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Post by GSV3MIaC on Aug 21, 2017 15:29:35 GMT
'Fair' means 'the same as other lenders' ... not anything else.
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nrw
Posts: 61 
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Post by nrw on Aug 21, 2017 15:34:45 GMT
How can the auto bid be fair. This means I'll be getting the poor loans from companies that are reporting losses or the companies that have 2 others loans already. I don't want that. The autobid will purchase an even spread of the loans in the market, all other things remaining equal. If you don't want that, then FC clearly isn't the platform for you moving forwards. However, this will benefit the majority of investors moving forwards, making it fairer for the majority / less sophisticated - which it's difficult to argue against.
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nrw
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Post by nrw on Aug 21, 2017 15:41:51 GMT
How can the auto bid be fair. This means I'll be getting the poor loans from companies that are reporting losses or the companies that have 2 others loans already. I don't want that. The above implies that you want to invest the time in purchasing better loans than average, necessarily requiring that someone on the other side must have worse loans than average. This is not fair.
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Post by thewizard on Aug 21, 2017 16:03:41 GMT
Actually I wonder how some of the loans make it onto FC and if someone thinks buying a loan on a company with negative profit is a good idea then let them take it. Why should we all suffer as a result.
That's like saying I put £2 in the lottery and didn't win and I think all the money should be distributed throughout everyone.
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nrw
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Post by nrw on Aug 21, 2017 16:18:18 GMT
Actually I wonder how some of the loans make it onto FC and if someone thinks buying a loan on a company with negative profit is a good idea then let them take it. Why should we all suffer as a result. That's like saying I put £2 in the lottery and didn't win and I think all the money should be distributed throughout everyone. If you don't believe in FC's loan origination strategy then you shouldn't invest on FC. FC's strategy is to treat all lenders equally, fairly - something which is demanded by the FCA if it is to continue marketing to retail investors. It is clearly now more akin to a fund than it is to a true market place - removing the option to self-select - a strategy which you may not choose to buy into, meaning that the platform is no longer for you. But it was definitely unfair to less sophisticated retail investors before (myself included), as a small number of 'cherry pickers' left the large number of autobidders with below average loans.
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bg
Member of DD Central
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Post by bg on Aug 21, 2017 16:23:11 GMT
How can the auto bid be fair. This means I'll be getting the poor loans from companies that are reporting losses or the companies that have 2 others loans already. I don't want that. The above implies that you want to invest the time in purchasing better loans than average, necessarily requiring that someone on the other side must have worse loans than average. This is not fair. Thing seem to be going very Jeremy Corbyn round here all of a sudden!
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nrw
Posts: 61
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Post by nrw on Aug 21, 2017 16:30:25 GMT
The above implies that you want to invest the time in purchasing better loans than average, necessarily requiring that someone on the other side must have worse loans than average. This is not fair. Thing seem to be going very Jeremy Corbyn round here all of a sudden! LOL - I'm trying to echo the understandable sentiments of the FCA, interested in protecting retail investors. Other platforms have chosen to close to retail investors and instead focus just on 'sophisticated investors' - such as LendInvest - providing far more flexibility on how investors are treated. I'm a raw capitalist, trust me!
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andyp
Stubborn Yorkshireman from the rhubarb triangle
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Post by andyp on Aug 21, 2017 16:32:24 GMT
I don't know about Corby, the way it looks FC are heading into full scale Diane Abbott numerical flim-flam.
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r00lish67
Member of DD Central
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Post by r00lish67 on Aug 21, 2017 16:33:01 GMT
FC's strategy is to treat all lenders equally, fairly - something which is demanded by the FCA if it is to continue marketing to retail investors. I'm not sure I buy the bit about the FCA demanding this change. FundingSecure and Ablrate to name but two are both open to retail investors and have self select ISA wrappers available with proper secondary markets. Granted, they're nowhere near as big a player as FC is, but still.
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michaelc
Member of DD Central
Say No To T.D.S.
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Post by michaelc on Aug 21, 2017 16:34:14 GMT
In what way will this platform be P2P?
Can I ask the moderators to consider either creating boards for Barclays, RBS, etc or removing FC from the forum?
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easylender
Member of DD Central
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Post by easylender on Aug 21, 2017 16:35:38 GMT
If the unsophisticated lenders had been made aware up-front that the odds were against them and that the returns they could expect were significantly below the average, then I think that would have been fair. But that was not the case. They were deceived.
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Post by barneywol on Aug 21, 2017 16:49:49 GMT
I was extremely disappointed with this morning's news. I don't use Autobid, as I prefer to look through the loan offers, more likely to invest in a tea-room in Penzance, say, than yet another startup IT consultants in London! :-) But seriously, one of my main gripes about Autobid is that the amount bid is specified as a percentage of your total investment. So even at the minimum 0.25%, if you have more than 16,000 invested, you will be stuck with £40 loan-parts, which will be very difficult to re-sell. I believe they really should allow us to specify a (maximum?) bid value.
