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Post by pigbreeder on Oct 30, 2018 22:20:43 GMT
Can anyone explain to me where this is going. How can the Administrator not be able to find out how part of the set up is working or even if it is. The whole thing seems a bit of a mess.
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Post by hammertime on Oct 31, 2018 10:33:31 GMT
Who knows where it is going seems a bit like the I** loans just kicking the can down the road a bit further. And no real information for investors.
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jfh82
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Post by jfh82 on Nov 12, 2018 18:15:00 GMT
Has anyone seen todays update? Looks like a total loss of capital. brilliant
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invester
P2P Blogger
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Post by invester on Nov 12, 2018 18:26:42 GMT
On reading it, it does seem like a textbook way to get a loan and not pay it back.
Probably one for the 'Hall of Fame', a total wipeout.
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jfh82
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Post by jfh82 on Nov 12, 2018 18:46:03 GMT
and all AC have to say is it 'probably' couldn't happen again...
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Post by brightspark on Nov 12, 2018 20:39:29 GMT
Sorry to read about this. Can you put a non-investor in this series of loans in the picture. From what I can glean the borrowers may have progressively borrowed more and more in successive tranches up to £2.5M at high interest rates with little real security and may have lost the lot. Is my reading of the situation correct? It really is quite worrying - the dud Scottish Castle loan, the wind turbines fiasco and now this. Really shakes confidence in p to p in general and AC in particular. Not quite Lendy but.........?
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IFISAcava
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Post by IFISAcava on Nov 12, 2018 20:41:07 GMT
Sorry to read about this. Can you put a non-investor in this series of loans in the picture. From what I can glean the borrowers may have progressively borrowed more and more in successive tranches up to £2.5M at high interest rates with little real security and may have lost the lot. Is my reading of the situation correct? It really is quite worrying - the dud Scottish Castle loan, the wind turbines fiasco and now this. Really shakes confidence in p to p in general and AC in particular. Not quite Lendy but.........? point is made that they don't lend on a company debenture anymore, only with property ass a security.
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IFISAcava
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Post by IFISAcava on Nov 12, 2018 21:09:28 GMT
Instructive to read back through this thread.
One thing that worries me is that, forgetting about the difficulties of the "sister" company on Archover, this type of loan is basically Archover's business model. And it can easily end up like this. The insurance (which was apparently in place here too) doesn't seem to be of any use.
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Post by mrclondon on Nov 12, 2018 22:44:23 GMT
Really shakes confidence in p to p in general and AC in particular. Not quite Lendy but.........? There are examples of similiar on almost every platform that has been going a few years. We are lending to sub-prime borrowers and a proportion of them will not be honest and honorable citizens. Those borrowers that had a credible sounding business plan that fails can be excused, "they tried their best". The issue is the borrowers who never had any intention of executing the business plan used to procure the loan.
What I struggle with this is how a platform can susposedly be monitoring a loan, and not spot the declared business plan is not being implemented in any shape or form. I worry that AC might be a little too eager to blame the apparantly poor recovery prospects on the nature of the balance sheet / debenture security (poor recovery of such is inevitable), and possibly be somewhat guilty of sweeping the failure of the loan monitoring under the carpet.
Is there any difference in AC not understanding what this borrower was doing with the loan funds, to FS not understanding what the Whitehaven developer was doing with their funds, or TC not understanding what some of their borrowers were doing with the funds, or MT not understanding the storage units had been disposed of as leaseholds, or L not understanding the extent of the funds needed for completion of the Wolverhampton project. These examples are all long running loans, with plenty of opportunities for the platform to follow through with the borrower.
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iren
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Post by iren on Nov 13, 2018 0:06:10 GMT
I believe you’re right that Assetz are sweeping the loan monitoring issue under the carpet. When monitoring is so entirely ineffective that after several years, it has not resulted in the nature of the business conducted being correctly identified, questions have to be asked.
I’m also not moved by “our loan criteria is different now” style arguments. Yes, and in a years time it will be different again and the operating environment will be different around it.
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kaya
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Post by kaya on Nov 13, 2018 8:59:18 GMT
Assetz might perhaps learn from their mistakes, but its us that pays for them.
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Post by brightspark on Nov 13, 2018 9:01:41 GMT
Really shakes confidence in p to p in general and AC in particular. Not quite Lendy but.........? There are examples of similiar on almost every platform that has been going a few years. We are lending to sub-prime borrowers and a proportion of them will not be honest and honorable citizens. Those borrowers that had a credible sounding business plan that fails can be excused, "they tried their best". The issue is the borrowers who never had any intention of executing the business plan used to procure the loan.
What I struggle with this is how a platform can susposedly be monitoring a loan, and not spot the declared business plan is not being implemented in any shape or form. I worry that AC might be a little too eager to blame the apparantly poor recovery prospects on the nature of the balance sheet / debenture security (poor recovery of such is inevitable), and possibly be somewhat guilty of sweeping the failure of the loan monitoring under the carpet.
Is there any difference in AC not understanding what this borrower was doing with the loan funds, to FS not understanding what the Whitehaven developer was doing with their funds, or TC not understanding what some of their borrowers were doing with the funds, or MT not understanding the storage units had been disposed of as leaseholds, or L not understanding the extent of the funds needed for completion of the Wolverhampton project. These examples are all long running loans, with plenty of opportunities for the platform to follow through with the borrower.
What makes you assume that p to p lenders' market is sub-prime? in its infancy p to p claimed to be competing with mainstream institutions. It had the competitive advantage of only willing lenders and platform managers determined to change the face of lending. Ordinary lenders want simply more than the paltry savings rates being offered by mainstream institutions with manageable risk - not dubious 11-13% loans ending all too often in disaster.
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invester
P2P Blogger
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Post by invester on Nov 13, 2018 9:34:34 GMT
Certainly I do think the documentation surrounding these loans is not sufficient.
Reading annual reports for companies, the risks are explicitly stated, graded and how the risks are mitigated is written down.
There seems to be a different agenda here that precludes these things. Perhaps none of the P2P platforms want to write the risks, because it then means the loan would have less chance of filling. But it would be useful for investors.
One of the harsh lessons I have learned is that some risks in the P2P are related, but priced up separately, meaning that the value of the loan we would get is bad.
Here, there was a risk was that the borrower would mis-use the funds. But another aspect of that would be that the security would be worth little, which are related events.
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jfh82
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Post by jfh82 on Nov 13, 2018 9:51:38 GMT
Does anyone feel AC neglected their monitoring obligations sufficiently to warrant a claim against them from investors?
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angrysaveruk
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Back and to the left..
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Post by angrysaveruk on Nov 13, 2018 10:33:58 GMT
If AC want to make large loans they need to make sure they are backed up with realistically valued "Assets" or carefully monitor the situation. This loan and the I** loans are fairly substantial in size and the recovery process is certainly something I am monitoring carefully
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