Length doesn't matter to me I would prefer spend my time cherry picking thru the loans borrower info.
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hammered by bad loans today - 5 loans written off today so far. Will be interesting to see what that does to my RAR which will be published soon, I presume. Hopefully the new calculation takes these write offs into account.
I had, perhaps wrongly, the opposite view. I assumed that if the average time to failure was 1 year then you would be best to have short duration loans as you would have received 1/3rd of the repayments before it went bad, vs only 1/6th Is my reasoning incorrect? With that in mind I have only invested in 36 month loans.
As everyone is publishing their performance I thought I would share mine. I have only invested in A or B grade loans, always 36 months. Never for anyone over 50, never for business loans or cars or loans to family. Never invested in a rewrite - my philosophy being that if they are the type of person who keeps digging themselves into debt then they aren't truly trying to improve their debt position. To date I haven't had a single write off (touch wood). But I have WAAAY less invested than many others here.
Does anyone else get this following little quirk sometimes when Withdrawing funds from your HM account?
After completing a Withdrawl and taking out ALL availble shown funds.... ( leaving zero funds behind )
Afterwards, you are then shown even more funds still in your account available to still be withdrawn?
This can go on for 2 to 4 Withdrawls before you do finally get to getting to a Zero funds balance ....
I've not said anythng here, before but it still happen 3 or 4 times a week!
The way I see it: Assuming loss is after 1 year and assuming you re-invested in another 3 year loan your chances of getting a write-off increase (you pass the 1 year mark more often over time). Crudely, 67% x (5/3) > 80%. But I think you can be too picky given the scarcity of loans as the risk of lack of diversification is the biggest issue. If you have not had any charge-offs it may be because you lack sufficient diversification....
As a rule of thumb it is best to have at least 100 loans of each of the higher bands in which you invest( 100 A's and 100 B's). The lower the grade the higher the number needed to get full benefits of diversification. This is a bit counter-intuitive because the temptation is to dabble with a few higher risk loans whereas you should actually have more to reduce risk of negative returns. I also do C and D but have several hundred of each based on statistical research by others. I don't think the returns on E & F are worth the risk at this point but with a couple of years of data might re-think. Good luck!
Ever since the new fee structure kicked in 13th June I've had a Very VERY STRICT rigid criteria that I adhere too.....
Since 13th I've taken 261 loans and in amongst those there's 2 different "F grade" loans that are NOT within my criteria. .... i find this somewhat unsettling! !
Initially I'd kept a personal listing of each loan i went into ... but over time drifted away from that...
I know some would put this down to human error on my part!!! BUT But but!!
Has anyone else kept tight records and found similar quirks ... or even like me quite puzzled as to why these two loans are in my stable!
I see the latest retail RAR is now 13.44% - up from July despite the increase in retail fees for new loans.
That is to be expected for those who have been in for a while because Harmoney cut the platform fee (to borrowers) and replaced it with higher interest rates but we lenders didn't get fee hikes to cover the hole in Harmoney's P&L for another six months. Effectively we got bonus rates for those months and those are now filtering through BUT this will slowly reverse over time as those loans move along the profile and are blended with new loans.