Site is down.... I wonder if we will see some new features or improvements.
We’ll be back soon!
Sorry for the inconvenience but we’re performing some maintenance at the moment, we’ll be back online shortly!
— Team Harmoney
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Site is down.... I wonder if we will see some new features or improvements.
We’ll be back soon!
Sorry for the inconvenience but we’re performing some maintenance at the moment, we’ll be back online shortly!
— Team Harmoney
your 3 out of 500 is a touch better than my 10 out of 1600. My worry is that all 10 are from my first 2 months so far. That means that in time the latter months will also go bad and the writeoff rate is far from being the true rate yet!! I think we need to be in at least 18 to 30 months to get the true picture.
Hi Humvee. Thanks for the welcome. Indeed, we had to ask permission again and we are now in. Both of the improvements you suggested are on the roadmap and will be executed very soon. I will keep you in the loop as we get closer. We are at the moment testing new statements which have significantly more information and the additional information re: charge offs is on its way also. Check out the market statistics page - it was updated yesterday to see the platform performance. Monica monica.mathis@harmoney.co.nz
Sounds good
Could the More detailed Employment Type Information that is shown on the page below and also I see now used for some of your market place statistics slides please be added into the loan selection screen information
http://www.mortgagerates.co.nz/p2p-loans.html
Something else interesting for the market place stats would also be what we have just been discussing..... 36month vs 60month defaults and early repayments
Hi Humvee. Absolutely - let me put these through our IT team to size and put on the enhancements list. Great to see we have paid out $15m in interest to our investors so far (see market statistics page). Outage the other night was for 3 hours - hope it didn't inconvenience you guys too much. Monica.mathis@harmoney.co.nz
Hi Monica,
I would be interested in the percentage of loans that default/go into arrears that have never made a single payment. To me it is a good indicator how well you are doing with your initial vetting (Just reading the board here seems to indicate there are a few).
Hi Knot
By No of loans, its circa 10bps or 0.10% or by $ value of loans, less than 5bps or 0.05%. We would always expect there will be an element of this and it is well within our forecast expectations. Please look also at overall portfolio performance as the static loss graphs in the market statistics pages show you, we are well within expectations across the grades. monica.mathis@harmoney.co.nz
Hi Monica
Can you give us a date when you will change your service fee structure that you are currently reviewing? I have previously been told this is happening, and had expected it to be complete by now, based on what I was told.
Hi Kiwi-on_OE
No date and no decisions. Will let you know as soon as we are able of any changes in relation to fees and charges. In the meantime, our fees and charges are as per listed on our site. Monica.mathis@harmoney.co.nz
Hi Monica
I'd be interested to know:
Is there a way of sorting 'within reports' to list up all loans that are in the process of being paid ....... as in paid by borrower but still in harmoneys process system & yet to be paid out to the investor ...
It would be Really Helpful if these showed as a colour... just like the yellow is for arrears & grey is for paid of. ...... is this possible?
Darchie, Not a perfect solution but you can already tell, the number of payments will reduce about 24-48 hours before you actually receive the funds into your investor account.
Hi Monica
Can we have another column in the list of charge off showing when the charge off was made? When one have 1000's of loans, I will expect the list to grow very long and it will be much easier to know which ones were the latest to be written off. Quite difficult to update my own records at the moment. Thanks
Just wondering if anyone else has same impression as me:
Over last week Harmoney just seem to be lagging behind schedule & today it's like nothing much is happening at all!!! ... yet for me it should have ...
This highlights why not having a proper type statement to check all funds in and out is like trying to fly in the dark! It's great that LendingCrowd do have a statement to view.
This above adds to why I asked about having at least that colour highlight on payments that are in harmoneys processing systems... my other reason was a quick way to access projected time management .. (would save on the continual need to check in so often! )
Couldn't agree more, the inability to see important information easily is a real problem, I'd like to see the ability to get a full transaction history, configurable email/sms notifications on events (eg loan full funded and accepted, more than X in your investor account, loan repaid in full, etc).
