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Post by bengilbert on Dec 18, 2015 15:05:49 GMT
We're hoping to have at least one larger loan ready for listing on the platform before Christmas, but in the meantime, we're launching this smaller loan. It will go live next week but the preview is available now.
As you'll see in the description, one reason for putting this loan onto the platform was to try to give lenders some more insight into the life-cycle of a development. Starting from nothing in summer this year, it's now close to completion, and you can see how it progressed via the updates from the valuer which are posted with the loan.
As a p2p lender, I've always found it a bit disconcerting when I've lent on developments and then haven't had much idea of what progress has been made. At Broadoak we'll be trying to keep lenders aware of what's happening through the course of the loan, with photographs, valuers' updates etc for those who are interested in following progress.
I'm afraid I won't be available to respond to questions and comments until Saturday afternoon - the loan is scheduled to go live on Tuesday, though, so that should leave plenty of time.
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SteveT
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Post by SteveT on Dec 19, 2015 12:59:17 GMT
bengilbert, as much for future reference as anything, do you have anything contractual that dictates what happens in the event the borrower finds themselves unable to repay on the scheduled date? I presume interest would carry on accruing but at the same rate or an elevated "penalty" rate? Or would you insist on them refinancing onto another short-term loan with Broadoak prior to the first loan ending? It doubt it would arise with this particular project but I recall another platform's development loan that hit power company connection delays (or it may have been the water connection) very late on in the schedule and suddenly all unit sale completions were held up for several months until it was resolved. Many a slip, etc. etc.
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Post by bengilbert on Dec 19, 2015 15:43:41 GMT
bengilbert, as much for future reference as anything, do you have anything contractual that dictates what happens in the event the borrower finds themselves unable to repay on the scheduled date? I presume interest would carry on accruing but at the same rate or an elevated "penalty" rate? Or would you insist on them refinancing onto another short-term loan with Broadoak prior to the first loan ending? It doubt it would arise with this particular project but I recall another platform's development loan that hit power company connection delays (or it may have been the water connection) very late on in the schedule and suddenly all unit sale completions were held up for several months until it was resolved. Many a slip, etc. etc. If a borrower does not repay on the due date, they are in default, and start to pay penalty interest, which would accrue until the loan is repaid. However, if a borrower anticipates being unable to repay on time, they can request an extension of the loan. If there is merit to the request, Broadoak will then either grant the extension and rebuy the loan from investors on the due date, so that they receive their money on the expected date, or put the extension request to a borrower vote. We do recognise that there are many things that can delay repayment, some under the borrower's control and some less so. This is why we place a lot of emphasis on monitoring loans against targets that come well before the end date (eg progress on a development or evidence of progress towards refinance), so that we are aware of potential delays in advance.
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star dust
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Post by star dust on Dec 19, 2015 18:19:49 GMT
If a borrower does not repay on the due date, they are in default, and start to pay penalty interest, which would accrue until the loan is repaid. Not suggesting there will be any problems with this, or any other loans, and apologies if I've missed it somewhere else, but you stated on another thread that "If a loan goes into default, investors will accrue interest at 1.5% per month while we work on recovering the money." Will the 1.5% per month default interest be the same whatever the original base interest rate of the loan (9-12%), i.e will it be the rate applying should this particular loan default?
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Post by bengilbert on Dec 19, 2015 18:25:27 GMT
If a borrower does not repay on the due date, they are in default, and start to pay penalty interest, which would accrue until the loan is repaid. Not suggesting there will be any problems with this, or any other loans, and apologies if I've missed it somewhere else, but you stated on another thread that "If a loan goes into default, investors will accrue interest at 1.5% per month while we work on recovering the money." Will the 1.5% per month default interest be the same whatever the original base interest rate of the loan (9-12%), i.e will it be the rate applying should this particular loan default? The 1.5% per month is the same for all loans, regardless of the original interest rate.
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rogerbu
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Post by rogerbu on Dec 20, 2015 12:05:34 GMT
bengilbertBen. The loan write up states 'This deal is a short dated loan...............'. Do you have an expectation of how short (in time) this loan is likely to be?
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alanp
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Post by alanp on Dec 20, 2015 12:33:40 GMT
On the Pending Loans page it says 21/03/16 as the end date.
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Post by bengilbert on Dec 20, 2015 12:46:25 GMT
bengilbertBen. The loan write up states 'This deal is a short dated loan...............'. Do you have an expectation of how short (in time) this loan is likely to be? I don't expect it to repay before the given end date, I was just drawing attention to the fact that this is only 3 months away. Apologies, I should have been clearer about this.
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