Uk Mortgages Share Discussion Threads

[rambutan2] 22/10/2019 20:58

Info re recent changes etc:

[stemis] 19/12/2017 09:25

I think the reason they aren't generating enough income is because they have basically struggled to deploy all their capital. There has been 'some' recent progress in that respect and Twentyfour Asset Management have agreed a reduced management fee but even the company don't think the dividend will be covered until 2020.

[yieldsearch] 19/12/2017 08:45

hmm ok tks. scburbs...so i guess promised a dvd and cannot achieve it

[scburbs] 19/12/2017 08:18

Hi Yieldsearch,

The assets are performing well they just don’t currently generate enough net income to cover the dividend, hence the falling NAV.

[yieldsearch] 18/12/2017 21:41

Anyone can explain why the NAV is down to 87? the mortgage market is UK is fine no??

[stemis] 09/12/2016 10:09

Continuation vote passed

[stemis] 25/11/2016 08:58

Price has drifted down to NAV. Presumably in light of imminent continuation vote?

[stemis] 02/11/2016 22:45

It was just a illustration rather than a forecast. I've used the Nationwide BS mortgage rates rather than what UKML are actually receiving on the assumption that UKML would need to offer a comparable rate to prevent widespread switching. Maybe their higher rate (currently 3.36%) will stick and there'll be upside. Actually they've achieved greater leverage on the first batch of mortgages (6.8 x) so that should help returns. Defaults are clearly a risk. I'm guessing they must have made some assumptions in their rate of return as it looks low just on the above numbers.

(For information I don't currently hold. I'm just trying to get my head round the numbers)

[yieldsearch] 02/11/2016 14:50

Yes in your example ukml is receiving libor on 500 and paying on 400. Rising interest rate could impact also the mortgage pool, people may prepay more of their mortgage or could switch to another mortgage providing a cheaper rate, this shortening the average life..and also high interest rate could also mean potentially more mortgage default which would be bad news for the junior position held by ukml if losses are hitting.

[stemis] 02/11/2016 14:30

This is how it works. Current mortgage rates are about 3.2% (Nationwide). UKML use leverage at 4 x capital to debt fund these at 3 mth Libor (0.4%) + 1.35% = 1.75%. Total costs are about 1.2% of capital. So:-


Mortgage 500 x 3.2% 16.0Debt 400 x 1.75% -7.0Costs 1.2% -1.2---------------------------Capital 100 7.8


However if all rates go up by 1%


Mortgage 500 x 4.2% 21.0Debt 400 x 2.75% -11.0Costs 1.2% -1.2---------------------------Capital 100 8.8



So a rise in interest rates would benefit UKML?

[stemis] 02/11/2016 14:11

Thanks. I'd forgotten all about this.

[jaws6] 20/7/2015 09:53

good luck.I hold some.

[stemis] 20/7/2015 09:45

hxxp://www.twentyfouram.com/funds-and-services/uk-mortgages-ltd

The Fund aims to provide Shareholders with stable income returns through low leveraged exposure to portfolios of loans secured against UK residential property

The Fund is targeting a net total return of 7-10% per annum

Fund Charges & Costs - 0.75% of lower of NAV and market cap

PROSPECTUS - hxxp://www.twentyfouram.com/sites/default/files/upload/images/UKML%20Prospectus.pdf