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Post by Ace on Dec 22, 2020 21:16:45 GMT
What it means is no losses for those at the front of the queue. tis always thus in the rush to the exit but IMO it's not right that the lucky (sorry, quick) ones also get their interest if the unlucky (sorry, slow) ones lose capital. BTW I say this as a very quick one, having all my capital out even before the restrictions. What it means is no losses for those at the front of the queue, and no *current* expectation of losses for those at the end of the queue either. If there were an expectation of losses for those at the end of the queue, they wouldn't be paying interest now. The trouble with that is that RS's "expectations" have proven to be rather unreliable. When they cut interest rates in half they "expected" that it would restore the ICR from 74% back to 100% by the end of this year. We'll, there's not long to go and so far the ICR has reduced to 68%. And we haven't had the expected furlough ending issues yet.
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littleoldlady
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Post by littleoldlady on Dec 22, 2020 22:51:35 GMT
What it means is no losses for those at the front of the queue. tis always thus in the rush to the exit but IMO it's not right that the lucky (sorry, quick) ones also get their interest if the unlucky (sorry, slow) ones lose capital. BTW I say this as a very quick one, having all my capital out even before the restrictions. What it means is no losses for those at the front of the queue, and no *current* expectation of losses for those at the end of the queue either. If there were an expectation of losses for those at the end of the queue, they wouldn't be paying interest now. Just look at their own stats and do the math. Even if you assume future calls on the PF will be the same as historically it will not be enough. And it is a heroic assumption that things wont get worse.
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Post by RateSetter on Dec 23, 2020 8:59:40 GMT
Good morning. Yesterday we delivered £3.7m and the full update is below:
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star dust
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Post by star dust on Dec 23, 2020 11:06:29 GMT
Assume they've caught up with their payments by now as the withdrawal of my 85% RYI from yesterday evening was in my bank account by close of play today.
Unfortunately, RS still haven't released the remaining 15% of my RYI though which is still marked as 'pending' despite approximately £4m of RYI releases today I had a "stuck" RYI a while ago. After about 10 days I contacted them and they released it, so it's not the first time. We've seen delays mentioned on the RYI thread, but my interest was in the timescales. Your post prompted me to ring them. Actually I was more concerned about it being released tomorrow and thus having a long weekend before return to my bank account than anything else, and that might still happen. Anyway I was told that it happens quite frequently (guess it's those loans repaying the day of RYI fulfilment) it would normally clear itself within a few days but it can get stuck and if it goes on longer than 4/5 then ringing RS will enable them to alert the technical team to get it cleared. Interest continues to be accrued whilst it's stuck.
In Edit: I've received an emailed update from RS this afternoon saying the remainder of my RYI "will be released by mid-next week" - so that's rhubarb to me then
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coogaruk
Hello everyone! Anyone remember me?
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Post by coogaruk on Dec 23, 2020 12:56:07 GMT
What it means is no losses for those at the front of the queue. tis always thus in the rush to the exit but IMO it's not right that the lucky (sorry, quick) ones also get their interest if the unlucky (sorry, slow) ones lose capital. it might not be right but life isn't fair. the queue is moving faster and so far things look strong. Those investors who do not engage or react, respectfully after 9 months should check on their investments. If they were purely to slow to the scene but did engage - well that is dam* bad luck. Not everyone will win. but so far losses are 0 and the fund is intact. interesting times Investors? I'm sure there are some who are still firmly of the opinion that RS is a savings account!
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beagle
Investor in ratesetter, funding circle, lendy (lesson learnt) and AC
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Post by beagle on Dec 23, 2020 14:35:18 GMT
it might not be right but life isn't fair. the queue is moving faster and so far things look strong. Those investors who do not engage or react, respectfully after 9 months should check on their investments. If they were purely to slow to the scene but did engage - well that is dam* bad luck. Not everyone will win. but so far losses are 0 and the fund is intact. interesting times Investors? I'm sure there are some who are still firmly of the opinion that RS is a savings account! Well good luck to them too. I can only suggest greater due diligence.
