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  1. #436
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    Quote Originally Posted by beacon View Post
    How is your secondary market fair to loan vendors who have to sacrifice 1% interest as loan sale fee but still have to wait weeks or months to receive their funds back? Kind of waters down the benefit of a secondary market a lot, with investors not knowing when they'll be able to exit their investment (if at all!)

    Banks/finance cos. charge the 1% break/penalty fee too but their redemptions are instantaneous. Your model is different, but Squirrel pitches itself as better than these in the first place to justify its comparatively lower interest rates vs the NZ P2P sector, isn't it?

    I think if no acceptance confirmation emails were needed from the investor for making the initial investment in a loan (making your process automatic), then none should be needed for investing in the secondary market loans either (making this process automatic), since you do not disclose loan details at initial investment anyway and acknowledge that credit events and loan terms don't really disadvantage a secondary market loan buyer. In fact, everyone then gets a chance to benefit from an improved rate (rather than just the lucky guy who happened to check his junk mail folder in time). Now that would be fairer, don't you think?

    Anyway, good to see that you seem genuinely interested in listening to feedback and making some effort to improve your platform.
    Thanks @beacon. Just to clarify, as I stated above, the confirmation email is only required if: 1) the loan has had a missed payment or the like at some point, or 2) the remaining term of the investment is outside of the automatic matching rules documented in the Secondary Market Rules. The first criteria is mandated by the FMA as part of our licence to operate the secondary market - so we have no discretion with that, the second forms part of the rules we thought appropriate when launching the secondary market - so we can and will be amending that one fairly soon to help improve the efficiency of the secondary market.

    The point you make about the 'lucky guy who happened to check his junk mail' isn't quite right - the 'lucky guy' as you put it is actually the best matched investor for that investment per the Secondary Market Rules - effectively the investor at the front of the queue - so yes I do think that is the fairest approach and I do not see that changing. EDITED - perhaps we could look at offering it to a larger group, say the top 10 investors in the queue - that would presumably speed up the transfer process.

    Finally, the investment propositions and platform functionality available in the market clearly varies between P2P providers and the various financial institutions about – and yes, the rates our investors have achieved may be lower than some others – but ultimately it comes down to investor risk appetite and what features of each platform they value.

    We’ll keep working on the resolution for the small number of investments travelling slowly through the secondary market – and I’ll let you all know when its resolved.

    All the best with your investing.
    Last edited by TB@squirrel.co.nz; 11-02-2020 at 01:13 PM. Reason: Additional thoughts

  2. #437
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    Any one recently Invested funds @ 7.5% ( 5 - 7 Year Loans )...... What is the current wait time like > From placing Funds to Order being Fulfilled??

    I see that there is currently over 450K waiting in the 7% Rate queue
    Last edited by Saamee; 14-02-2020 at 02:11 AM.

  3. #438
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    ~$7500 fulfilled roughly 3 weeks ago after about a month on offer. It was taken up in 2 lots.
    Last edited by BWH; 14-02-2020 at 05:35 AM.

  4. #439
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    Big changes coming based on the email I got today.

    Good to see Squirrel doubling down on 100% retail P2P considering the news re Harmoney.
    Last edited by unhuman; 19-02-2020 at 07:15 PM.

  5. #440
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    Hi @beacon - just thought I'd provide an update on the delays in the secondary market.

    We have investigated the causes of slow investment transfers and identified a bunch of improvements and some system fixes that we can implement to improve the efficiency of the secondary market. A number of these have already been moved into production and we have now cleared all investments offered for sale before today other than one small investment that has a credit event associated with it that has been out for transfer for a few weeks.

    In addition to the tweaks to software and the process, we have implemented more regular monitoring of any investments that might get ‘stuck’ in the process. The reasons for things getting stuck look to be quite complicated as they seem to require a number of seemingly unrelated factors that come together and collectively that contribute to bottlenecks – but the most likely reason we've seen looks to be an investor either not seeing the offer emails or not quite understanding what they are being offered. We have recently started contacting those investors via phone to explain the situation and walk them through it to some form of conclusion.

    Using email notifications has also clearly created issues with investors not seeing them if they go into a spam folder etc. To remedy that situation, we are looking at options around push notifications via our mobile apps which we think will greatly improve the efficiency of that notification process. That isn’t able to be implemented immediately though unfortunately.

    Finally, it became clear that our automatic matching rules resulted in too many unnecessary exceptions so we have scoped some widening of the acceptable tolerances (usually remaining term related) to more pragmatic levels and are planning to roll out those amendments in the next few weeks which will further improve the efficiency of the secondary market.

    It is fair to say that this has proven to be a bigger can of worms than I anticipated when we first started communicating – but it has been a valuable process and has greatly improved this aspect of our platform - so thanks for all your feedback!

    Tim
    Last edited by TB@squirrel.co.nz; 04-03-2020 at 04:43 PM.

