bigfoot12
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Post by bigfoot12 on Oct 30, 2015 12:29:56 GMT
16786 £30k 36 months 9.2% filled and rejected,
new loan same borrower ~£16k 24 months 9.2%??
Is this common? When do FC charge? Would have thought it better to take the larger longer loan and pay some back early if not needed. But maybe FC fees would make that uneconomical?
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blender
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Post by blender on Oct 30, 2015 13:45:46 GMT
FC take their fee in full on draw down, from the money advanced by lenders. No draw down, no fee. It is an essential feature of p2p that the operator takes no risk. The Borrower pays the fees rolled up as part of the loan, with the same interest rate. The borrower can repay early with no penalty, but FC have still had their full fee. They can waive fees in whole or part. It's usually the size of the monthly payments that a borrower is primarily concerned with, not the fee as such.
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bigfoot12
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Post by bigfoot12 on Oct 30, 2015 13:47:36 GMT
Thanks, but if the FC borrower rejects the loan before drawing it have they paid a fee?
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blender
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Post by blender on Oct 30, 2015 13:53:12 GMT
No fee. I edited the above to say 'no draw down no fee' while you were posting, probably. It also costs the borrower nothing to just let a full offer run for two weeks without having any intention of taking it (though they accept subject to contract after a week). This has to change imo.
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Post by goldservice on Oct 30, 2015 14:24:46 GMT
I had always thought that a fee was charged whether the loan progressed or not. The fact that so many loans are not a multiple of £1,000 was, I thought, because the fee had been added on. Where the loan amount is a multiple of £1,000, I thought that the fee had either been included in the amount requested or paid separately by the borrower.
If fees are chargeable on first application, then the borrower has to commit to paying the fee before discovering what risk band, and therefore what interest rate, will be assigned. If I was a borrower, I would not be happy with that.
If 'no drawdown, no fee', then the borrower can get the benefit without charge of an assessment by Financial Crafts of his/her ability to repay a loan - useful information.
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acky
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Post by acky on Oct 30, 2015 14:27:19 GMT
" ...... - useful information." .... or not!
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blender
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Post by blender on Nov 3, 2015 9:16:54 GMT
If proof of no 'draw down, no fee' is needed:
4. Fees
4.1 We charge a completion fee of 2-5% depending on the term and the risk grade assigned by us. This completion fee is included in the total charge for credit in the Key Contract Terms and is deducted from the amount borrowed before it is transferred to you so you will receive the amount borrowed less the completion fee.
It is a completion fee. The assessment, banding and 'auction' is free and comes with no obligation to proceed, or even to say you will not proceed. It just runs and times out.
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