And I'm appalled that I will no longer be able to specify individual loans that I want to sell. If a borrower is repeatedly late in their repayments, I will offload that loan. Is that unfair? I am not forcing anyone to take on my loan, just offering it up for sale. Others might be more willing to stick with it, especially if it is a high interest rate. But now I will be stuck with it, and if my fears come true and that company folds, then I'm stuck with the loss. Thanks!
I understand many people (the majority, by all accounts) just want to put their money in and forget about it. Fine, I can understand that, but there are those of us with more time on our hands that enjoy the manual selection process. There are any number of P2P companies that provide the automatic fund, but FC is rare in offering this different, manual, product.
There is talk about fairness. I don't know how the autobid system works, but if people using it weren't getting to the D and E risk loans, then surely that is a problem for the FC computer people to sort out with their system? They have acknowledged that some people might want very safe investments, so are offering the A/A+ only option, but as another commentator has said, they've not allowed those of us who want the higher risk/reward B-E loans the ability to opt out of A and A+ - something you can at least do now.
Property development loans seem to polarise opinion. I believe there are people who love them, and certainly when I've put up such loan-parts, they've been snapped up quickly. I can see the attraction, you are literally investing in bricks and mortar! When (and note I say "when" !) they are late repaying, they are charged an extra 2%, so it seems terrific. But I find them frustrating, keeping a record of what loans I have, these outstanding loans mess up the spreadsheet! :-)
There were things about their system that I would have liked to see tweaked, but this total change to the way it works is very unwelcome.
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michaelc
Member of DD Central
Say No To T.D.S.
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Post by michaelc on Aug 21, 2017 16:52:11 GMT
A guy from Funding Circle actually called me this morning because of the blog that I'd started (which is in effect pointless now). My points to him were: 1. FC will lose the input of manual investors who use the platform on a daily basis and can provide analysis and observations. While this will reduce servicing needs (and costs) I think it will have a negative effect in the long term because there will be less pressure on FC to improve or change things. There's no way autobid investors can provide the same level of feedback. He said customer feedback is still very important to them. 2. If the lack of feedback and criticism leads to a declining investment performance they can't change this very quickly as there will be up to a 5 year tail on some of the loans. I think the feedback is important because people are constantly talking about whether something should be an A loan or not or how their individual default processes are going. He said that they will be monitoring the performance as much as possible 3. He said that they still offer market leading returns. I disagreed. If you can get 5-6% on Ratesetter or Growth Street with a provision fund, then I think that is better than an uncertain estimated 4.8% or 7.5%. Lendy will give 9-12% on property which is better than an unsecured loan. 4. He said the main reason for the change was that FC considered it unfair that people in autobid couldn't access D or E loans in the primary market or had to pay a premium for them in the secondary market. I have 130 D or E loans and apart from one or two all of them came from the secondary market. Paying a premium was never a problem because you could still get over 17 or 21% which is not bad if you like the loan. More often than not you could get the premium back (or more) if you sold them later on. 5. My last point was that FC won't be fun any more. Reading about businesses, building up my own portfolio and looking for 'market inefficiencies' was the whole reason that I enjoyed using the platform. The response was that they still want people to have a direct relationship to their borrowers so although you can't choose who you've lent to, you can still see who is getting your money. He also said retail investing is still very important to FC because they don't want to rely on corporate money only (in the event of a downturn). I'm disappointed because I put a lot of effort into writing a book and building a blog. It hasn't been so active recently because I've been taking some time out to think about some of the changes I wanted to make. I did want to relaunch the book as well at some point but I guess there's no reason to now. Nothing I can do about it however and I've had a good run over the last year. I think I'll hold on to my existing portfolio for a few months then withdraw. Without that fun factor I'm not so interested in FC. Seeing my new loans in companies with awful finances or business descriptions that read "Need working capital." or "Need a loan for cashflow (= running out of money)" would be more of a fear factor than a fun factor for me. In terms of returns, I don't think they are worth the uncertainty compared to what you can get on other platforms. I'm also annoyed having wasted a small sum on your book! Still it kept me entertained over the past week or so.
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ilmoro
Member of DD Central
'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 Aug 21, 2017 16:53:50 GMT
In what way will this platform be P2P? Can I ask the moderators to consider either creating boards for Barclays, RBS, etc or removing FC fprom the forum? Same way as all the other platforms that dont allow self selection. Automated investment systems dont preclude it being p2p
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r00lish67
Member of DD Central
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Post by r00lish67 on Aug 21, 2017 16:54:39 GMT
I think we're all overlooking a key benefit of the simplification that this will introduce to investor communications. i.e the FC customer services team will now be freed and have the time to develop their other main other skill - from this:   To this:  Those that aren't culled in the relentless march to profitability that is. |
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