Currently I grab a csv export of my loans every day automatically and then import it into a database, I am still creating the front end but the idea being to have my own dashboard with all the information I want. I really should scrape the front page as well for other useful bits (as opposed to trying to derive them from the data I do have)
I'd also really love it if I could set a preference that turned on "rewrite auto transfer" - if one of my loans was being rewritten my current investment in that loan is rolled into the new loan (with no 1.25% charge), obviously this would need to be worked out so that it was rolled up or down to the nearest $25 depending on funds being available in my account). I see this as a win for everyone, I don't get hit with the 1.25%, or have idle funds, the borrower gets funded faster, and Harmoney doesn't have grumpy investors, although they lose that lovely 1.25% tax on a rewrite.
Hi Monica and welcome to the Forum. I've been having excellent communication with Mark Bardi before and since joining Harmoney, including asking the question, why are you not here. Better late than never ;-). We look forward to your input and contribution.
Hi Monica,
Welcome.
I would really like to hear the state of your discussions with IRD regarding investors being able to deduct your service fee and charge offs against income for tax purposes.
The out come of this has big implications for the returns of investors.
Regards
HI there, check out our Investor FAQs on the site. We expect that fees paid by investors to Harmoney will be tax deductible. As each investors circumstances are different, we recommend that you(they) seek independent tax advice tat suits their objectives, financial situation and needs. Monica.mathis@harmoney.co.nz
Hi Cool Bear - we will put this onto our enhancements list. Cheers for the feedback. Monica.maths@harmoney.co.nz
In relation to the (not in business) individual taxpayer, of whom there must be many investing with Harmoney, I have had email discussions with Harmoney on the deductibility of charge-offs. The response from Harmoney: For charged off principal, due to that fact that we’re such a new asset class, it’s still up for debate. The IRD has not given us a definitive answer to this question. Harmoney is pursuing this matter with the IRD so we can give our investors a definite answer. Unfortunately there is no exact time frame on when it will arrive.
So the question remains: Is Harmoney still pursuing the IRD for an answer tothis question?
Or do all individual taxpayer investors need to seek professional advice (as it is a new asset class the professionals may need to undertake their own research). Whereas Harmoney could seek a ruling which could apply to a large class of its investors?
For an individual taxpayer, the extra cost of employing a professional to determine whether charge-offs (and indeed service charges) are deductible for an individual in itself will undermine their return from Harmoney in the first year - depending on the size of their investment.
Hi all
On the subject of transactions and statements. We are in the middle of enhancing our statements and they will be out soon. You will receive an email letting you know when they are complete. They will enhance the reporting of transactions - we hope you enjoy. Monica.mathis@harmoney.co.nz
Sorry "Ruling" is the wrong word...At risk of repetition, guidance for various classes (such as company taxpayers, individuals and individuals in the business) of investors is often sought by companies for the effect of proposals and actions. Harmoney have said they are pursuing this matter with the IRD so we can give our investors a definite answer.
SO it remains a reasonable question to ask if Harmoney are still pursuing the matter with the IRD so they can then pass on the response to their investors
Guidance on the application of the tax law, for various types of taxpayers, in relation to the deductions would be good. What type of taxpayer a particular investor is, is a separate issue.
I guess no response indicates that they are no longer seeking guidance from the IRD.
And nor are they obliged to. do you think everyone in the Hannover debacle claimed their non return of deposits as a loss. Come on get real.
1. Harmoney's Peer-to-peer is a new type of financial arrangement (with indication given by Harmoney as to default rate).
2. No they are not obliged to give guidance
2a. Despite this they had indicated they were seeking guidance.
3. Which is why I am asking their representative on this thread if Harmoney is in fact still seeking guidance.
Bjauck & finite.
I do think the question " If Harmoney are still pursuing the matter with the IRD so they can then pass on the response to their investors?" Is a reasonable question to ask and I too would like an answer to it. But you do need to allow a reasonable time for a response. I would rather get the right / most accurate response even if this takes a few days longer.
Table with current experience with Repaid Loans ....
Attachment 7915
Has any one else have any loans invested this weekend that, when looking at the loans funded list they show 100% funded but on the dashboard they still show as a $ amount
" In funding" ( as at 2200 on 28/02/16) and have not appeared in the "loans invested list". This has happened to me several times before in the last 10 months, the loans just appear to be in limbo sometimes for two days.
Have tried to make enquiries about this type of situation with Harmoney before, but in my opinion it's like communicating with a wall.
