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Post by davee39 on May 4, 2014 20:02:55 GMT
Eg. 5956, £120k, looks like about 260 out of 300 loan parts are £20 at 0.3% markup, ie 1p profit + interest. Now I can understand wanting to shift an occasional over-investment, but this looks like flippers working on tiny margins at some risk, 100 parts would need to be shifted to earn £1. Am I missing something?
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fasty
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Post by fasty on May 4, 2014 20:11:12 GMT
I've often been guilty of doing the 0.3% too... It's typically the smallest premium on top of a £20 loan part that will let you sell it at some (albeit tiny) profit. Psychological boost that at least it's not being sold at a loss!
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Post by GSV3MIaC on May 4, 2014 22:38:49 GMT
Me too. If I got too many I'll list extras at 0.3%, before caving in and selling at par (I.e. 5p loss). Anything between 0 and 0.3% is pretty stupid IMO, but 0.3% often works. Buying them to sell at 0.3% .. Nope that's pretty dumb, unless you just wanted a temporary money park, and even that there's the 2% cash back fixed rate loans, if you are quick.
Of course someone is selling at 0.3%, then you have to match it or wait further down the queue .. Yet another race to the bottom.
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jimbo
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Post by jimbo on May 4, 2014 23:37:07 GMT
Probably flippers who were just after the 1% cashback and are now trying to sell down their over-exposure...
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Post by aloanatlast on May 5, 2014 5:12:54 GMT
No cashback on that one, it only ended on Thursday. Easter drought, too much money chasing not enough auctions.
Personally I haven't bought much since the second day of cashback. Still bidding hopefully, but rates going way too low. I thought, somebody is expecting secondary rates to slide, they must think things are getting back to "normal".
But with 5956 a lot of bidding was done in the last few minutes at 9.5% and 9.4% by people who must have been intending to sell straight away and knew that the SM wasn't biting below 9.3, if that. No I don't get it.
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spyrogyra
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Post by spyrogyra on May 6, 2014 13:42:11 GMT
Imagine a flipper has sold too many at 3% and now is not very keen to plow through the current low rates. If someone is riding the waves 3-4 times a year at 3% premium, buying & selling at 1p premium plus interest might be a good temporary option until the rates get higher again.
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markr
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Post by markr on May 6, 2014 14:39:52 GMT
If I've put a spread of bids on to try to catch the top rate when I can't watch an auction finish, I'll try to sell the lower end of the spread at 0.3%, especially if I've underestimated the finish rate and left myself over exposed. Usually can't sell them for any more markup since they'll be competing with the flippers who did get the top rate, but I'd rather keep them than make a loss so I offer them on a "you pay the fees you can have 'em" basis.
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