Harmoney

[SilverBack]

Correct. The analysis was not very calculated.

Not so. I have calculated the actual return that I get on every repaid loan using the number of days that the loan was outstanding after deducting the service fees. The only time that there is any significant difference is when the borrower pays off more heavily during the earlier part of the loan rather than a regular monthly payment. The length of time that a loan is outstanding does not make any difference when regular payments are made.

[myles]

No, my figures show that the 5%, more or less, applies across all grades.

You'd have to expand on how that can be. If you have an A grade loan paying 6.99% interest and you pay (I assume by the number of loans you have) a 15% fee on that interest, then your reduction is only 1.05%, where does the other 3.95% disappear too, to make up your suggested 5% drop (1.99% return)?

[RMJH]

I am interested to know who here has stopped investing in A grade after the rate reductions.

I think Auto-lend only allows whole letter grades so you are in or out of As. So far I have stayed in but considering reducing to just B,C and D. 6.99% gross seems too low.

[bung5]

I am interested to know who here has stopped investing in A grade after the rate reductions.

I think Auto-lend only allows whole letter grades so you are in or out of As. So far I have stayed in but considering reducing to just B,C and D. 6.99% gross seems too low.

You can partially invest in the A grade loans by using the interest rate slider. I'm no longer investing in A

[whitt]

You can partially invest in the A grade loans by using the interest rate slider. I'm no longer investing in A

Bung5 is correct. Grade option seems redundant if you use interest slider. just deselect grade as an option and go with interest rates

[BJ1]

There was a comment recently about an apparent increase in the number of loans available, since the rate reductions. I've been looking closely and it seems to me there haven't been many more loans funded, but those that are listed hang around a lot longer, especially the low rate A loans. No longer do I see loans come on the list around 20% funded, last for 5-10 minutes and then disappear as though the wholesale funders then snap up what's left. Perhaps HBL and TSB don't like the unsecured return for A1 to A3 either?

[RMJH]

You can partially invest in the A grade loans by using the interest rate slider. I'm no longer investing in A

Thanks for that. I'm now also out of A's.

[RMJH]

https://blog.zopa.com/2017/08/22/cha...redit-outlook/

[Investor]

Harmoney are currently running at a loss...

Ignoring the changes over the last three years - if each of the 30,000 loans contributed $500 to Harmoney, that's $15,000,000, which is only $5,000,000 per year (ignoring startup costs). I can only guess that they would have in excess of 30 employees, plus the cost of building/work space/equipment, plus the cost of the platform development, maintenance etc (which would not be cheap), plus marketing (those TV ads etc. do not come cheap) etc, etc, etc...

If they didn't charge $500 per loan, they would have to charge more in fees (and yes I realise fees weren't included in the above) - guess who pays the fees???

It's clear that some here have absolutely no clue what costs are likely involved in the operation of Harmoney - me included, but with my background I have a bit more of a clue than most

I was referring to relevant, traceable costs (to the application process) which is what the Commerce Commission will care about when they sit down with Harmoney for a chat.

[joker]

Harmoney posted a loss of $6.5 million in the 12 months ended March 2017 down from $14.2 million for the pcp. Revenue climbed to $14 million from $8.6 million a year earlier, while its biggest expenditure item - marketing - dropped 14 percent to $7 million and staff costs were flat at $6.3 million. Subject to what happens with the ComCom, Harmoney should show a profit in the current year but definitely in 2019.
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