General update email received, this is the existing loanbook update in full for those interested. Think the pipeline bit has been noted
here, the other pipeline update being the go-live tomorrow on DFL024.
"EXISTING LOANBOOK
DFL001 - The borrower is now concentrating on finishing Plots 1 to 4, with Plot 1 being the Show Home, and these plots should be finished by mid-May. The borrower is hopeful of early sales on these plots.
An extension is likely to be required on the loan, which is now being discussed.
DFL002 - Borrower's Solicitors have been dealing with the creation of new leases in readiness for sales of units and the Borrower is progressing a sale of the ground floor unit (based on the investment value), which they are hopeful of completing in May.
DFL003 - No change.
DFL004 - Lendy's Development Director visited the site on 21st April. Works are progressing well, albeit a bit behind programme so facility
may need to be extended by up to 3 months to allow for Practical Completion and refinance of the facility. The borrower has now obtained/ provided indicative terms from a Private Rented Sector (PRS) Guarantee Scheme, which he has been in discussion with for several months as previously advised. The borrower is also considering other options to ensure the smooth refinance prior to expiry.
DFL005 - Development tranche was drawn this week.
DFL006 - No change.
DFL007 - Independent Monitoring Surveyor's report has been delayed but is now due next week.
DFL008 - Latest Independent Monitoring Surveyor report received this week so
next tranche drawdown should be next week.DFL009 - Final development tranche was drawn this week.
DFL010 - No change.
DFL011 - Independent Monitoring Surveyor's report has been delayed but is now due next week.
DFL012 - Development tranche was drawn this week.
DFL013 - No change.
DFL014 - Independent Monitoring Surveyor has advised that he is just waiting on a few more bits of information before being able to finalise his report.
DFL015 - Development tranche was drawn last week.
DFL016 - No change.
DFL017 - Loan drawn 25th April 2017.
DFL018 - Update requested from Independent Monitoring Surveyor and Borrower.
DFL019 - Construction documentation now being finalised through our Panel Solicitors, with works on site due to commence shortly.
DFL020 - No change.
DFL021 - Loan completed on 27th April 2017.
DFL022 - Loan drawn 26th April 2017.
DFL023 - Loan due to complete over next few days.
PBL027 - As negotiations and discussions have become protracted with the Borrower
we have engaged with an insolvency practitioner and requested a detailed plan to be provided in conjunction with industry specialists.
PBL031 -
We have engaged our receivers to assist with the repayment of this loan.PBL037; PBL038; PBL039; PBL069; PBL070; PBL071 - No solid offers as yet but there is interest and we expect to receive tangible offers shortly.
PBL040 -
We are expecting full repayment early next week. PBL046 - Being refinanced with Together. Hoping for some further details early next week.
PBL047 -
Expecting full repayment by mid May. PBL055 - No change.
PBL056 - Sale continuing through legals.
PBL057 - No change.
PBL064 - The property is being marketed and we anticipate offers within the next month.
PBL065 - We are reviewing options to get the best outcome for this loan.
PBL066; PBL067 - Negotiations over potential sale continue.
PBL068 - Solicitors are in funds for a proportion of the outstanding debt,
we expect full repayment mid May.
PBL074 - Our agents are visiting the site shortly to confirm it is being cleaned up and the lease is being adhered to. Selling agents have been appointed and there are a couple of interested parties.
In the event that no interest is confirmed prior to the completion of the clean up it will be placed in auction. PBL075 -
We are expecting full repayment imminently. PBL081 - Independent Monitoring Surveyor has now visited site. Given the length of time to get to this point, there are some cosmetic repairs required to the paintwork, which will be completed over next few weeks.
PBL082 - The formal recovery process has started and
we have instructed our receivers to help with the repayment of this loan.
PBL084 - We are working with the borrower to produce accounts and other requirements for a term lender to provide long term finance.
PBL088 - We are chasing the borrower for repayment of this loan.
PBL089 -
Borrower is nearing redemption.PBL094 - We are expecting an offer of refinance within 7 days. We met with the borrower and interested parties yesterday.
PBL095 - New lender is waiting on a valuation report as part of their due diligence before redeeming us.
PBL098 - We are in discussions with the borrower regarding the exit of this loan.
PBL101; PBL102 - We are continuing to work with our lawyers to expedite repayment.
PBL103 - Further discussions with both Valuer and Monitoring Surveyor this week in order to progress reports which should now be received over next few weeks.
PBL106 - The new lender is still awaiting the valuation report. Planning extension is being submitted to extend the current planning on the site.
PBL107; PBL108; PBL112 - The borrower is currently still working on the refinance of their loan.
PBL120 - No change.
PBL123 - We are still working with the borrower in regards to the sale of the property.
PBL125 - The borrower is finalising the sale of barns.