I have seen it, the one time I got an answer it was because the applicant didn't take the loan up, complicated by the fact it was a rewrite so money went all over the place and got stuck for about a week. That particular time it got stuck at 98% but was showing as funded, other times it was 100%, funded, and not taken up for a few days, but eventually it was.
Permutation - I have not heard that you had a query regarding this matter. If you could email the exact loans you are referring to - I can certainly look into it for you.
Funded loans - in relation to the timing between the dashboard and your loans invested list - there is sometimes a delay between these. We have to go through the entire transaction, fractionalise the amounts before we update your dashboard - so your reports will always be faster. This is because we have batch jobs that need to run first before we are able to update your dashboards. The system is not 'live' - i.e. to the second, but it certainly does update on a regular basis to ensure that all transactions have been taken into account - that means those coming from the banks (all banks), in's and out's.
Hi all, we are looking at a way in which we can get further information regarding tax. But it does depend on whether you are a 'professional' or '
incidental' lender. That is why each persons tax liabilities are their own and very personal to your own circumstances. Monica.mathis@harmoney.co.nz
I would have though that Harmoney could get guidance for both classes of investors - professional and incidental. Obviously it would then be up to the investors themelves, with accountant help, to determine to which class, professional or incidental, they belong.
Anyway thanks for you answer as it is helpful in that it indicates that guidance on the question of law from Harmoney is not imminent and not likely for the current tax year. So, as far as I am concerned, my question of Harmoney has been resolved.
Bjauck - I have already said the law is clear. 'professional = deductible, 'incidental' = non-deductible. The difficult bit is trying to determine which category you are in and that is fact driven, which IRD can give a ruling on and as you state in your post, you need to talk to your accountant about.
If you are a wage or salary earner, and you invest in Harmoney in your own name, my view* is you are incidental. If you invest via an entity that all it does in invest in a diversified portfolio of investments, then you are probably 'professional' but IRD may try to argue a higher standard (ie.not 'professional' or 'in the business of' unless that investment is substantial).
* from someone anonymous on the inernet
Unlike the investor in the Hanover collapse example previously mentioned, a $10,000 investment by an incidental individual (non-entity) investor in Harmoney can actually involve decisions to invest in perhaps 400 different loans in various $25 multiples with subsequent investments in loans throughout the year. Each loan is given a percentage probability of being charged off. The charge-offs together with the service charges are a contemplated expense of the investment with Harmoney. That is why I think guidance from the IRD on this new type of financial arrangement with (capital)charge-offs likely to occur on a regular basis would be welcome.
As I understand it, the total return (capital and income) from Financial arrangements even for an "incidental" or "portfolio" investor is taxable. Unless the loss in capital is due to a loss in credit-worthiness. As a certain percentage loss had been contemplated each time an investor invested in notes of certain grades (with an expected capital loss incorporated in the expected return figures supplied by Harmoney) then would an actual (contemplated) charge off actually be due to loss in credit worthiness? Also Harmoney itself has not suffered any loss in credit-worthiness and they are the ones who make the actual interest payments and deductions to the investors accounts. Your "return" from your Harmoney financial arrangement is actually your gross interest less all deductions and their credit rating is not affected by the bankruptcy of any one individual they lend your "notes" to.
Anyway I agree, until guidance is forthcoming, it would be best for an "incidental" "non-entity" investor to treat charge-offs as definitely non-deductible.
Disclaimer: These are my non-professional anonymous opinions! Definitely Do You Own Research.
Interesting/good points Bjauck but I dont think that is the way the legislation is drafted.The point about effort (400+ loans vs just 1 bought after recommendation from a broker) is a good one as I dont think there are many places that say an activity requires a certain $ amount before it becomes a business. A business is just using effort (labour or capital) to produce a positive return.
interesting point that the interest is paid by Harmoney. I think they may only be treated as an agent so the interest actually comes from the borrower.
The agency aspect is interesting. I don't know much about the law of agency. However with other loans arranged by an agent I think that the principal (as opposed to the agent) actually becomes the lender and enters a contract with the borrower whereas I don't think that happens when Harmoney allots a note to an investor. The investor does not enter a contract with the borrower.
Indeed Harmoney also determines how much information is passed on to the investor in relation to the loan and the borrower. Would an investor even intend to have a contractual relationship with the borrower that was independent of Harmoney?
