michaelc
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Post by michaelc on Dec 17, 2016 17:05:48 GMT
Not sure if the previous loans for this have posted this before but as of today the property is showing in Zoopla with a "valuation" of £1.27M. Last sale was in 2000 for £365K. So Zoopla's estimate is largely based on house price inflation in that area since then.
It does look like next door is the subject of significant development. Planning has been approved to demolish the pair of semis and replace with 15 flats and there are further planning apps under consideration. I don't believe Zoopla can easily (or at all) factor in. Also, FS's valuation was done before planning was obtained and certainly before demolition.
I'll let others judge whether and to what extent that might affect a resale price. Personally I think it will have an affect but I couldn't see the place being sold for much less than £1M (general bubble crash not withstanding) so I plan to go in at around 50% of my upper limit on this one.
What do others think?
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Post by eascogo on Dec 17, 2016 22:42:32 GMT
Not sure if the previous loans for this have posted this before but as of today the property is showing in Zoopla with a "valuation" of £1.27M. Last sale was in 2000 for £365K. So Zoopla's estimate is largely based on house price inflation in that area since then. It does look like next door is the subject of significant development. Planning has been approved to demolish the pair of semis and replace with 15 flats and there are further planning apps under consideration. I don't believe Zoopla can easily (or at all) factor in. Also, FS's valuation was done before planning was obtained and certainly before demolition.
I'll let others judge whether and to what extent that might affect a resale price. Personally I think it will have an affect but I couldn't see the place being sold for much less than £1M (general bubble crash not withstanding) so I plan to go in at around 50% of my upper limit on this one.
What do others think? michaelc. The valuation dates from July 2015 and this property will have appreciated since then. I know the area and IMO the valuation is better reflected by the one at Zoopla. I have been in this loan from the start. My hunch is that the loan will redeem well ahead of the 6-month term. If a development next door goes ahead that may affect the pricing but I think the valuation would still hold well.
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jamesc
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Post by jamesc on Dec 19, 2016 12:25:37 GMT
Well I really like this loan which is why I have placed 12% of my total P2P investment into this loan, shame the 2nd charge has been rolled into this so increasing the LTV but as somewhat says the valuation has probably appreciated since the last valuation was done, somewhat surprised it has not filled yet maybe the big question why this lender still financing through P2P inflated rates and not a much cheaper residential Mortgage. If this was on SS it would 9%, my principal concern is that it repays after a month of so leaving the usual reinvestment problems !
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michaelc
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Post by michaelc on Dec 19, 2016 14:43:51 GMT
Yes, perhaps I should have been more explicit - on balance I also like the loan. The majority of my loans go in at my self-determined minimum exposure so half way to the highest I'm prepared to go on any loan is quite good going for me. If we get some more positive comments I might up it even more By the way, how did you find it? For me the KFC in one of the pictures made it a lot easier.
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jamesc
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Post by jamesc on Dec 19, 2016 14:54:53 GMT
Yes, perhaps I should have been more explicit - on balance I also like the loan. The majority of my loans go in at my self-determined minimum exposure so half way to the highest I'm prepared to go on any loan is quite good going for me. If we get some more positive comments I might up it even more By the way, how did you find it? For me the KFC in one of the pictures made it a lot easier. That's really funny because that is exactly how I found it
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Post by charpy on Dec 19, 2016 21:39:10 GMT
It can be off-putting when the original loan being renewed is paid late, and doubt about why. Had a quick look at one of the house price indices which indicated fairly static prices overall in the B****** area since the valuation date back in 2015, and perhaps this is why a new valuation wasn't needed. This loan seems to be steadily filling with some hefty inputs so it looks like some out there have solid reasons for lending on this one?
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michaelc
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Post by michaelc on Aug 12, 2017 22:25:03 GMT
Well I really like this loan which is why I have placed 12% of my total P2P investment into this loan.... Do you think its safe now?
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Post by eascogo on Aug 13, 2017 0:14:46 GMT
Well I really like this loan which is why I have placed 12% of my total P2P investment into this loan.... Do you think its safe now? Indeed, I'd be worried about this loan. Initial £600,000 loan in Feb2016, plus extra £100,000 lent in Dec2016 with both loans consolidated but now, eight months on, refinancing has failed. It looks like one more of those loans that could end up with a problem.
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pa
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Post by pa on Aug 13, 2017 8:55:24 GMT
Do you think its safe now? Indeed, I'd be worried about this loan. Initial £600,000 loan in Feb2016, plus extra £100,000 lent in Dec2016 with both loans consolidated but now, eight months on, refinancing has failed. It looks like one more of those loans that could end up with a problem. This property is local to me. Since the loan original valuation report in 2015 was issued the property next door down has been demolished, along with some old garages which backed on to it. It is now effectively next to a large building site (I haven't searched for the plans but would guess for at about 20 flats over several stories judging by the footprint). I'm not in this loan and don't want to speculate but I can understand why a company "confirmed all aspects were acceptable" but decided not go ahead with the refinancing. I don't want to fall foul of forum rules (mods please edit if I have) but it you look at the valuation report there is one instance of the road name being unredacted (hint: Section 6, Paragraph 6) you can see the Google Street view from June 2016 when the site was cleared to give you some idea of the scope of the development (the door of the property has been changed and is a different colour). In street view if you go down the alley the data is from 2015 and the "demolished" house reappears so you can see what was originally there. I'm afraid that I haven't got any more information to add.
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SteveT
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Post by SteveT on Aug 13, 2017 9:17:49 GMT
I don't want to fall foul of forum rules (mods please edit if I have) (Mod hat on) No need to. A well-crafted post that reveals useful information to registered FS lenders but maintains lender confidentiality to anyone else. Keep up the good work.
