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Thread: Harmoney

  1. #2671
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    Good to have this type of discussion for us newish investors

    I've just run some stats on default. And looking at the posted stats on this board, I am genuinely surprised the Interest / Charge Off Stat are so Good!

    Running comparatives off Lending Club, shows


    delinq/iss* chg/iss chg/int
    lending club 2017 Q1 & Q2 1.3% 0.1% 3%
    lending club 2016 Q3 & Q4 4.8% 2.1% 23%
    lending club 2016 Q1 & Q2 7.7% 5.5% 44%
    lending club 2015 Q3 & Q4 9.3% 7.6% 50%
    lending club 2015 Q1 & Q2 10.3% 9.3% 52%
    lending club 2014 Q3 & Q4 10.2% 9.7% 48%
    lending club 2014 Q1 & Q2 9.9% 9.6% 43%
    lending club Q3 2015 to Q2 2017 6.0% 4.1% 39%
    harmony All 6.5% 2.8% 21%

    * Delinq = in arrears + charge off*
    ** HM “late” definition slightly wider, LC removes 1-15 day


    Harmoney is roughly tracking Lending Club on delinquency, so Charge/Issue should project to 10%.

    A couple of observations.

    1. Harmoney’s Late / Charge off is HUGE. Is sitting at 132% compared LC 46% (Q3 2015+)
    2. Delaying moving arrears to charge off artificially inflates platform RAR. By approx 2% if 50% delayed
    3. There is a MASSIVE difference between retail and wholesale, 2.5%. If mix on grading is equal, wholesale defaults calculate out as 3 times greater then retail!


    RAR prop % charge i nt issue days chg/iss
    Overall 11.5% 15542 72,795 558,230 325 2.78%
    Retail 13.2% 30% 2100 21,839 167,469 1.25%
    Wholesale 10.8% 70% 13442 50,957 390,761 3.44%
    Last edited by leesal; 08-09-2017 at 09:08 AM.

  2. #2672
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    Quote Originally Posted by BJ1 View Post
    My average loan is $671. I've had two writeoffs, the largest being $382 on a $500 loan taken as one of the first four invested back in Feb2015. I hate taking hits which is why my spread is the way it is. I'm not after top % but an average I can live with. I ignore RAR and look only to current return and my projection - which sadly is now falling with the new rates in place. Given that the opportunities for these returns are very limited, Harmoney will continue to represent a solid percentage of my portfolio - for the next couple of years it should outperform most other options, so accepting that defaults will occur is just part of the business.
    Charge off 3% of Interest after 2 & half years invested is fantastic!

  3. #2673
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    Quote Originally Posted by myles View Post
    Cool Bear, Darchie, Alistar - are you willing to share the % of: number of default loans / number of total loans and the time frame ?

    Clearly this should vary based on loan grade and many other factors, but it would be a useful value to compare against what Harmoney provide.
    heres some info for you

    Attachment 9150

  4. #2674
    yeah, nah
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    Quote Originally Posted by leesal View Post
    Charge off 3% of Interest after 2 & half years invested is fantastic!
    Agree! Only having two in that timeframe is impressive. I've just taken my first two in only 6 months of investing

  5. #2675
    yeah, nah
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    Quote Originally Posted by alistar_mid View Post
    heres some info for you
    Thanks Alistar - you really are starting to take a bit of a pounding, but your returns are still looking good - par for the course I guess.

  6. #2676
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    Quote Originally Posted by myles View Post
    Thanks Alistar - you really are starting to take a bit of a pounding, but your returns are still looking good - par for the course I guess.
    yeah my a$$ is pretty sore right now - the last 2 days had another $500 of write offs come in.

    post tax IRR based on money in and money out is now < 10%
    Last edited by alistar_mid; 08-09-2017 at 11:00 AM.

  7. #2677
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    Quote Originally Posted by BJ1 View Post
    My average loan is $671. I've had two writeoffs, the largest being $382 on a $500 loan taken as one of the first four invested back in Feb2015. I hate taking hits which is why my spread is the way it is. I'm not after top % but an average I can live with. I ignore RAR and look only to current return and my projection - which sadly is now falling with the new rates in place. Given that the opportunities for these returns are very limited, Harmoney will continue to represent a solid percentage of my portfolio - for the next couple of years it should outperform most other options, so accepting that defaults will occur is just part of the business.
    Very respectable figures BJ1 and a very low charge back sum compared to others. Well done!

  8. #2678
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    Quote Originally Posted by alistar_mid View Post
    yeah my a$$ is pretty sore right now - the last 2 days had another $500 of write offs come in.

    post tax IRR based on money in and money out is now < 10%
    You must be doing some very heavy hitting Alistar. In three weeks (18 Apr - 11 May) both your total invested and principle outstanding increased by around $30,000 but the total number of loans only increased by 14. That's around $2000 per loan and presents a real opportunity for big charge-offs.
    Apr-May 17.jpg
    Last edited by joker; 08-09-2017 at 03:48 PM. Reason: Changed principle invested to principle outstanding

  9. #2679
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    I see some people taking large numbers of notes per loan, surely the risk becomes massive especially with E,F grades.

    Have only taken 101 E,F grades since March 2015 and stopped investing late last year. There are now only 26 active loans, have had 15/101 defaults in E and F being a 14.85% default rate.

    Yet have taken 1259 A_D grade loans over the last 30 months and have 8/1259 defaults being 0.635%

    My RAR has climbed to 14.55% being 3.05% above the platform RAR to date. I now only lend in 12 sub-grades.

    I also take into account Payment Protect fees less Lender/ Borrower rebates in my $value charged off v Gross interest ratio. Which reduces this figure from 12.74% to a 6.48% Gross interest loss.

    Ideally over time I would like the net Payment Protect figure to cancel out the Charge off $ value.

    permutation risk spread update.JPG
    Last edited by permutation; 09-09-2017 at 12:35 PM. Reason: refreshed table

  10. #2680
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    Quote Originally Posted by joker View Post
    You must be doing some very heavy hitting Alistar. In three weeks (18 Apr - 11 May) both your total invested and principle outstanding increased by around $30,000 but the total number of loans only increased by 14. That's around $2000 per loan and presents a real opportunity for big charge-offs.
    Apr-May 17.jpg
    Nah average loan value is $93.

    Theres a lag from when you place them to when they show up in reporting (the csv download)

    10-Mar-17 24-Mar-17 18-Apr-17 11-May-17 31-May-17 09-Jun-17 07-Jul-17
    Total Invested $ 69,173 $ 70,122 $ 73,014 $ 104,364 $ 117,166 $ 116,918 $ 116,466
    Principle Outsanding $ 61,815 $ 61,200 $ 62,072 $ 90,073 $ 99,911 $ 98,085 $ 92,094
    Principle Paid up $ 7,359 $ 8,922 $ 10,942 $ 14,292 $ 17,255 $ 18,833 $ 24,372
    Principle Outsanding "Live" $ 51,272 $ 57,745 $ 57,882 $ 58,688 $ 73,239 $ 84,112 $ 91,068


    The principle "live" is reflective of the number of loans showing up

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