james21
Member of DD Central
Posts: 651 
Likes: 669
|
Post by james21 on Aug 22, 2019 16:41:37 GMT
Getting a lot of this now, so why doesn't someone jump in a car and do a round robin to all these borrowers, and talk to them? surely that going to be productive? ask neighbours etc unless offshore or something. So why can they not get through on the phones, if the HQ number is blocked just use someones mobile, something very wrong with all this somewhere. Also to keep declaring this it puts the wind up the lenders so is very poor management judgement to put these updates out, but we should not be surprised about that, they are pretty bad at running a business as lenders know
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Aug 22, 2019 16:51:33 GMT
Totally agree- if not already done being contactable along with a reserve contact number should be in the contract. If no joy then send a letter via recorded delivery to their address.
|
|
p2ploser
Member of DD Central
Posts: 163
Likes: 221
|
Post by p2ploser on Aug 22, 2019 17:53:57 GMT
Sounds like you’re thinking they are actually interested in getting our money back. They have clearly no interest in keeping investors happy else they would have been more proactive a long time ago.
|
|
bugs4me
Member of DD Central
Posts: 1,841
Likes: 1,466
|
Post by bugs4me on Aug 22, 2019 21:43:02 GMT
Getting a lot of this now, so why doesn't someone jump in a car and do a round robin to all these borrowers, and talk to them? surely that going to be productive? ask neighbours etc unless offshore or something. So why can they not get through on the phones, if the HQ number is blocked just use someones mobile, something very wrong with all this somewhere. Also to keep declaring this it puts the wind up the lenders so is very poor management judgement to put these updates out, but we should not be surprised about that, they are pretty bad at running a business as lenders know Why would they - FS that is. FS must be fully aware that many of the disgruntled lenders are not going to reinvest and are simply looking to move on. We all know that the platform default stats are well and truly manipulated to show FS in a more favourable light.
The sums are simple - if you took say 11 loans and invested say £1000 at 12% in each with 10 repaying on time after six months then you'd be £600 up. The 11th loan defaults - to keep it simple say on month 6 although we all know it will be can kicking time so could go on for years. But in a perfect world if you achieved say a 50% capital return which is a moot point then over that 6 month period your gross return would have been £100 or less than 1%. Is anyone going to reinvest.
The reality is that you may or may not see that final loan returned - well not in the near future anyway so you're in negative territory.
So in effect you're a 'lost' investor for FS. Why bother with you when there are others willing to gamble lend especially as I read that FS have some wealthy individuals lurking in the wings.
No proof just me being cynical but I would suggest FS, in their current MO are in wind-down mode. If loans continue being funded then keep the books open. Once the music stops then all those defaulted loans whether they have been formally defaulted or not - well it's whistle in the wind time sadly for those folks that have funds tied up in them. And it could of course have been so different could it not?
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Aug 22, 2019 23:05:47 GMT
totally agree - I notice there are now loads of p2p property companies who, as I see it, are basically lending to people and companies whom the bank won't touch (and probably with good reason). In a classic pawn model the money is lent against a sellable asset e.g. a Rolex watch with a pretty consistent market value. In the p2p world of property lending not only is the housing market subject to changes , in fact I think the UK market is going to correct very soon, but a lot of the p2p loans seem to be for very fanciful and unrealised projects where the lenders are ether pretty clueless about the building game or very switched on about shafting lending companies for money. In short there is too much money sloshing around the p2p world chasing dodgy propositions and sooner or later I think it will implode; FS aren't in the strongest position to withstand this. Once this happens the FSA will actually have to do something such as introducing much stricter legislation but until then I am out.
|
|
james21
Member of DD Central
Posts: 651
Likes: 669
|
Post by james21 on Aug 23, 2019 9:06:00 GMT
Getting a lot of this now, so why doesn't someone jump in a car and do a round robin to all these borrowers, and talk to them? surely that going to be productive? ask neighbours etc unless offshore or something. So why can they not get through on the phones, if the HQ number is blocked just use someones mobile, something very wrong with all this somewhere. Also to keep declaring this it puts the wind up the lenders so is very poor management judgement to put these updates out, but we should not be surprised about that, they are pretty bad at running a business as lenders know Why would they - FS that is. FS must be fully aware that many of the disgruntled lenders are not going to reinvest and are simply looking to move on. We all know that the platform default stats are well and truly manipulated to show FS in a more favourable light.