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Post by panache on Aug 14, 2017 20:37:06 GMT
There is also a website for the development (its address) that says the flats will be ready for accomodation by January 2018. I managed to go past recently and the shell is still being built.
It is a two and three story L shaped building wiith the gardens of the two properties adjacent. If the building works are the reason for the financing issues then the borrowers proposal seems sensible to me.
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mikes1531
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Post by mikes1531 on Sept 29, 2017 15:59:09 GMT
Note to Mods: I looked for an old thread for this loan but didn't finds one. If I've missed one, please feel free to merge this thread with the old one. Thanks. fundingsecure: Let me see if I understand this correctly... - The borrower seems to have made multiple attempts to refinance this loan and has been unsuccessful so far.
- The borrower is unable to pay all the accrued interest/fees from other resources. (Considering how overdue this loan is, they must have been able to come up with about £100k, so they do deserve a bit of credit.)
- The borrower was going to pledge extra 'security' in order to raise the funds for renewal, but it hasn't been possible to arrange this in a reasonable amount of time. (It first was mentioned in an update seven weeks ago.)
- The borrower is being rewarded for their performance to date by being given a lower interest rate on the larger renewal loan than on their current loan which is more than three months overdue.
But what I'd really like to know is... Is there a viable exit plan? If so, what is it? How is the borrower going to repay their loan in six months' time?
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Post by mrclondon on Sept 29, 2017 16:58:24 GMT
Very valid questions mikes1531 . (And yes, there was a previous thread which I've merged into this one) Both this renewal and the previous one (last Dec) are/were 3.5 to 4 months overdue, and not all the interest has been paid. The adjacent development of flats severely impacts on this property with the rear garden now badly overlooked / overshadowed, and is being blamed for the possible new internal crack (see new VR section 10.3 and photo of stairs on the last page). The property is still in the tired state it has always been in. 90 day marketing valuation is stated as £925k (20% below stated OMV of £1.15m) and equivalent to 78% LTV. Will obviously be very slow to sell, but there feels IMO enough headroom for a full recovery of capital and acrued interest from a fire sale auction. The drop in the interest rate to 12% doesn't feel warranted as the property can not be considered to be more marketable than previously.
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Post by eascogo on Sept 29, 2017 23:27:12 GMT
Note to Mods: I looked for an old thread for this loan but didn't finds one. If I've missed one, please feel free to merge this thread with the old one. Thanks. fundingsecure : Let me see if I understand this correctly... - The borrower seems to have made multiple attempts to refinance this loan and has been unsuccessful so far.
- The borrower is unable to pay all the accrued interest/fees from other resources. (Considering how overdue this loan is, they must have been able to come up with about £100k, so they do deserve a bit of credit.)
- The borrower was going to pledge extra 'security' in order to raise the funds for renewal, but it hasn't been possible to arrange this in a reasonable amount of time. (It first was mentioned in an update seven weeks ago.)
- The borrower is being rewarded for their performance to date by being given a lower interest rate on the larger renewal loan than on their current loan which is more than three months overdue.
But what I'd really like to know is... Is there a viable exit plan? If so, what is it? How is the borrower going to repay their loan in six months' time? The initial loan (2548475241) was in May 2015 for £600,000 against a valuation of £1,100,000. The loan was subsequently renewed and increased by £100,000. Attempts at refinancing were inconclusive. Now, nearly 2-1/2 years later, another renewal is proposed with a small increase of £20,000 (to cover a shortfall in the interest due). Looking at the latest valuation of 22/06/2017 the figure of £1,150,000 shows very little change in value since 2015. Further the property, though modernised some 4 years ago, has suffered some dilapidation, presumably caused by high occupancy. The report assumes that the property is let under assured short-hold tenancy. There are signs of minor structural damage possibly caused by extensive building works nearby. Further a block of flats is nearing completion is overlooking the rear garden. The rental quoted is higher than average probably because of high occupancy. However even this high rental covers only about half the loan interest. Given the loan duration the interest paid by the borrower is significant and set to increase if the renewal goes ahead. Also if a sale is to take place the property would benefit from a lickover to achieve a good price. If the borrower is short of funds that may not be an option. I would therefore look at the figure for the 90-day valuation (£925,000) as potentially relevant. FYI I am no longer invested in this loan.
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mikes1531
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Post by mikes1531 on Sept 30, 2017 1:25:05 GMT
Given the loan duration the interest paid by the borrower is significant and set to increase if the renewal goes ahead. Also if a sale is to take place the property would benefit from a lickover to achieve a good price. If the borrower is short of funds that may not be an option. I would therefore look at the figure for the 90-day valuation (£925,000) as potentially relevant. FYI I am no longer invested in this loan. eascogo: Thanks for your input. I'm not sure why the borrower's interest would increase after the renewal. Yes, the balance is up, but only by a little (£720k vs. £700k), but the interest rate has dropped from 13% to 12%. That assumes, of course, that the reduced interest rate to investors is passed through to the borrower. If, OTOH, FS have left the borrower's rate is unchanged... I agree that the sale price in a recovery situation likely would be be closer to £925k than £1.15M but, as was pointed out above, that still ought to produce sufficient proceeds to repay the £720k loan plus all accrued interest/fees. Presuming, of course, that it doesn't take too long before the sale occurs. If FS allow the borrower to stall the recovery process for 3-4 months, as they have in the past, and receivers aren't called in until some time after that, then a full recovery would be harder to achieve.
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