michaelc
Member of DD Central
Say No To T.D.S.
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Post by michaelc on Jun 15, 2017 21:25:50 GMT
I was wondering how this might affect the fixed income and p2p market specifically? Presumably it mean interest rates will rise sooner but what does that mean for p2p loan rates?
I can't quite justify this, but I'm thinking in this climate of change, it might be safer to stick with relatively short dated loans. e.g. 6-9 months as opposed to 5 years?
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Post by corriefan on Jun 15, 2017 22:13:13 GMT
I think a lot of people will exit P2P if safer savings rates ever rise to a decent level. (Was that a flying pig?...)
I'm not an expert, but fewer lenders might mean P2P rates go higher. Who knows?
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dzo
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Post by dzo on Jun 16, 2017 22:30:10 GMT
I'd have thought this would push more people into p2p.
The BoE have just voted to keep base rate at 0.25% and they've said that when rates do rise it will be gradual. Money in the bank is depreciating in value so I can see a lot of people desperately looking for other places to put it.
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michaelc
Member of DD Central
Say No To T.D.S.
Posts: 5,710
Likes: 2,985
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Post by michaelc on Jun 17, 2017 16:11:44 GMT
I'd have thought this would push more people into p2p. The BoE have just voted to keep base rate at 0.25% and they've said that when rates do rise it will be gradual. Money in the bank is depreciating in value so I can see a lot of people desperately looking for other places to put it. Agree with that but I think they voted by a narrow margin. To me, that implies the rates will go up soon and faster than perhaps we hope for. In turn wouldn't that mean some folk who are financially stretched having to sell meaning more houses of the market leading to lower prices. That would result in our security and LTV being affected wouldn't it? At the same time if more lenders pile in to p2p, then p2p rates will go down leading to lower reward at higher risk. Perhaps all a bit pessimistic, but I guess like many I'm really wondering where to put cash right now.
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Post by valuehunter on Jun 17, 2017 16:51:14 GMT
I'd have thought this would push more people into p2p. The BoE have just voted to keep base rate at 0.25% and they've said that when rates do rise it will be gradual. Money in the bank is depreciating in value so I can see a lot of people desperately looking for other places to put it. Agree with that but I think they voted by a narrow margin. To me, that implies the rates will go up soon and faster than perhaps we hope for. In turn wouldn't that mean some folk who are financially stretched having to sell meaning more houses of the market leading to lower prices. That would result in our security and LTV being affected wouldn't it? At the same time if more lenders pile in to p2p, then p2p rates will go down leading to lower reward at higher risk. Perhaps all a bit pessimistic, but I guess like many I'm really wondering where to put cash right now. As interest rates rise I would think it's more likely the demand for P2P would decrease as the risk adverse segment of the market go back to bank accounts... I think you're right and a raise will come sooner than previously thought by most, though one of the members who voted in favour of raising leaves the MPC next month taking it down to 4-2.
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