Another graph...trying to get a feel for loan pay offs:

Loans Paid Off.png

Blue: Number of loans (held in month)
  • shows my initial ~3 month 'buy in' period
  • followed by slow increase due to reinvestment of interest over time
  • more recent slight decrease as I purchase more notes per loan (so number of loans decreasing)


Orange: Loans paid off (in month)

  • appears to lag number of loans by around 6 months (i.e. significant loans paid off at ~6 months)
  • first, large peak - most likely due to the interest rate adjustment in Aug/17 that saw a huge fall in rates (so wise borrowers rewriting loans)
  • second, smaller peak, not sure, (i) an 'echo' 6 months on from the first peak or (ii) a post Christmas anomaly? (probably an 'echo')


Notes:
  • I'll continue to purchase more notes per loan, which should see the overall loan number drop, and 'workload' (reinvesting rewrites) reduce.
  • A general view of paid off loans, for me, appears to be a pay off rate of around 5-6% of loans per month, so 60-70% of loans rewritten each year.
  • Difficult to see the trend, but I'm not liking the slow rise toward the end