I think Harmoney determines when and how borrower defaults are passed on to investors and this is part of the financial arrangement contract between Harmoney and the investor.
A Trustee is the middleman in all Harmoney loans.
So simply put, the way I see it, is...Harmoney enters into a financial arrangement with the Investor who then deposits their money into an account held by the trustee. Harmoney then enters into financial arrangements with the borrowers who then deposit their payments into an account held by the trustee. So the investor's financial arrangement is with Harmoney who, in the normal and solvent course of their operations and according to the contract with the investor, deduct charge-offs to the investor's account. My untrustworthy opinion only.
Borrower Agreement:
18. Immediately after Harmoney has provided the Loan Disclosure to you, a Loan Contract will come into existence under which the Trustee (who will be the lender of the Loan) will agree to advance the Loan Amount to you.
Investors Agreement:
11. Every Loan you fund through the Service will be made by the Trustee (acting through Harmoney as its agent). The Trustee will then hold that Loan on a bare trust for the benefit of yourself and every other Participating Investor in accordance with clause 15.
The investor agreement goes into some detail about the Trustee role; https://www.harmoney.co.nz/how-it-wo...stor-agreement
btw the Trustee has Harmoney as it's agent, so in some ways it is all smoke and mirrors (ie the trustee doesn't actually do anything)
So the Trustee has the financial arrangement with the Borrower and Harmoney has the financial arrangement with the the Investor?
I understand it to be both have an agreement with the trustee and Harmoney is merely the trustee's agent.
Hi there Knot and Bjauck
I refer you to the Harmoney Disclosure Statement which sets out how the trustee works.
https://www.harmoney.co.nz/how-it-wo...sure-statement
OMG..... Now i see on offer an A4 with a monthly income of $45,431.00 ..... LAI-00058406 !!!!
I say with tongue in cheek .. surely this person shouldn't need to borrow from the likes of Harmoney!!!
Obviously a typo BUT that should not happen.
Hi Darchie - yes this is a bug - and we are fixing it immediately. Thanks for bringing it to our attention. Monica.mathis@harmoney.co.nz
I'm not sure if this is a bug, something new, or I have been blind in the past.
All my loans now show an amount in the service fee section. I don't know if this is what the fee will be for each repayment, the total so far (better not be), or something else?
Attachment 7919
Hi Knot (& Mathismo)
I had a quick look at different loans (paid off, charge off, current, new, etc) and realised that the $ figure for service fee is just 1.25% of the principal we invested. So, it is not much information as it is not the amount charged or the amount to be charged (which includes 1.25% on interest) as well. So, it does not tell us anything new at all! A meaningful figure would be the actual service fee that was charged!
Im looking into this for you now. Get back to you asap. Monica.mathis@harmoney.co.nz
Seems to be a bit of a rounding issue too, a single note ($25) has a service fee of $0.31, two notes ($50) has a service fee of $0.63. I would of expected 2 notes to be double 1 note if it is 1.25% of the principal. The only thing I can think of is the round up/down issue I have seen in other parts of the website strikes again.
Personally I am not interested in rounded figures, they don't give me accurate information, just give me the complete data in an exportable format (or even better, an API I can query).
Completely get that - we have removed the figure as it appears to be pulling incorrectly from the API. Will be back in touch soon. Monica.mathis@harmoney.co.nz
Please see our FAQs for Investors online for 'rounding'. https://www.harmoney.co.nz/how-it-works/investor-faq
Regards Monica.mathis@harmoney.co.nz
New faq section? Now that I think about it, it would be useful to know when the faq had last been updated.
I get the rounding of numbers, and I pretty much ignore what I consider rounding errors on the site, but as someone who likes to track things closely I'm not that interested in rounded numbers, I'd much prefer the real number in the export files (aka 8 decimal places), the web interface I can live with being rounded to $xxx.xx style numbers as it is only useful for quick reference anyway.
Because the export of data is limited, we have to calculate ourselves other data from that, in excel for some, or python/javascript in my case. (Example if I want to know detailed transactions per loan I have to calculate the value of principal and interest on each payment from the difference between two csv exports, I can't simply look them up because I only receive an incremental amount for each loan.) I am hoping that in the future a proper tranaction history will be made available.
