markr
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Post by markr on Aug 23, 2017 17:18:28 GMT
Given the new autobid will only buy £100 max size pieces what happens to all the older £100+ size pieces if the owner want to sell their portfolio ? Are FC going to cut up all the £100+ parts into smaller chunks ? I wonder how many of those infamous £960 loan parts are floating around in the system.
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daveb4
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Post by daveb4 on Aug 23, 2017 20:29:40 GMT
This new system will allow further lack of DD. My concern is future domino effect when bad lending let's too many businesses go down the pan. Irresponsible lending?
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blender
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Post by blender on Aug 23, 2017 21:10:40 GMT
You would think that, given this is a compulsory process, the sale of part of a portfolio would be managed to maintain max diversity. With Autobid buying more than one part in a loan, max £100, they should plan to keep at least one part in as many loans as possible. Given the new autobid will only buy £100 max size pieces what happens to all the older £100+ size pieces if the owner want to sell their portfolio ? Are FC going to cut up all the £100+ parts into smaller chunks ? I think we have until Sept 18 to dispose of any large parts to someone who will hold them to term. Very odd to remove liquidity completely for parts which may well have been bought under the present Autobid system. An Autobid customer might reasonably complain.
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Post by crowdmember on Aug 23, 2017 21:46:47 GMT
I will be out of here now (as soon as I work out how!).
My biggest emotion is disappointment, there was a chance for FC to do things right, by allowing the crowd to spend time on analysing smaller companies, where the banks and other institutions cannot afford the analysis time ,given the modest returns on small loans.
But it is appears that a commitment to headlong pursuit of growth at FC could not be matched with the more patient timing of proper loan analysis. So anybody can get a loan and a great number of requests are classed as A or A+, when it seems as plain as a pikestaff to financially literate investors that there is are no way to accord them such a high rating.
So we now move to a toxic situation where the analysts and sellers of loans have no liability for their decisions beyond some aggravation. In the "Big Short"'s recounting of the 2008 crisis we saw weak mortgages being aggregated so as to sell with a high rating. Does anyone else think this has a familiar smell?
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fp
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Post by fp on Aug 23, 2017 22:32:25 GMT
Well thank you for dropping by I'll be popping over later to have a look around the Assetz house and see if it's to my liking. 
Well, I've been residing in the AC house since it was a new build and so far not a single penny of mine has fallen through the floorboards. But, to return to FC, do we know for sure whether we would get to see any details of the loans chosen for us? Wouldn't it be 'fairer' and simpler for FC to lump all the loans in the chosen box together, work out the overall gain/loss on a rolling basis and divide that between the 'investors'. That's got to be a lot easier than allowing said 'investors' to kick up a fuss if the algorithm allocates them more than the average number of duds and they end up earning less than the mean, assuming we know what the mean is. FCIF
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Post by hermitroad on Aug 23, 2017 22:45:22 GMT
I will be out of here now (as soon as I work out how!). My biggest emotion is disappointment, there was a chance for FC to do things right, by allowing the crowd to spend time on analysing smaller companies, where the banks and other institutions cannot afford the analysis time ,given the modest returns on small loans. But it is appears that a commitment to headlong pursuit of growth at FC could not be matched with the more patient timing of proper loan analysis. So anybody can get a loan and a great number of requests are classed as A or A+, when it seems as plain as a pikestaff to financially literate investors that there is are no way to accord them such a high rating. So we now move to a toxic situation where the analysts and sellers of loans have no liability for their decisions beyond some aggravation. In the "Big Short"'s recounting of the 2008 crisis we saw weak mortgages being aggregated so as to sell with a high rating. Does anyone else think this has a familiar smell? That is an excellent point regarding the Big Short. Though I guess they are working on big margins if the target rate is 7% while they're charging borrowers well over that. They'll be able to afford a lot of defaults. Also, you've expressed my views much more accurately than I could have done myself on the emotional response. Disappointment is about right.
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adrian77
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Post by adrian77 on Aug 24, 2017 6:21:10 GMT
In a word "yes"and it pongs. In fact this has the potential to be even worse as it is basically a junk gilt stock of unsecured loans and I firmly believe p2p is here to stay (thankfully) but in the short-term there will be a major correction as too many companies are piling into this business without thinking through the business model -not dissimilar to what happened 2008!