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Post by Ace on Dec 23, 2020 20:29:55 GMT
Investors? I'm sure there are some who are still firmly of the opinion that RS is a savings account! Well good luck to them too. I can only suggest greater due diligence. Greater due diligence is definitely needed. There are currently thousands of pounds of bids from lenders on the 1 year market below 1%, some as low as 0.2%!!! Utter madness.
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sl75
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Post by sl75 on Dec 23, 2020 20:35:14 GMT
What it means is no losses for those at the front of the queue, and no *current* expectation of losses for those at the end of the queue either. If there were an expectation of losses for those at the end of the queue, they wouldn't be paying interest now. Just look at their own stats and do the math. Even if you assume future calls on the PF will be the same as historically it will not be enough. And it is a heroic assumption that things wont get worse. They already do the maths for you - giving a coverage ratio sufficient to cover all the capital and more than 50% of the interest.
This will only have improved after £120M of loans were "unexpectedly" repaid early (or recovered early if some of the loans included in the sale had already been repaid to us by the PF), with updated stats to be published in due course. It seems quite likely that the PF got a significant boost from this sale both from reduced coverage and a direct cash injection.
A common mistake is to assume that a default represents the point at which a loss occurs. This is perhaps reinforced by the approach some other platforms take of avoiding declaring a default until all other recovery options have been pursued in full, so that most defaults on those platforms do represent losses.
For RateSetter's loan book, a significant proportion of defaults would be loans that will be repaying in full, but over an extended timescale. As there are many such historic loans, this should be expected to give a inflows of cash into the PF above and beyond the contributions made by ongoing loans. In my experience P2P recoveries continue for many years after the point of default, and RateSetter already has several years' worth of past defaults, at least a few of which will be recovering cash into the PF each month.
As I see it, if the PF were to run out of cash, that merely represents a delay, not a loss; in any loan book in "wind-down" there will eventually come a point where ongoing recoveries exceed new defaults. Under RateSetter's model, that would allow catching up with some payments the PF had not been able to make immediately they were due.
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Post by Ace on Dec 23, 2020 21:07:29 GMT
Just look at their own stats and do the math. Even if you assume future calls on the PF will be the same as historically it will not be enough. And it is a heroic assumption that things wont get worse. They already do the maths for you - giving a coverage ratio sufficient to cover all the capital and more than 50% of the interest.
This will only have improved after £120M of loans were "unexpectedly" repaid early (or recovered early if some of the loans included in the sale had already been repaid to us by the PF), with updated stats to be published in due course. It seems quite likely that the PF got a significant boost from this sale both from reduced coverage and a direct cash injection.
A common mistake is to assume that a default represents the point at which a loss occurs. This is perhaps reinforced by the approach some other platforms take of avoiding declaring a default until all other recovery options have been pursued in full, so that most defaults on those platforms do represent losses.
For RateSetter's loan book, a significant proportion of defaults would be loans that will be repaying in full, but over an extended timescale. As there are many such historic loans, this should be expected to give a inflows of cash into the PF above and beyond the contributions made by ongoing loans. In my experience P2P recoveries continue for many years after the point of default, and RateSetter already has several years' worth of past defaults, at least a few of which will be recovering cash into the PF each month.
As I see it, if the PF were to run out of cash, that merely represents a delay, not a loss; in any loan book in "wind-down" there will eventually come a point where ongoing recoveries exceed new defaults. Under RateSetter's model, that would allow catching up with some payments the PF had not been able to make immediately they were due.
The idea that RS won't have factored in an optimistic view of any recoveries from defaulted loans into their expected future PF income seems extremely unlikely to me. Long before covid struck they tried every trick in the book to massage the figures to try to hit their target 150% ICR figure. They finally gave in and simply reduced the target to 125% without any satisfactory justification other than that they couldn't hit the previous target. They soon found that they couldn't hit this figure either. It was down to 120% by Jan 2020. Interest Rate haircuts were on the way before covid hit. Covid just sped things up a bit and gave them an excuse. Also, they have sold off large chunks of defaulted loans, so will no longer be entitled to any recoveries.