I am not trying to be negative, I love the Harmoney platform, I just want it better :)
Hi Monica
Is there any update on this ... given it is march
WHEN WILL PAYMENT PROTECT BE OPEN TO RETAIL INVESTORS?
We expect this product to be available by approximately mid-February 2016. But don't worry; we will notify you as soon as we can with an exact date.
I do get the feeling this thread has pulled up on momentum somewhat!
But i have a couple of questions for Monica
Is there any plan to allow joint investors to register? This is an important question ...
And Mark's told me that the 1.25% fee charged on both interest & principal (which is LETHAL on our returns on these reoccurring Re-Writes) ... is going to be addressed ...
I ask when is this dreadful fee structure going to be fixed? .... I'd like to know what's happening with this, as i will not plonk any more funds into Harmoney until this is addressed.
Awaiting your response Monica
I would like to hear about the latest plans for a secondary market - the lack of one is stopping me investing more.
How about just getting the institutional funders to agree to purchase any loans from retail investors at their face value of outstanding principal?
Thanks for sharing. I'm up to about 170 loans now after 3 months. No bad results yet. Takes time to get momentum. Will report after the first 6 months results are in
It depends which grades of loans your money is in. If A and even B grades start to see serious numbers of charge-offs, then I would guess many other financial investments are in trouble with share prices falling and the possibility arising of hair-cuts at big banks. Redundancy and/or Bankruptcy of house-owners, whether owner-occupied or investment rental, would mean the property-bubble would be collapsing, so bricks and mortar would be no refuge in such a situation I imagine.
Is anyone else experiencing 'Lock Ups' and incomplete Pages loading on Harmoney this week? Nearly every other time I am finding when I click on INVEST it fails to load and show any loans?
No problems here. And the updates that came thorugh yesterday look good (Graph of your RAR and investor statements.).
We are still in Private Beta phase - and we hope to go live soon. Be in touch soon. Monica.mathis@harmoney.co.nz
Hi there Darchie.
We are working on the new fee structure and this should be announced shortly. And it will address the rewrite. I'll check on the joint investors - not one that I am aware of that has been asked for by others. Monica.mathis@harmoney.co.nz
Check your filters - might need widening to ensure there are loans to see. Monica.mathis@harmoney.co.nz
And you can now see borrower details in your purchased loans - click on the ID - and borrower details are there to view. monica.mathis@harmoney.co.nz
Hi mathismo
Having this swift access to borrower details is Really really Good .. but it's made me realise just how often I relied on checking the:
... 'actual amount they'd borrowed' ...
would be helpful to see that figure included in the detail, if possible!
and Having access to the more user friendly transaction statements is GR8.
Very helpful Ta
What's other peoples experience with loans going into arrears at the first payment?
Thx Saamee. So you've never received any payments on those ten loans? Getting into arrears on the first payment surprises me. Perhaps I'd be less surprised if it was an E or F category loan, more surprised on A or B loans. I would be interested to know the typical profile of delinquent loans. So not what percentage have been deliquent, but when it happens eg. http://blog.zopa.com/2006/07/13/bad-debt-rates/
2 so far have never made a payment
Thanks so much for your feedback. We will try and get this in as soon as possible. Great idea. Monica.mathis@harmoney.co.nz
Hi Saamee and Kiwi on OE - the first payment for all new loans is the date, one month past the contract date. In New Zealand it is quite normal for people to try and align their payments to their PAYE or income date. Often if this date is later than the contract date, this can mean they miss their first payment, however the repair rate is very very high indeed. Monica.mathis@harmoney.co.nz
losing your principal is never a minor concern.
Arrears > Accurate Status update now I'm by the PC!
Attachment 7929
Thx for sharing that Saamee. I find it interesting, because the link I shared indicates that delinquencies could probably be expected to increase linearly over time for the first year or so before levelling out. Your experience shows two things 1) most delinquencies started in the first month, 2) the other delinquencies may have been increasing linearly.
Monica, this pattern of delinquencies in the first month is a bit troubling to me. Are you able to share any stats about the patterns/timings of delinquencies that are happening in the overall portfolio?
As I said, the repair rate is extremely high. thanks for your comments - I will answer questions where I can help. Monica.maths@harmoney.co.nz
Today a 'good read' ( below ) article on P2P and Taxation on Interest.co.nz
http://www.interest.co.nz/opinion/80...rk-p2p-lending