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Post by TomBola on Aug 24, 2017 10:42:17 GMT
As we move towards this new world of fluffy kittens and fairness, I've decided to not accept the new Ts & Cs and just let my loans run down.
In preparation for this (and while I still can), I've been identifying which loans won't be staying with me after Sept 18th, selling them at a small premium or lobbing them at par into the jaws of Autobid.
In slimming down my loans, I've unwittingly moved from a diversified portfolio to a non-diversified one. (According to the summary page my exposure to any one business is >1%). This wasn't my intention at all.
Some of my favoured loans must have been taken out by the same borrower, but there seems to be no way of identifying which. There is no Borrower ID in any of the reports or downloads. Even the loan book doesn't include this.
Am I missing something?
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Post by spiker on Aug 24, 2017 10:52:20 GMT
Yes you are: This figure is based on the total currently invested If you have £2000 invested in total across 100 business then your diversification is 1% (20/2000*100) If you sell 10 loans parts (10*20 = £200) , then your remaining diversification will be 1.11% (£20/£1800 * 100) but in theory you're not really any worse off than you were before.
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kaya
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Post by kaya on Aug 24, 2017 11:11:22 GMT
If you accept the new terms and conditions, does that mean that all repayments after 18th September will be automatically lent out? Will you be able to switch this auto-lending off again after that date?
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Post by TomBola on Aug 24, 2017 11:14:27 GMT
Yes you are: This figure is based on the total currently invested If you have £2000 invested in total across 100 business then your diversification is 1% (20/2000*100) If you sell 10 loans parts (10*20 = £200) , then your remaining diversification will be 1.11% (£20/£1800 * 100) but in theory you're not really any worse off than you were before. Thanks for that – I understand your reasoning. Using my actual figures….. Currently lending to 142 businesses (143 loan parts)
Your maximum exposure to any one business is 1.5% of your current amount lent.
As all my loans are about the same size and all of my loan parts relate to different loans, so if I could just find out which business I have given 2 loans to, I could remediate this easily. I don’t see how I can identify the business and therefore the loan I need to sell.
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blender
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Post by blender on Aug 24, 2017 11:24:19 GMT
Currently lending to 142 businesses (143 loan parts)
Your maximum exposure to any one business is 1.5% of your current amount lent But we're not going to let you know which business - tough.
Leave it Tombola - they're not worth it!
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p2p2p
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Post by p2p2p on Aug 24, 2017 11:56:38 GMT
I moved out of FC and am just left with bad debt and downgraded loans, I have nothing to sell. If I leave AutoBid off, will the recoveries trickle into my account as cash which I'll be able to withdraw every few months for the next 5 years, or will it be autobidded back into the system after September 18?
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Post by longjohn on Aug 24, 2017 12:15:24 GMT
As all my loans are about the same size and all of my loan parts relate to different loans, so if I could just find out which business I have given 2 loans to, I could remediate this easily. I don’t see how I can identify the business and therefore the loan I need to sell. Go to My Loan Parts and click on each loan. Make a note of the borrower name. You'll soon find it. I keep a spreadsheet with the following info - Loan number Part number (added once I've got it) Company name Company age Promotion (just says 'none' now but used to have the percentage bonus) Risk Interest Rate Term Amount Credit score (sum of scores shown divided by 12. If downward trend then halved the result) Turnover Turnover trend (up same or down) Profits (ratio of P to T) Profits trend (up same or down) Assets (ratio of A to T) Asset stripper (do they withdraw all their profits as dividends leaving a token sum here) Last annual account date Account age (calc from today minus the account date) Term remaining Principle left Principle returned Interest received FC fees Status Notes (anything I think is relevant.) A few of these items are hand written (copy and paste mostly) but most are imported from the Loan Parts (daily) and Statements (weekly) csv's downloads. It's all done with Excel vba. A couple of button clicks and everything is imported and calculated. When I want to get some cash I can click another macro which highlights the weakest loans based on the above info. I'm completely out now. Just got the defaults left which are repaying a few pence a month. J
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Post by beeje13 on Aug 24, 2017 12:18:49 GMT
I moved out of FC and am just left with bad debt and downgraded loans, I have nothing to sell. If I leave AutoBid off, will the recoveries trickle into my account as cash which I'll be able to withdraw every few months for the next 5 years, or will it be autobidded back into the system after September 18? You still need to turn auto-bid on. If it's off for you now they won't switch it on come 18th September. Even after that I imagine you can turn reinvestment off, but I can't confirm.
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