  6. #441
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    I see that the Squirrel Reserve Fund has dropped since I last looked about a month ago. If it continues to drop, can Squirrel increase the proportion of interest that is credited to the reserve fund, or do thy have to wait until such time that 100% of the interest is needed to be diverted to the reserve fund to cover defaults?

    With Corona Virus already causing economic issues, there could be borrowers under stress.
    Last edited by Bjauck; 08-03-2020 at 09:11 AM.

  7. #442
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    Quote Originally Posted by Bjauck View Post
    I see that the Squirrel Reserve Fund has dropped since I last looked about a month ago. If it continues to drop, can Squirrel increase the proportion of interest that is credited to the reserve fund, or do thy have to wait until such time that 100% of the interest is needed to be diverted to the reserve fund to cover defaults?

    With Corona Virus already causing economic issues, there could be borrowers under stress.

    Squirrel alter the % rate payable, often.

    However I doubt that they will change it enough to keep up, if Bad Loans come in faster than in the past.

    It must be expected that Bad Loans will come in fast from now on, as Forestry, Hospitality, Travel and Hotel Industries all start to take a Hit!!


    I personally took a decision 2 weeks ago not to invest any more in to P2P Loans at this time.

  8. #443
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    Quote Originally Posted by Saamee View Post
    Squirrel alter the % rate payable, often...
    I personally took a decision 2 weeks ago not to invest any more in to P2P Loans at this time.
    Thanks. There is a lot of uncertainty around at the moment. With interest rates falling and bad debts increasing, there is the prospect for a big squeeze.

    Aussie Bank shares & HGH have been hard hit too. The market is probably expecting a tough time for borrowers.
    Last edited by Bjauck; 08-03-2020 at 09:55 AM.

  9. #444
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    I suspect the Squirrel Reserve Fund is going to come under a real stress test this year if the predicated recession occurs.

  10. #445
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    @morphs - Yes, for sure it will.


    Below is the reserve fund figures as of this morning.


    So just $485,958 of Bad loans......... and the Reserve Fund is at ZERO!!



    SM RES FUND.jpg


    SM RES FUND 1.PNG
    Last edited by Saamee; 12-03-2020 at 01:08 PM.

  11. #446
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    2020 RWT Certificares already available for member download.....

  12. #447
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    Some defensive PR from Squirrel in the mailbox this arvo ... must be feeling the pinch!

    Case study 1
    Investing class: Home Loans


    A mortgage for an experienced property investor


    The first loan on our platform is for $1.4m and is secured over two properties in Point Chevalier, Auckland with $1.1m in security over each. It has a 70% loan to value ratio.


    Our credit policy:


    Maximum loan to value ratio of 80%
    Maximum loan of $1m per property and a total limit of $2m
    With our first Home Loan on the platform, the borrower owns $31m in property and has $12m in lending.


    The funds borrowed from Squirrel are for working capital and the client is holding $3m in cash. The customer’s property portfolio is diversified and generates over $1m p.a. of income. He has also provided a personal guarantee on the loan. This means that there is someone standing behind the loan who can guarantee the payments at a personal level, similar to when a parent acts as a guarantor on a home loan for their children.


    The reason the client borrowed from Squirrel is that banks treat them as a commercial client and will only lend against the income of the property they have security over and with too many covenants. He was prepared to pay a bit more for a simpler borrowing solution.


    We felt this mortgage was low risk because:


    The client has strong underlying income from a diversified property portfolio
    They are carrying a low level of gearing (low LVR)
    The security is a first residential mortgage with a loan to value ratio on the properties of 70% and a personal guarantee from the borrower
    The borrower holds significant working capital and undrawn revolving credits (meaning he has cash available to him)


    You can invest into this mortgage now. The investor return is 4.0% p.a. variable, and you can find out lots more about this investment class from our investor handbook here.


    This loan is also protected by our Home Loan Reserve Fund, which protects investors from loan arrears and loan defaults.
    "The market can stay irrational longer than you can stay solvent." – John Maynard Keynes

  13. #448
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    Currently the situation must be very toght for Suirrel Money, I have never before heard them advertising on the radio in NZ.

    However over the last month they are pushing loans and webinars to learn more.

    They have that massive $1.3M house loan at 4%..... and it looks like the majority of would be investros are NOT interested in taking a slice of it!!

  14. #449
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    Quote Originally Posted by Saamee View Post
    Currently the situation must be very toght for Suirrel Money, I have never before heard them advertising on the radio in NZ.

    However over the last month they are pushing loans and webinars to learn more.

    They have that massive $1.3M house loan at 4%..... and it looks like the majority of would be investros are NOT interested in taking a slice of it!!
    At only 4% the risk-reward balance looks tipped more towards risk at the moment. The interest rate would need to be higher to tempt more investors?

  15. #450
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    Today received an Email from Squirrel Offering TO PAY us Investors $500 to $1,000 to get into Property \ Business Loans....

    Wow they are getting very very Deperate now...

    Even more reason to stay away!!!!

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