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Post by beeje13 on Nov 9, 2017 18:20:58 GMT
Have the recent business loans come under the 'bespoke' auto lend? I don't have auto lend on for those, but I've manually allocated on 2/3 recent ones (missed out on today's).
I think UB would be crazy to stop new investors coming in to give bigger allocations to current lenders. It's not like Growth Street where the returns have dropped.
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Post by beeje13 on Nov 9, 2017 18:14:03 GMT
I got £50 when I opened my IFISA with them a few months ago.
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Post by beeje13 on Nov 9, 2017 10:19:49 GMT
Post count of 50?! (Sorry, just trying to get my post count up!) Arguably this is compelling proof of the need for a secondary market, where posts can be traded. I will leave others to decide on the model. This may be a good time to establish a 'secondary market think tank' (SMTT) to see if a private area is needed for these transactions to be carried out. As an afterthought, do posts on the secret 60 forum count? But will it have premium and discounts to increase liquidity?
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Post by beeje13 on Nov 3, 2017 17:45:34 GMT
I got 2 repayments, 8 allocations so far today.
I'm about 5 months into my Unbolted journey, so soon I think I won't have to put much money in at all when I start getting more regular repayments.
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Post by beeje13 on Nov 3, 2017 17:30:44 GMT
Yes, my account balance has been drained to near empty, I may have missed some allocations as a result
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Post by beeje13 on Nov 2, 2017 18:38:04 GMT
I was quite obvious for a while that they will rise by the end of this year. It had to happen to catch up with inflation and recent 0.25% rise in the US, but I don't think there will be another rise for years to come. The 'market' expects the rate to be 1% in three years time. But the US rate has gone from 0.5% to 1.25% since they started increasing last year.
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Post by beeje13 on Nov 2, 2017 16:30:56 GMT
But MPC say they are in no rush to raise again, which caused the £ devaluation today.
QE levels maintained. I'd like to see the levels of gilts held by the BoE allowed to fall, but what do I know!
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Post by beeje13 on Oct 30, 2017 18:44:51 GMT
In this scenario of an interest rate reduction, wouldn't you expect quite alot of withdrawals, reducing supply from the lending side and therefore cause rates to increase anyway, cancelling out an imposed rate reduction?
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Post by beeje13 on Oct 29, 2017 20:16:33 GMT
Withholding interest on loan parts up for sale would be something I'd support. Would reduce the amount available on the secondary market and should make it easier to sell because of this.
I wouldn't push for it though.
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Post by beeje13 on Oct 29, 2017 18:45:20 GMT
It's rallied from the low of 1.20 against the dollar, I wouldn't say it's on a downward trend.
And it was overvalued before brexit, now it's "cheap". Source: Regression analysis at Pyrford.
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Post by beeje13 on Oct 28, 2017 17:15:59 GMT
I think there is confusion between interest and capital here.
The coverage ratio that has been quoted is for the interest payments.
I repeat that the interest coverage ratio would have to fall to 0% before any CAPITAL losses occur.
There is another coverage ratio, for expected actual bad debt, called the capital coverage ratio. This currently stands at 278% of expected losses. This measure would need to fall to 100% before CAPITAL losses occur.
Hope that clears things up, it took a while for me to get my head around it.
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Post by beeje13 on Oct 28, 2017 10:25:53 GMT
It's concerning but I have a fair amount if confidence in RS. Things would have to get very bad (which is possible) for anybody to actually lose some of their capital, compared to Zopa for example which is happening to some lenders on there. The uncertainty is how they would respond to the coverage falling below 100%.
As I understand it, the bad debt calculation is supposed to be formulaic based on defaults of the loans made 18 - 30 months before, although this formula has been amended several times. It appears to calculate the % of O/S PF loans required for each year's loans monthly and then these %ages are applied until the next update. How this would operate if the number dropped below 100% remains to be seen. I think that there needs to be a formal decision by RS before interest & or capital is diverted from lenders to the PF. I am not at all sure how they would implement this if required.
The comforting picture of interest on existing loans being sufficient to cover shortfalls in most forseeable circumstances is unlikely to reflect what would actually happen. Key here is the cashflow requirements for the PF to continue to meet defaults as they occur, while ensuring reducing the disruption to RS's business.
The company operating the PF should push to ensure that they have sufficient funds as soon as possible especially as invoking this is likely to curtail the scale of RS's ongoing business and lead to a run on sales of existing loans and drying up of lender funds. Whether they agree to allow time to fill the deficit by a partial transfer of interest for an extended period or divert all payments for a short period to try and reestablish a viable service before the majority of lenders react remains to be seen.
Critical would be how RS attempt to continue in business. It could restart a new PF with a cash deposit to make new loans as attractive as possible (thereby preventing future contributions being used to mitigate the losses on existing loans as done to date) would be key. Personally I am expecting a capital haircut which is subsequently compensated by the remaining interest over subsequent years. It remains to be seen whether they would provide that any contribution by lenders directly to the PF is repayable if not subsequently required rather than carried forward to offset future loans.
- PM
The coverage ratio would have to fall to 0% before any capital 'haircut'/loss (not taking into account cashflow of course).
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Post by beeje13 on Oct 27, 2017 9:55:09 GMT
It's concerning but I have a fair amount if confidence in RS. Things would have to get very bad (which is possible) for anybody to actually lose some of their capital, compared to Zopa for example which is happening to some lenders on there.
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Post by beeje13 on Oct 26, 2017 14:54:54 GMT
I've also just received a "rate alert" email for the first time, which was quite nice.
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Post by beeje13 on Oct 24, 2017 18:44:08 GMT
I was really confused by that graph until I realised it said "FOREIGN inflows".
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