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25-06-2017, 12:02 AM
#2311
yeah, nah
Interesting? - Arrears by Credit Grade graph at the bottom of the Marketplace Statistics page, shows individual grade arrears values - the values I find interesting are the 181 days plus for C (0.13%) vs D (0.15%) and E (0.45%) vs F (0.46%) - very similar for these two pair of grades - does that suggest that they have similar default rates and, for example, if you invest in E grades, you might as well invest in F grades?
Perhaps I'm reading too much into these values?
Attachment 8941
It will be interesting to see how these change over time if nothing else, could be a good indicator of things going bad (or getting better)...
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25-06-2017, 07:37 AM
#2312
Member
Well that's $500m Turnover, but with 40% repayments is that about $300m in current loans?
I wouldn't invest in either E or F grade anymore!
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25-06-2017, 10:05 AM
#2313
yeah, nah
Originally Posted by permutation
I wouldn't invest in either E or F grade anymore!
I would never have guessed that
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25-06-2017, 02:49 PM
#2314
Originally Posted by myles
Interesting? - Arrears by Credit Grade graph at the bottom of the Marketplace Statistics page, shows individual grade arrears values - the values I find interesting are the 181 days plus for C (0.13%) vs D (0.15%) and E (0.45%) vs F (0.46%) - very similar for these two pair of grades - does that suggest that they have similar default rates and, for example, if you invest in E grades, you might as well invest in F grades?
Perhaps I'm reading too much into these values?...
Do most arrears "progress" from 121-180 days to default status without reaching 181 days in arrear? If that's the case then the 3.77% of F grades in arrears 121-180 days (Vs. 2.77% of E grades) would indicate the likelihood of a greater % of F grades about to go into default.
Just checking Investor FAQ:
"If we are unable to collect from the Borrower within 120 days, the loan is considered defaulted and moves into a "charged off" status. In some cases, loans may not be charged off at 120 days if there is a reasonable likelihood of payments being made."
It sounds like only a very few arrears would make it past 180 days without being defaulted earlier. The comparative 91-120 days in arrears figures of 2.80% for E grades Vs 4.81% for F grades suggest most defaults have occurred prior to being 181 days in arrear.
https://www.harmoney.co.nz/how-it-works/investor-faq
Last edited by Bjauck; 25-06-2017 at 03:06 PM.
Reason: Referred to the FAQ
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25-06-2017, 05:15 PM
#2315
yeah, nah
Yeah, was thinking the same thing after I posted. The numbers don't look quite right with the 1-30 coming after the 31-60 either?
Still could be a good indicator of what's happening if monitored over time, though not sure how often the graph will be updated. Wait and see I guess.
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25-06-2017, 05:18 PM
#2316
yeah, nah
If you look at the other end i.e. A, B and C at the 120 day point, they are all very close to 0.4%, so perhaps A and B's are of much less value than C's based on the percentage return? (Could just be dodgy numbers???)
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27-06-2017, 01:18 PM
#2317
Member
How is it possible for a borrower in their 30s to have been at a residence for 40 years? It makes me wonder if Harmoney bothers to check the info that borrowers provide at all.
Screenshot_4.jpg
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27-06-2017, 01:28 PM
#2318
Member
Originally Posted by myles
It's 2 loans in 30-60 arrears, but I write them off at 60 days so my numbers are a more realistic present value. (Harmoney list it as $1.88 in arrears if that helps). At this stage this doesn't set off any alarm bells for me. I consider $2,000 to be charged-off each year to be expected for the loan spread that I have. Ask me again in 7-8 months, my opinion might change when arrears really kick in
I'm at the 9-10 month point with $100k invested in now - although this was $50k about 6 months in and then another input of $50k of the last 3 months.
I don't have auto invest going and plan to just let the money come out weekly until i am down to $50k
I think Myles and I have roughly similar loan distributions, my average loan size is around $90 too, although I am 80% 5 year loans and myles is ~80% 3 year loans (I think)
So this is me as of now, i started in Aug last year
hamrony 2706.JPG
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27-06-2017, 03:24 PM
#2319
yeah, nah
Originally Posted by alistar_mid
So this is me as of now, i started in Aug last year
Those A's are holding you back I'm waiting for my RAR to come in to compare to your's - I think I'll beat you because of your A's. Should have some money on it.
Grades.png
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27-06-2017, 04:06 PM
#2320
Member
Originally Posted by myles
I consider $2,000 to be charged-off each year to be expected for the loan spread that I have. Ask me again in 7-8 months, my opinion might change when arrears really kick in
Miles, I used Harmoney default rate for each loan in a spreedsheet which then works out the weighted average default rate. I presume you do too. I am almost 2 years in and over 5000 loans (mostly minimal notes). My weighted average default rate/weighted average gross interest rate as per the spreadsheet is 10.22%. However, in real life it is 19.6% currently. So you probably have to up your expected charged-off to $4000.
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