des
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Post by des on Oct 24, 2018 9:34:28 GMT
Wednesday 24th October 2018 - Loan Launch Details:
Borrower Sector: Agricultural.
Amount: £750,000.
Term: 12 months (6 months minimum term).
Rate: 15% - Interest Only.
Security: Company debenture, 2nd ranking legal charges, personal guarantees from principals.
Instant Returns: Enabled.
Loan Launch: 10am - 24th October 2018 (READ ONLY).
Loan Live: 2pm - 24th October 2018.
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kaya
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Post by kaya on Oct 24, 2018 9:55:32 GMT
Just from the brief description, the business sounds like it is going broke somewhat financially restrained.
But I'm no accountant, what do I know.
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Post by fatbritabroad on Oct 24, 2018 10:10:49 GMT
With a furrowed brow I've reviewed the prospectus and can't make my mind up? It looks potentially a rich harvest and at least a new borrower
I expect ablrate will be fielding some questions on this one
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markyg61
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Post by markyg61 on Oct 24, 2018 10:19:28 GMT
With a furrowed brow I've reviewed the prospectus and can't make my mind up? It looks potentially a rich harvest and at least a new borrower I expect ablrate will be fielding some questions on this one It could prove fruitful 
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hector
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Post by hector on Oct 24, 2018 10:52:41 GMT
With a furrowed brow I've reviewed the prospectus and can't make my mind up? It looks potentially a rich harvest and at least a new borrower I expect ablrate will be fielding some questions on this one It could prove fruitful We don't want another rotten apple 
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invester
P2P Blogger
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Post by invester on Oct 24, 2018 11:00:24 GMT
Doesn't look too good to me, sorry. Not with a second charge. LTV is 70% at market, and if things go wrong it seems unlikely that market prices are ever achievable. The first charge looks fairly solid.
With the level of profits here there is not much room if there was an adverse event in one of the inputs, for example, a steep rise in labour costs owing to Brexit, drop in demand for products. Not as if the inventory can be stored.
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Post by scottdt on Oct 24, 2018 11:03:31 GMT
I haven’t made my decision on whether to invest yet but 4 months interest is being retained so I assume that guarantees a 5% return reducing the risk slightly.
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boundah
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Post by boundah on Oct 24, 2018 11:34:58 GMT
The heady mix of 2nd charge, 70% LTV (going up to almost 100% in fire-sale), history of CCJs against the borrower and possibly optimistic profit forecast makes me a tad nervous. That said, I’m ever the optimist with regard to ABL’s judgment so may pitch in a few quid.
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ceejay
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Post by ceejay on Oct 24, 2018 11:39:09 GMT
I haven’t made my decision on whether to invest yet but 4 months interest is being retained so I assume that guarantees a 5% return reducing the risk slightly. No. It guarantees that you get 5% interest payment to you, to be added to whatever capital loss that might be incurred. The Risk with these deals isn't that you don't get your due interest payment - its that you don't get your capital back.
I'd like to like this loan, but second ranking charge in a volatile industry that is especially vulnerable to Brexit?
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blender
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Post by blender on Oct 24, 2018 12:31:26 GMT
The second charge is an issue, but at least the valuations are on land and existing businesses as valued currently, and not dependent upon some future successful development.
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snowmobile
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Post by snowmobile on Oct 24, 2018 12:34:46 GMT
ablrate are the loans being fully used to repay the existing lender? Is the the amount (stated on page 5) owing to the previous lender up to date? I ask because the total loans amount to £600k more than this figure. Whilst retained interest and fees will account for some of the difference it seems a lot. Is there some element of business cashflow support, as with the last refinance in 2017?
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Post by ladywhitenap on Oct 24, 2018 12:35:27 GMT
The ink is hardly dry on the borrowers company at Co House!!
M*****S Developments Ltd was incorporated day before yesterday.
Does not automatically make it bad but in combination with everything else, I'll be watching from the back row.
LW
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Post by Deleted on Oct 24, 2018 13:27:15 GMT
Well, from the family business point of view I'm not sure what else they can do. They owe money and hold land/businesses which need selling. Not a serious punt from me.
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Post by ladywhitenap on Oct 24, 2018 13:58:15 GMT
Well, from the family business point of view I'm not sure what else they can do. They owe money and hold land/businesses which need selling. Not a serious punt from me. Well unless the rate of interest on the money they currently owe is even greater than of charged by ABL and the other loan company, then surely they would be best served by getting on and selling some assets PDQ. Not comfortable with this one. LW
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dh1
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Post by dh1 on Oct 24, 2018 14:36:56 GMT
Could be that the rate of interest - more directly than usual - reflects the risk(s)?
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