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littleoldlady
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Post by littleoldlady on Dec 23, 2020 21:39:01 GMT
Just look at their own stats and do the math. Even if you assume future calls on the PF will be the same as historically it will not be enough. And it is a heroic assumption that things wont get worse. They already do the maths for you - giving a coverage ratio sufficient to cover all the capital and more than 50% of the interest.
This will only have improved after £120M of loans were "unexpectedly" repaid early (or recovered early if some of the loans included in the sale had already been repaid to us by the PF), with updated stats to be published in due course. It seems quite likely that the PF got a significant boost from this sale both from reduced coverage and a direct cash injection.
A common mistake is to assume that a default represents the point at which a loss occurs. This is perhaps reinforced by the approach some other platforms take of avoiding declaring a default until all other recovery options have been pursued in full, so that most defaults on those platforms do represent losses.
For RateSetter's loan book, a significant proportion of defaults would be loans that will be repaying in full, but over an extended timescale. As there are many such historic loans, this should be expected to give a inflows of cash into the PF above and beyond the contributions made by ongoing loans. In my experience P2P recoveries continue for many years after the point of default, and RateSetter already has several years' worth of past defaults, at least a few of which will be recovering cash into the PF each month.
As I see it, if the PF were to run out of cash, that merely represents a delay, not a loss; in any loan book in "wind-down" there will eventually come a point where ongoing recoveries exceed new defaults. Under RateSetter's model, that would allow catching up with some payments the PF had not been able to make immediately they were due.
Yes but they use an unexplained and ISTM a highly optimistic factor for future expected defaults. Try calculating using the historic ratio - which can be easily derived from their own stats.
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beagle
Investor in ratesetter, funding circle, lendy (lesson learnt) and AC
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Post by beagle on Dec 23, 2020 22:09:45 GMT
They already do the maths for you - giving a coverage ratio sufficient to cover all the capital and more than 50% of the interest.
This will only have improved after £120M of loans were "unexpectedly" repaid early (or recovered early if some of the loans included in the sale had already been repaid to us by the PF), with updated stats to be published in due course. It seems quite likely that the PF got a significant boost from this sale both from reduced coverage and a direct cash injection.
A common mistake is to assume that a default represents the point at which a loss occurs. This is perhaps reinforced by the approach some other platforms take of avoiding declaring a default until all other recovery options have been pursued in full, so that most defaults on those platforms do represent losses.
For RateSetter's loan book, a significant proportion of defaults would be loans that will be repaying in full, but over an extended timescale. As there are many such historic loans, this should be expected to give a inflows of cash into the PF above and beyond the contributions made by ongoing loans. In my experience P2P recoveries continue for many years after the point of default, and RateSetter already has several years' worth of past defaults, at least a few of which will be recovering cash into the PF each month.
As I see it, if the PF were to run out of cash, that merely represents a delay, not a loss; in any loan book in "wind-down" there will eventually come a point where ongoing recoveries exceed new defaults. Under RateSetter's model, that would allow catching up with some payments the PF had not been able to make immediately they were due.
Yes but they use an unexplained and ISTM a highly optimistic factor for future expected defaults. Try calculating using the historic ratio - which can be easily derived from their own stats. you can use the past, future or both but you it won't ever be perfect otherwise we would all be mega rich. in this case the past is not helpful as the past has never had circumstances like this before. All investing advises - past performance is no indication of future.
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Post by Badly Drawn Stickman on Dec 23, 2020 22:17:32 GMT
I had a "stuck" RYI a while ago. After about 10 days I contacted them and they released it, so it's not the first time. We've seen delays mentioned on the RYI thread, but my interest was in the timescales. Your post prompted me to ring them. Actually I was more concerned about it being released tomorrow and thus having a long weekend before return to my bank account than anything else, and that might still happen. Anyway I was told that it happens quite frequently (guess it's those loans repaying the day of RYI fulfilment) it would normally clear itself within a few days but it can get stuck and if it goes on longer than 4/5 then ringing RS will enable them to alert the technical team to get it cleared. Interest continues to be accrued whilst it's stuck.
