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Post by sannytwist on Jan 10, 2017 15:06:09 GMT
What is the general consensus on this loan... mite drop a few £££ on this one. Seems fine to me
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markdirac
Member of DD Central
Posts: 128 
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Post by markdirac on Jan 10, 2017 15:28:44 GMT
pro con
- The valuation is one local estate agent's advice as to what price to put the house on the market. It may be wrong, it may be right.
- We have no idea of the scale of the works...
- ...and so we have no idea by how much the £170k value will be reduced once the refurbishment is underway
- ... and we don't know what is the chance of the refurbishment completing successfully and a sale in 6 months
- How will our loan be repaid if a sale is not achieved in 6 months?
- We have no idea of the capability of the borrower to complete this project successfully. (I am thinking Grand Designs successes and failures.)
- We do not know if the borrower is paying monthly interest to the 1st charge holder, or if she will need to find interest as well as capital after 6 mths
If everything goes badly and the project does not complete: - say the current value today is only realistically £150k
- say the value is reduced by £30k at the refurbishment's point of no return
- say there is £10k of interest to find
This would leave £14k for the 1st charge holder and FS to prosecute recovery of security.
I reckon this would be a worst-case situation.
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Post by sannytwist on Jan 10, 2017 15:37:45 GMT
pro con
- The valuation is one local estate agent's advice as to what price to put the house on the market. It may be wrong, it may be right.
- We have no idea of the scale of the works...
- ...and so we have no idea by how much the £170k value will be reduced once the refurbishment is underway
- ... and we don't know what is the chance of the refurbishment completing successfully and a sale in 6 months
- How will our loan be repaid if a sale is not achieved in 6 months?
- We have no idea of the capability of the borrower to complete this project successfully. (I am thinking Grand Designs successes and failures.)
- We do not know if the borrower is paying monthly interest to the 1st charge holder, or if she will need to find interest as well as capital after 6 mths
If everything goes badly and the project does not complete: - say the current value today is only realistically £150k
- say the value is reduced by £30k at the refurbishment's point of no return
- say there is £10k of interest to find
This would leave £14k for the 1st charge holder and FS to prosecute recovery of security.
I reckon this would be a worst-case situation.
Very detailed  , l got so much to learn !
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Post by sannytwist on Jan 10, 2017 16:00:34 GMT
The loan is filling up so quickly was 45% last time l looked , now already 86%
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phil
Posts: 190
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Post by phil on Jan 10, 2017 16:23:45 GMT
What is the general consensus on this loan... mite drop a few £££ on this one. Seems fine to me Flat 4, a similar 2 bedroomed flat in the same property sold for £197,000 in July last year, seems a reasonable investment to me.
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ashtondav
Member of DD Central
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Post by ashtondav on Jul 14, 2017 18:11:58 GMT
And the amount borrowed is going to be £24,000, for a 2 bed apartment in penarth, Cardiff? I'm only guessing but gold taps and marble floors, perhaps?
what could it be, about 100sqm. That's £240 per sqm! For flooring and decorating.
I think he's rewarding himself with a world cruise.
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mikes1531
Member of DD Central
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Post by mikes1531 on Jul 14, 2017 19:09:47 GMT
And the amount borrowed is going to be £24,000, for a 2 bed apartment in penarth, Cardiff? I'm only guessing but gold taps and marble floors, perhaps? what could it be, about 100sqm. That's £240 per sqm! For flooring and decorating. I think he's rewarding himself with a world cruise. : Might it have escaped your notice that this is a renewal? The £24k was borrowed back in January before any of the refurbishment work started. No new money is being borrowed now, so presumably the borrower is using their own resources (or an unspent bit of the initial FS loan) to finish the project.
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ashtondav
Member of DD Central
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Post by ashtondav on Jul 14, 2017 20:08:03 GMT
It did escape my notice.
I can't afford any more dodgy FS loans so sadly, I'm out ( despite a good LTV).
An honest assessment of what the loan is actually for should not be guesswork.
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Post by angrykittens on Jul 14, 2017 20:14:18 GMT
My primary concern is Due Diligence of what the asset is actually worth and therefor the likelihood of full recovery if the loan defaults. What the borrower uses the money for is kind of irrelevant, because whatever they tell FS they are using it for, doesn't equate to what they might actually do with it.
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rs
Member of DD Central
Posts: 467
Likes: 254
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Post by rs on Jul 14, 2017 20:34:19 GMT
My primary concern is Due Diligence of what the asset is actually worth and therefor the likelihood of full recovery if the loan defaults. What the borrower uses the money for is kind of irrelevant, because whatever they tell FS they are using it for, doesn't equate to what they might actually do with it. strange that photos can't be provided of the flat for lenders. Maybe the borrower is trying to hide something! Definitely not touching this loan after bad experience with FS.
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Godanubis
Member of DD Central
Anubis is known as the god of death and is the oldest and most popular of ancient Egyptian deities.
Posts: 2,011
Likes: 1,013
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Post by Godanubis on Jul 14, 2017 21:14:09 GMT
My primary concern is Due Diligence of what the asset is actually worth and therefor the likelihood of full recovery if the loan defaults. What the borrower uses the money for is kind of irrelevant, because whatever they tell FS they are using it for, doesn't equate to what they might actually do with it. strange that photos can't be provided of the flat for lenders. Maybe the borrower is trying to hide something! Definitely not touching this loan after bad experience with FS. What Bad experience ??
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mikes1531
Member of DD Central
Posts: 6,452
Likes: 2,320
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Post by mikes1531 on Jul 14, 2017 21:44:11 GMT
strange that photos can't be provided of the flat for lenders. Maybe the borrower is trying to hide something! Definitely not touching this loan after bad experience with FS. What Bad experience ?? : The classic example is Whitehaven, where FS advanced further tranches of a development loan to the borrower seemingly by taking the borrower's word that work was progressing rather than asking for photographic evidence or requesting an independent assessment. Forum users then discovered -- when one of us visited the property -- that it didn't appear as if any work actually had been done. (See that loan's thread for more info.)
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rs
Member of DD Central
Posts: 467
Likes: 254
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Post by rs on Jul 15, 2017 9:10:20 GMT
Godanubis: The classic example is Whitehaven, where FS advanced further tranches of a development loan to the borrower seemingly by taking the borrower's word that work was progressing rather than asking for photographic evidence or requesting an independent assessment. Forum users then discovered -- when one of us visited the property -- that it didn't appear as if any work actually had been done. (See that loan's thread for more info.) i had a look at this loan and there are photos but the loan has been going on for a year and I think this loan will be sold out very quickly due to low ltv.
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mikes1531
Member of DD Central
Posts: 6,452
Likes: 2,320
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Post by mikes1531 on Jul 15, 2017 14:48:13 GMT
i had a look at this loan and there are photos but the loan has been going on for a year and I think this loan will be sold out very quickly due to low ltv. In looking at the loan info, it struck me that with most of the refurbishment already complete the LTV actually ought to be even lower than what FS are showing. If the value has increased to at least £190k by now then the LTV would be less than 50%. I suppose the LTV and the small size of the loan are what made FS decide to put an investing limit of £500 on this loan. That was enough to keep it available on the website for a few minutes. That was a lot longer than the other loan renewal that FS released this morning -- it was funded fully in a matter of seconds.
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Post by mrclondon on Mar 8, 2019 11:47:13 GMT
The 2nd (?) renewal has repaid in full today with all 415 days interest.
The fascinating thing is this has occured roughly a week after LPA receivers were appointed, long before any action they might have taken would have bourne fruit.
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, l got so much to learn !
