Harmoney

[BJ1]

Still no reports coming through. Have noticed these two loans recently. I'm not sure how these levels of repayment are manageable and I'm sure I wouldn't want an autolend setting to have placed them in my portfolio.

[icyfire]

Still no reports coming through. Have noticed these two loans recently. I'm not sure how these levels of repayment are manageable and I'm sure I wouldn't want an autolend setting to have placed them in my portfolio.

The debt-to-income ratio on the first loan is 24.3% which is pretty high IMO.
The second loan is even worse at 25% which makes one wonder how on earth it's an A4
Hopefully Harmoney's new system will do a better job.

[777]

The debt-to-income ratio on the first loan is 24.3% which is pretty high IMO.
The second loan is even worse at 25% which makes one wonder how on earth it's an A4
Hopefully Harmoney's new system will do a better job.

A4 because he owns his house without a mortgage.

Low income as over 60 and probably not working but getting the pension plus investment income or part time work.

Actually I see he has been with his employer for 21 years so is still working.

[icyfire]

A4 because he owns his house without a mortgage.

That would have been helpful if he/she used the house as security. I doubt the borrower would sell the house to pay off the loan if lost their job or retired.
Paying off a 77K loan at a very high repayment rate over the next 5 years makes this loan a high risk and low reward.

[IntheRearWithTheGear]

But if you doubt the loan rating - would that not mean you doubt all loan ratings ?

Harmoney have access to more data than we do (one would hope) - they have a better picture to classify
the loan - i would say we cant beat that with less information.

Perhaps sombody who owns their own house would count higher plus the fact that may have
had other loans in the past etc - which show good behavours. Maybe being married ups the score.

If harmony get it wrong - im out $25.00

We dont see past loan history but can guess at it - i guess thats the magic sauce which makes it all work.

[777]

That would have been helpful if he/she used the house as security. I doubt the borrower would sell the house to pay off the loan if lost their job or retired.
Paying off a 77K loan at a very high repayment rate over the next 5 years makes this loan a high risk and low reward.

Owning his house without a mortgage would indicate he has a repayment history which is what would give him points.

[icyfire]

But if you doubt the loan rating - would that not mean you doubt all loan ratings ?

I certainly don't have blind faith in Harmoney's loan ratings. However, I don't doubt all loan ratings, just the ones that look questionable.

[Darchie]

How about he was an only child & was gifted the house!

[BJ1]

I posted the first two and this one because the first two tenets of lending are the willingness and ability to repay, not security (which we don't have) or asset values. After this one, no more. BUT, I won't be surprised if Harmoney cops more flack if these become quite normal.

[icyfire]

I posted the first two and this one because the first two tenets of lending are the willingness and ability to repay, not security (which we don't have) or asset values. After this one, no more. BUT, I won't be surprised if Harmoney cops more flack if these become quite normal.

It just doesn't make any logical sense to me. Why would they borrow 49K at 18.5% when they could have gone to the bank and got a mortgage at 5%?
And the income-to-debt ratio on this loan is 34% which is crazy high.