PBL126; PBL130 - No change.
PBL132 - The borrower is waiting on a response regarding the access road for the proposed planning.
PBL133 - Borrower continues to work with another lender on the refinance of this loan.
PBL137 - We are in discussion with the borrower regarding
a further one month extension whilst the borrower completes the refinance with another lender.
PBL139 - We are in discussion with the borrower regarding
a further one month extension whilst the borrower completes the refinance with another lender.
PBL141 -
The borrower has extended the loan for one month whilst they refinance with another lender.
PBL142 - Planning has not yet been obtained so Borrower will be providing cash to cover interest
to extend facility by one month.
PBL143 - No change.
PBL144 - We are currently working with the borrower while they refinance to another lender and we are looking at a possible short extension.
PBL145 - Borrower is in advance negotiations regarding redemption.
PBL147 - The borrower is still proceeding with the refinance of this loan.
PBL148; PBL149; PBL150; PBL151; PBL152; PBL153; PBL154 - No change.
PBL155 - The borrower is currently liaising with a long term finance lender; in order to redeem a substantial amount of the debt.
PBL156; PBL157; PBL158; PBL159 - No change.
PBL160 - We have initiated conversations with the borrower in regards to the repayment of this loan.
PBL161; PBL162; PBL163; PBL164; PBL165 - No change.
PBL166 - We are working with the borrower to produce accounts and other requirements for a term lender to provide long term finance.
PBL167 - This loan was drawn down on the 25/04/17.
PBL168; PBL169; PBL170; PBL172 - No change.
PBL174 - No change since loan drawn on 21st April 2017.
PBL175 - This loan has recently completed. "
Bank holiday weather outlook and other information
"As the government tightens its purse strings, as borrowing falls to its lowest level since the 2008 crash, the P2P sector has been loosening them with the news this week that lending hit £1bn in the first quarter alone, bringing the cumulative total to over £10bn. A sure sign that the sector continues to mature as it moves from alternative finance to main challenger to the traditional banks.
Rigorous due diligence
But to do so we believe P2P platforms need to build on best practice in the lending market whilst also striving to provide excellent service to their customers and by ensuring rigorous due diligence is undertaken on every loan approved.
I touched on this in a previous update. But as due diligence is one of the most frequently asked questions I get asked, I thought it useful to explain the five key steps we take in our factual and legal investigations, research, analysis and discovery into the relevant borrower, their asset or assets, and any sponsor/or principal parties.
The five-step DD process 1. Initial due diligence
Our experienced business development managers carry out an extensive ‘know your customer’ (KYC) process when they first source a loan. Their checks include background searches into the prospective borrower, credit and anti-money laundering screenings, and, in most cases, interviews with the borrower.
2. Legal panel
After the loan has passed the first stage it is then reviewed by a member of our legal panel. The panel is made up of three Top 100 law firms; D** B*********, S********** and C****** W*******, with all three law firms on holding a minimum of £10m professional indemnity (PI) insurance. For certain projects we also use W***** G******, which has £3m PI cover, and for loans secured against Scottish property Lendy uses G******** M********, which has £25m PI cover.
Our solicitors ensure that a legal charge is properly made against each security property, and that each of the security properties has good title. The solicitors also ensure that if a borrower grants additional security, such as guarantees and debentures, that these securities are properly executed and enforceable.
3. Valuation
We use a number of highly rated independent firms to value security properties. Each firm will be a specialist in the region where the property is located. The firm will use a RICS registered valuer who is able to carry out a full red book valuation. They will also have significant PI cover.
4. Credit checks
Our Head of Credit, M*** W*******, previously at HSBC, with over 35 years’ credit processing experience, puts each lending proposition under extensive scrutiny to determine its viability. This will include an analysis of the borrower’s/sponsor’s and/or other principal parties’ experience, credit record, business plan and financial projections and forecasts with particular regard to the borrower’s financial situation including their ability to service the debt and repay the loan at maturity.
5. Credit Committee
Once the full process has been completed, our Credit Committee will then consider and approve each lending opportunity before it is put to investors on the platform.
An Independent Monitoring Surveyor (IMS), who will certify build costs and satisfactory progress of the development, then monitors progress of a development finance project. Drawdowns from the loan will be made based on the IMS interim reports.
Investing in growth
As we’ve grown we’ve made sure to invest in the resources and manpower needed to undertake thorough checks into each loan we receive; with the added knowledge we have in place we believe we have a due diligence process that rivals, if not surpasses, the major high street banks, with our use of expert lawyers and specialist RICS-registered valuers, along with our own internal expertise.
That's it for another week. For an update on the current loan book please see below.
From all of us in sunny Southsea, have a great bank holiday weekend.
Paul
Head of Marketing and Communications "
I'm sure the 5 step DD process will be the subject of much discussion