sharetrader
Page 215 of 465 FirstFirst ... 115165205211212213214215216217218219225265315 ... LastLast
Results 2,141 to 2,150 of 4649

Thread: Harmoney

  1. #2141
    Member
    Join Date
    May 2014
    Posts
    204

    Default

    Quote Originally Posted by IntheRearWithTheGear View Post
    I was just using your numbers and assumptions from your previous post.

    Harmony has a graph which you can use to predict defaults - most defaults acording to them happen near the 3 month point and then tail downward

    its at the bottom of this page

    https://www.harmoney.co.nz/investors/investment-risks

    called the hazard curve down the bottom.

    Which maps to the below array values - which you can use in your spreadsheet.

    2.00, 2.30, 4.00, 5.00, 5.80, 5.70, 5.60, 6.00, 5.70, 5.20, 5.80, 5.00, 4.70, 4.00, 3.60, 3.15, 3.00, 2.70, 2.10, 2.15, 2.00, 1.90, 1.60, 1.40, 1.60, 1.00, 1.20, 1.00, 0.90, 0.80, 0.60, 0.55, 0.50, 0.50, 0.60, 0.15, 0.05, 0.05, 0.05, 0.05, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00, 0.00



    Cheers
    I'll do a version 2

    The US article that has been linked around here on how p2p lending goes during a recession is reassuring that we should be ok too, reasonably ok.

    Ultimately over time, the ultimate measurement is actualls.. a simple XIRR on a timeline of all your deposits vs all your withdrawals..

    I'm pretty sure that XIRR is after tax too, as what I have sitting in my account and have had (withdrawals) already has the tax on it.

    (i know, I know, I can't get the whole 80k out right now)

    Attachment 8825

  2. #2142
    Member
    Join Date
    Apr 2016
    Posts
    83

    Default

    Yes, i agree the “outstanding principal” has tax paid. And the other good news is you could perhaps add back the harmony fees – as they should be tax deductable.

    Good luck claiming any defaults though – other people have ideas on that.

    One word of caution is you yet to have defaults as they are roughly 180+ days outstanding and you have only been in the game
    for 260 days – so they will take a chink on your 14% - once they start to come through – however you can predict that
    with your arrears balance somewhat.

    Cheers

  3. #2143
    Member
    Join Date
    May 2014
    Posts
    204

    Default

    Quote Originally Posted by IntheRearWithTheGear View Post
    Yes, i agree the “outstanding principal” has tax paid. And the other good news is you could perhaps add back the harmony fees – as they should be tax deductable.

    Good luck claiming any defaults though – other people have ideas on that.

    One word of caution is you yet to have defaults as they are roughly 180+ days outstanding and you have only been in the game
    for 260 days – so they will take a chink on your 14% - once they start to come through – however you can predict that
    with your arrears balance somewhat.

    Cheers

    yeah I know I can claim the fees back as an expense, and that my portfolio is not mature so obviously a zero default rate (what it is thusfar) is totally unrealistic.

    Seems like I have lucked out a bit, some of the best value loans i found (35% interest, <5% default rate E's) I invested 8 notes in... well 3 of those are in arrears. Really bad strike rate!

  4. #2144
    Member
    Join Date
    Nov 2016
    Posts
    159

    Default

    Quote Originally Posted by permutation View Post
    I think mortgage holders will do all they can not to default. I feel that the repayment to income ratio is important and I generally base my lending on ratios between 5-17% and a max of $25,000.
    Just a clarification please - is this % the Harmoney payments to income? Because we don't see any other commitments in the borrower details and if they have a mortgage the odds are that will account for perhaps 40% of pretax income? Makin a hellish debt commitment if Harmoney takes 17% of aftertax?

  5. #2145
    yeah, nah
    Join Date
    Mar 2017
    Posts
    491

    Default

    Quote Originally Posted by BJ1 View Post
    Makin a hellish debt commitment if Harmoney takes 17% of aftertax?
    Correct, and they will no doubt put paying their mortgage well in front of their Harmoney loan, hence my previous suggestion that 'Renting', is worth diversifying into.

  6. #2146
    Member
    Join Date
    Dec 2015
    Posts
    153

    Default

    Quote Originally Posted by BJ1 View Post
    Just a clarification please - is this % the Harmoney payments to income? Because we don't see any other commitments in the borrower details and if they have a mortgage the odds are that will account for perhaps 40% of pretax income? Makin a hellish debt commitment if Harmoney takes 17% of after tax?
    That is correct, I have written about this in much earlier posts, some financial commentators state that individuals paying more than 35% of their after tax income on a mortgage loan could be deemed to be in financial stress. So an additional secondary loan could push some people to 40-50% of their income.

    One wonders why these individuals don't apply to their bank for an extra loan top-up instead of the secondary market?

    I have trawled through my own statistics of 1100 loans taken in the last 2 years. Here are some facts:


    • 642/1100 loans were with a mortgage and only 2 of these have defaulted
    • 348/1100 loans were to renters and a total of 5 defaults
    • 33/1100 loans were owned no mortgage, supplied by employer and 0 defaults
    • 77/1100 loans were living with parents, boarding and other, with a total of 9 defaults

  7. #2147
    yeah, nah
    Join Date
    Mar 2017
    Posts
    491

    Default

    Those numbers aren't really meaningful without taking into account the grades that they come from though. e.g. potentially more Renters in higher risk grades?

    I suspect you'd only see the real trend if/when the economy/housing marking shifts significantly downward and there would be a lag (maybe 6-12 months after)? (If you study the Lending Club data you can clearly see a lag.)

  8. #2148
    Member
    Join Date
    Jan 2017
    Posts
    152

    Default

    I see quite a few borrowers listing Boarding as their Residential Status. What's the difference between Boarding and Renting? Would borrowers who board be a higher risk of defaulting than borrowers who rent?

  9. #2149
    Member
    Join Date
    Nov 2016
    Posts
    159

    Default

    Quote Originally Posted by permutation;

    [LIST
    [*]642/1100 loans were with a mortgage and only 2 of these have defaulted[*]348/1100 loans were to renters and a total of 5 defaults[*]33/1100 loans were owned no mortgage, supplied by employer and 0 defaults[*]77/1100 loans were living with parents, boarding and other, with a total of 9 defaults[/LIST]
    Stats like these should be a guide to all those lenders who dislike seeing defaults in their book. It is possible to minimise default risk by cherry picking loans but that may come at a cost in terms of net return. The alternative is to just try for the Harmoney average per grade invested in (D & E are highest net) and don't bother thinking about defaults - perform like the Harmoney portfolio in C, D & E and you are doing well. We should all be thankful, as am I, that our money isn't in the banks.

  10. #2150
    Member
    Join Date
    Dec 2015
    Posts
    153

    Default

    Quote Originally Posted by icyfire View Post
    I see quite a few borrowers listing Boarding as their Residential Status. What's the difference between Boarding and Renting? Would borrowers who board be a higher risk of defaulting than borrowers who rent?
    Generally Boarders are people that rent a room from either a Home owner or a Boarding House for a fixed amount per week which could include a bed and other furniture and sometimes a meal may be provided.

    Renting is mostly an unfurnished house that one or more people pay a Landlord and the renters themselves provide all the necessities of everyday living.

    Many young people over 18 may board with their parents or other relatives for a time, because renting could be a prohibitive cost to them starting out into adult life.

    It's hard to judge the risk between renters and boarders in the lower E and F grades, but only 2 from 16 of my loan defaults to date were mortgage holders in the B grade.
    Last edited by permutation; 06-05-2017 at 06:28 PM. Reason: addendum

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •