GMT
I have funds in 6 different sites earning just over 10% on average which I am happy with and if there is a worst case scenario on my account maximum I loose is about 22%. All eggs in one basket for an extra 1/2% no matter how good the platform = not worth it to me. Thank you for taking the time to post those wise words to us all.
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Jeepers
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Post by Jeepers on Feb 19, 2017 9:22:30 GMT
The only way 8% would work for me would be in the IFISA. Otherwise just not worth the net gain.
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ablender
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Post by ablender on Feb 19, 2017 12:02:24 GMT
I cannot understand how this would work. Can you please elaborate? My whole portfolio is 12%, it would be pointless prefunding an 8% loan, earning free interest for a couple of days as I'd then have to sell one of my 12% loans in a day or two to clear the negative balance. I kept on thinking about it and still cannot understand the whole logic if I look at the whole picture. So if I had a loan paying 8% (which I don't as a matter of principle) and I prefund another loan at 8% and then get what you call the free interest and then I sell my previous 8%er, your logic fails. Game still on.
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ablender
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Post by ablender on Feb 19, 2017 12:04:53 GMT
The only way 8% would work for me would be in the IFISA. Otherwise just not worth the net gain. It is not worth it for me not even in IFISA. IFISA is meant for lenders to save on their tax bill not for platforms to rake that saving for themselves.
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ablender
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Post by ablender on Feb 19, 2017 12:07:20 GMT
I don't think the problem is so much that there are 8% loans. It is, in my opinion, the fact that Saving Stream said they would be taking on better quality loans and to do that would need to offer a lower rate of interest. We have loans with 8/9%, of the same, if not lower quality than previous loans that have offered 12% Or in other words, we are getting 12 percent loans for 8 percent, because there are people who will fund them. . . . We have seen this happening elsewhere. in particular LC where people are happy to bit massive sums at the lower end of the interest rates. Reason??? Have no idea except perhaps to scare people away by not making it worth their while. In the long run if they succeed in reducing the number of people lending on P2P who is going to win?
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ablender
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Post by ablender on Feb 19, 2017 13:35:39 GMT
Sorry but I find this thread mostly bizarre. I'm not a saving stream fanboy like some on this thread used to be yet the moves SS have made recently look positive to me. Removal of INPL was always going to happen sooner or later, tightening of default handling, documentation of such, SS only paying the interest for a certain documented period, some moves to improve PR, a choice of rates or risk/return are all good for me. The SM is starting to look more sane - people are being more careful maybe but it's still moving even if you now need to wait a little while to sell some stuff. Sure there's good opportunities elsewhere and I'll be lending elsewhere also but SS is still one of my primary platforms and I'm very glad it's available. You claim you are not an SS fanboy but still have it as one of my primary platforms. Talking about myself, I do not dream of using a platform as a primary if I am not happy with it. This does not mean that I will not speak out my mind if I see something to talk about. You also mention the choice of rates and the risk/return issue. It is coming across to me that you fail to appreciate what many people are mentioning, and I agree, that the lower rates do not necessarily reflect a lower risk and most often do not.
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adrianc
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Post by adrianc on Feb 19, 2017 18:48:08 GMT
You claim you are not an SS fanboy but still have it as one of my primary platforms. Talking about myself, I do not dream of using a platform as a primary if I am not happy with it. There's a world of difference between being a satisfied customer, and being a fanboy. Fanboys will hear no bad said, at all, no matter how overwhelming the evidence.
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