The sums are simple - if you took say 11 loans and invested say £1000 at 12% in each with 10 repaying on time after six months then you'd be £600 up. The 11th loan defaults - to keep it simple say on month 6 although we all know it will be can kicking time so could go on for years. But in a perfect world if you achieved say a 50% capital return which is a moot point then over that 6 month period your gross return would have been £100 or less than 1%. Is anyone going to reinvest.
The reality is that you may or may not see that final loan returned - well not in the near future anyway so you're in negative territory.
So in effect you're a 'lost' investor for FS. Why bother with you when there are others willing to gamble lend especially as I read that FS have some wealthy individuals lurking in the wings.
No proof just me being cynical but I would suggest FS are in wind-down mode. If loans continue being funded then keep the books open. Once the music stops then all those defaulted loans whether they have been formally defaulted or not - well it's whistle in the wind time sadly for those folks that have funds tied up in them. And it could of course have been so different could it not?
Some good points, however I dont think there is imminent danger of going out of business, it has the potential to be a very profitable company if they can get the loans back in with interest as they only get paid when that happens, but that is the problem as has been pointed out. You can get an impression of their cash flow these last months by looking at the closed loans that paid interest, there are not many and that is a concern however they had a cash injection earlier in the year from EZ finance secured against the company assets who are effectively the equal owners with Raj Kumar. You wont find a P&L statement on CH because as a small company they have opted out of providing that info. Its all in the public domain. They need to find a business model that borrowers (and lenders) will be attracted to (ie for borrowers maximum £ they can borrow on max LTV) but one that protects FS' income from the loan against the bad borrowers hapless or deliberate. The recent little experiment to get interest paid monthly didnt work but it was not well thought through anyway so no surprise, but did have some merit . So they have a massive backlog of loans that wont pay interest to them or lenders, they will deal with them but I cant see it a priority as there is no money in it for them and they have limited resources to deal with them. There are plenty of new lenders to come in all seeking a good return as the existing ones like us exit but I think the % offered will decline below 13%. So whats the end game for the owners? My guess a float on AIM but that years away
|
|
ozboy
Member of DD Central
Mine's a Large One! (Snigger, snigger .......)
Posts: 3,156
Likes: 4,830
|
Post by ozboy on Aug 23, 2019 12:14:36 GMT
"... if they can get the loans back in with interest as they only get paid when that happens........"Maybe james21, but don't FS pay themselves all their Fees & Charges first, after the sale of a Defaulted property, so they basically never hardly lose, ONLY their long suffering Lenders take the hit on the crumbs left over afterwards?
|
|
james21
Member of DD Central
Posts: 651
Likes: 669
|
Post by james21 on Aug 23, 2019 13:20:38 GMT
"... if they can get the loans back in with interest as they only get paid when that happens........"Maybe james21 , but don't FS pay themselves all their Fees & Charges first, after the sale of a Defaulted property, so they basically never hardly lose, ONLY their long suffering Lenders take the hit on the crumbs left over afterwards? Clearly they dont get the interest. The T&C says 6.2.4 An additional administration fee of 5% of the Loan value will be deducted from the net proceeds of sale of the Asset and paid to FundingSecure (after deduction of all selling expenses such as commissions), in the case of the recent Astbury repayment the return was: Gross Sale Amount: £365,000 less Receivers: £5,000 Consult / Contractors £51,592 (Costs involved in ensuring planning remained live) Agents / Valuers Fees £14,753 Legal Fees £1,600 Legal Disbursements £33 VAT £6,976 Insurance £1,942 Total Deductions: £81,896 Net Amount of recovery: £283,104. What they dont show is the 5% they took ie £24k from the loan value. We dont know what interest rates they charge the borrower clearly they vary, so potentially this loan over 2 years should have given them something like at least £57k at 12% (interest rate could have been higher we dont know) Correct me if someone has a different view
|
|
ozboy
Member of DD Central
Mine's a Large One! (Snigger, snigger .......)
Posts: 3,156
Likes: 4,830
|
Post by ozboy on Aug 23, 2019 14:46:52 GMT
www.fundingsecure.com/terms-and-conditions"8. Fees and Charges
8.1 FundingSecure charges Borrowers an administration fee on every Loan depending on the Loan amount. The rates charged are per month on a daily basis for the duration of the Loan."Very iffy wording, it doesn't actually say when the Administration Fee is charged, it could easily vary and be bespoke per Loan? I don't know.
|
|
p2ploser
Member of DD Central
Posts: 163
Likes: 221
|
Post by p2ploser on Aug 23, 2019 16:02:48 GMT
“My guess a float on AIM but that years away” There’s nothing about this business the will remain afloat I fear  |
|
