Harmoney

[Harvey Specter]

Finite - I have wondered that also but my rational is Harmoney base their statistics on a large sample. On the basis I only invest in a very small subset of that, I don't want to be over investing in ones that I don't think are a good risk. Eg if you had 1m notes, it might be OK to have 10% in Holidays, but if you only have 10 notes, I would prefer not to more than 1 (which I may get due to random selection) and preferably none.

Same - I'm not a fan of business loans on the basis of they are borrowing from Harmoney, they are likely to be one of the new businesses that doesn't make it, and if they lose their business, they also lose their job.

Having said those points, while I start out picky, I prefer to be fully invested so may invest (hopefully underweight) in what I think are suboptimal loans (ie. Trusting Harmoney). After all, I have had as many B write offs as F write offs.

[humvee]

Hi,
I'm new here, so please be gentle!

Why does everybody think that they are better able to determine risk than Harmoney who are professionals in consumer finance.
Harmoney have access to far more borrower information than we do and with their expertise create a credit rating (with associated default rate). So why would we, with just a small subset of the borrowers details, be able to do better than Harmoney?
I just accept Harmoneys ratings.

But what I do consider is loan term - I only invest in 36 month loans as there is no secondary market to provide an exit path.
And I have also been stung by rewrites and so I only invest in loans that are at the top limit (ie. can't be increased further) or are rewrites (on the assumption that it won't happen again)

I don't know but I suspect that 36 month loans might get more heavily hit with rewrites with people increasing borrowings and changing to 60 montloans so repayments don't increase.

[Lewylewylewy]

Hi,
I'm new here, so please be gentle!

Why does everybody think that they are better able to determine risk than Harmoney who are professionals in consumer finance.
Harmoney have access to far more borrower information than we do and with their expertise create a credit rating (with associated default rate). So why would we, with just a small subset of the borrowers details, be able to do better than Harmoney?
I just accept Harmoneys ratings.

But what I do consider is loan term - I only invest in 36 month loans as there is no secondary market to provide an exit path.
And I have also been stung by rewrites and so I only invest in loans that are at the top limit (ie. can't be increased further) or are rewrites (on the assumption that it won't happen again)

Let's compare it to online dating... There are 5000 women online, I filter them down to 1000 in my area. I filter them again to remove the the fatties, ones with kids, smokers and ones my age. I'm left with 120. I filter them again by Height because I want a cutie, leaving 50 that the dating websites statistical analysis thinks are ideal for me.

The reality is that these 50 statistically fine women are on a dating website for the same reason I am.. Because nobody wants to date a buck toothed psychopath, who has an edipus complex, smells inexplicably of cabbage and worst of all can't spell!

My point is a very important one: we're dealing with humans. People can be tricky, dishonest, unreliable, mentally ill and just plain stupid. Also the computer system is only working of the numbers it sees and needs a human to do the final check, just like a real loan company does (that's why you can't order a loan within 5 minutes throughout a bank, for example).

I sometimes wonder about the validity of some of the data. For example, if it looks at your monthly income based on transactions incoming to a borrowers account, does it know the difference between a car that was sold last month and salary?

PS: I don't really smell like cabbage.

[permutation]

I have read a number of times in the financial media regarding primary loans i.e.. housing loans; that a borrower having to pay more than 30% of their net income to service a mortgage could be putting themselves under financial stress.

I assume that many loans through Harmoney are additional to mortgage or rent payments.

How difficult over time would it be for a borrower to continue repaying a loan when in some bios I read, the "Repayment v Income ratio is 20-35%+? So total debt servicing could be as high as 55%+

I will never find out if some of these will default because I never invest in such loans.

Over the last 10 months with over 460 loans invested I have had 3 defaults in E, F grades only.
I have a graph of my investment spread in a previous post.

[lche059]

hi, does anyone know how to cancel an in-funding order, if it's possible? thanks.

[lche059]

Finite - I have wondered that also but my rational is Harmoney base their statistics on a large sample. On the basis I only invest in a very small subset of that, I don't want to be over investing in ones that I don't think are a good risk. Eg if you had 1m notes, it might be OK to have 10% in Holidays, but if you only have 10 notes, I would prefer not to more than 1 (which I may get due to random selection) and preferably none.

Same - I'm not a fan of business loans on the basis of they are borrowing from Harmoney, they are likely to be one of the new businesses that doesn't make it, and if they lose their business, they also lose their job.

Having said those points, while I start out picky, I prefer to be fully invested so may invest (hopefully underweight) in what I think are suboptimal loans (ie. Trusting Harmoney). After all, I have had as many B write offs as F write offs.

the problem is people might make up whatever reasons for loans. i don't know if and how Harmoney verify these reasons.
that's why i think it's probably pointless to scrutinise vague loan descriptions further.
as for business loans, i actually think business loans are safer, in my business anyway. say if i borrow 10k for stocks, i can turn it over in 6 months with 20% profit, that's 40% profit in a year. that loan makes a lot more money sense than someone borrowing for personal needs on wage or salary! there're many reason as to why a profitable business wouldn't want to borrow from a bank, e.g. higher rates. but the problem is again not enough info on the business is disclosed to us, maybe to harmoney, but not to us. so might as well go with harmoney's ratings.

[permutation]

hi, does anyone know how to cancel an in-funding order, if it's possible? thanks.

I believe once you are in-funding you cannot cancel. The only way you might get a refund is when the borrower doesn't accept a fully funded loan.
But hey! in my experience with a rewrite rate of about 20% you'll soon get your money back and will be able to readjust your investment criteria.

[lche059]

I believe once you are in-funding you cannot cancel. The only way you might get a refund is when the borrower doesn't accept a fully funded loan.
But hey! in my experience with a rewrite rate of about 20% you'll soon get your money back and will be able to readjust your investment criteria.

the loan in question is already fully funded but my $25 order is still stuck in in-funding, as shown both on my dashboard and under invest->order history! it's not available for withdrawal nor for investment. it must be a bug or something! not very good for a financial platform.
with regard to rewrite, 3-month wait period is total bs. a determined fraudster could totally exploit this and pay for 3 months and take double amount of loan and run. i would avoid investing in any rewrite unless it's A graded.

[permutation]

the loan in question is already fully funded but my $25 order is still stuck in in-funding, as shown both on my dashboard and under invest->order history! it's not available for withdrawal nor for investment. it must be a bug or something! not very good for a financial platform.

I agree the platform seems to be lacking in a number of areas.

I have had this kind of thing happen as well, Iche059, but don't worry I have found that these things tend to resolve in a few days.

In the past when I have rung the call centre, which I believe is based in Fiji, is particularly not much help either, so I have given that up and just wait for a day or two.

[Saamee]

Attachment 7777

Today I invested in LAI-00052632 ( screen shot attached ) - The query being it was a C3 loan - standard C3 interest is 18.59%.

However this C3 loan had an interest rate attached to it of 20.82% ?? Why??

The only thing is that this loan was a 3 month old Re-Write...... Could the Platform Fee have been rolled up into the repayments and thus higher Interest rate to cover?? I was not aware that Harmoney could \ would do that??

I'm starting to consider looking out more for Re-Write loans..... as someone else recently suggested in this thread >> A Rewritten Loan is not likely to be rewritten again anytime soon, if the capital borrowed has just been Increased!!

Attachment 7778