In Edit: I've received an emailed update from RS this afternoon saying the remainder of my RYI "will be released by mid-next week" - so that's rhubarb to me then In a slightly bizarre exchange of emails today, where I was trying to sort out an ISA transfer problem and they seemed committed to telling me things I was not asking.... I was informed my access RYI would be released in the middle of next week which given the one on that account is over 10000 back in the queue may (or may not, given the odd crossing of wires) be good news for anybody in that range. I did wonder at some point if some of the 'lender facing' staff have worked out they may not have a long term career with RS (not something I would wish on anybody) and have just lost interest in sticking to the script. It all reached my boredom point anyway and I have just put my 'problem' on the back burner till sometime early next year the way things are going I may have plenty of new ISA allowance spare next year anyway. Edit.... A little hard to believe but I just did a release request on a lingering £10 max holding and it gave me a queue position of 16440 which would suggest that is the current length. I am surprised by that
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Post by RateSetter on Dec 24, 2020 9:29:59 GMT
Good morning. Yesterday we delivered £3.6m and the full update is below. The next update will be on Tuesday 29th December.
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aju
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Post by aju on Dec 24, 2020 15:10:33 GMT
I'm not sure that selling with an RYI request actually goes straight back to investments, certainly not my experience with RYI's i've got returned. I'm happy to be corrected on that but that was not my experience with the 5Y or the 1Y sales before one was allowed to set return to holding as an option. I would also have expected that RS would get quite a bit of flack from the regs if that were the case though. No, what I am saying is that when a borrower repays a loan the proceeds go straight back on the market with no way for the lender to stop it. (S)he can theoretically then cancel it if (s)he's quick enough but that is practically impossible if her required rate is left at default as her funds will be immediately matched. This will happen even if the lender is in the RYIQ herself. In the first several months of the RYIQ this was probably the only source of funds to refund those at the front of the Q. This only applied to the APM markets. I also would have expected (or at least hoped) for some flack from the FCA but this just shows how useless they are.Whilst we were going through these differences I took the opportunity to poke RS and got the following responses recently ... (Initial question Sent via RS online help) A recent thread in the p2pif seems to suggest money returned from an RYI request in Access sector will be relent without my express permission is that correct - doesn't sound right to me.
Please advise accordingly, Regards ************(After this exchange I was still not comfortable this answered the whole story so I requested further clarification.) Hi ***********,
I have a subsidiary question in that if I set RYI to all my funds and whilst waiting for the funds to RYI, I've been waiting since May for Access RYI to go through, does non RYI returned funds still get relent or does the system take note that I want all funds returned and set relend off (I'm guessing not and if so has the FCA actually had any involvement in these types of settings, are they ok with that by chance).
Thanks for your help so far. Regards ********I'll leave it at that but it still beg's the question. Did the FCA even look at this that closely and in particular at this level of process. All that said in my own case and from experience I knew that the settings - at the time in all products - had no options to move returned funds directly to holding so I just followed what I had learnt elsewhere to make all lending under my control using higher default rates I was comfortable lending at and only ultimately selecting the highest rates should i not wish to lend again. (Also if the funds lent at least it would be at an exceptionally high performing rate although at times even those rates would be too high and the loans would just pay back within a day or so before any great returns were received ( not sure if that was RS closing them or the borrower controlling their rates!).
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littleoldlady
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Post by littleoldlady on Dec 25, 2020 10:46:16 GMT
You really have to prod RS to get them to admit what we on this forum already know. Lucky for those on this forum that a large proportion of lenders are unaware and until recently at least it was their loans being repaid by borrowers that were being used to buy loans from the front of the RYIQ even if they were also in the RYIQ themselves. Pity the poor suckers. Some will say all's fair in love and investments but it is surely the job of the FCA to stop this type of malpractice.
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