Brainer
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Post by Brainer on Oct 25, 2017 14:49:59 GMT
I suspect someone might know, though the answer to such a question would most probably involve identifying the borrower, so they won't be posting it here. Is that a hint or a guess?
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Brainer
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FundingSecure (FS) in Administration
New Loans (FS)
Oct 23, 2017 13:42:37 GMT
Post by Brainer on Oct 23, 2017 13:42:37 GMT
fundingsecure obviously have rushed this loan out without checking what they've written about it. I accept that these errors are of relatively little consequence, but making such glaring errors doesn't exactly instil confidence that FS are getting the details right when they are important. Yep, a complete mess all round. Wrong day stated, email sent after the loan had already gone live, full of grammatical errors and displaying incorrect figures. On the plus side, it does include a lovely zoomed in shot of a limescaled shower knob! Really do hope for everyone's sake FS are more diligent with the legal side of the business.
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Brainer
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Post by Brainer on Oct 17, 2017 14:58:08 GMT
stevefindlay not sure if it has been mentioned but I would like the date a loan has been repaid. Currently there is only the purchase date shown on repaid loans. Thank you. Just came on to ask for this as well.
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Brainer
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Post by Brainer on Oct 16, 2017 13:18:38 GMT
There seems little doubt the PF will soon become exhausted and may well cease to exist. The only question is which loans (and which lucky investors) will be in line to benefit. Please form an orderly queue. How do we think it will work? Will there literally be a queue if the PF becomes depleted, so that as/if it gets topped up it will just immediately pay out the next in line? Or could we end up in a situation where it depends how lucky you are with the end timing of your troubled loan? E.g.: Gloucestershire has a shortfall - depletes PF IoW has a shortfall - nothing in PF, crystallised loss for investors A period of calm, PF replenished Exeter has a shortfall - PF covers it
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Brainer
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Post by Brainer on Oct 16, 2017 12:45:21 GMT
I have seen a residual valuation for a P2P platform where the valuer had assumed financing for the development could be obtained at 7% p.a. That clearly was unreasonable because the platform was offering well more than that to its investors, so the resulting development cost estimate seemed -- to me, anyway -- likely to be low and the residual value high. That was enough to convince me to avoid that particular loan. You may have already realised this but I thought it worth pointing out as I had the same initial reaction when I first read a VR assuming 7% p.a for development financing, compared to the ~18% we assume P2P borrowers are paying. It's not quite as off as it looks at first glance if the development finance is released in tranches. I believe the valuations take 7% of the full development cost, whereas invariably it is released in tranches, so the borrower isn't paying interest on the whole lump sum for the whole period. Quick, idealised back of envelope calculation. Assume: £1,000,000 loan, 12 months, 200k advanced initially and then equally sized tranches for the next 11 months, all at 18% interest for their duration. This results in an effective development finance interest rate of 10.8% p.a. Not quite 7% but not as bad as the 18% one might initially assume.
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Brainer
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Post by Brainer on Sept 21, 2017 14:29:20 GMT
ISTM that the IMS reports simply will confirm that the money was spent. AIUI, this isn't unusual, because it isn't easy to determine how much value has been added by a given amount of money being spent. It's often presumed that after 50% of the budget is spent the value has increased from where it started 50% of the way towards the GDV. That's not a bad approximation for projects that go according to plan, but the method falls apart when things don't go according to plan, either taking longer or costing more than expected. With a fixed-price contract, that shouldn't be an issue unless the contractor fails, but it could be caused by changes requested by the developer. With this sort of situation, nobody might realise that there's a problem until all the money is spent and the project remains unfinished. Might that be what happened here? There's a loan on AC (#392) that has MS reports with each drawdown. I've not read many MS reports to know whether these are particularly good but the level of detail in them would make a situation like what has happened here nigh on impossible. Everything has been budgeted, tracked, projected, photographed and verified throughout the development. It even has a 'Cash Flow Graph' which appears to somewhat answer a question I believe you have asked elsewhere on the forum about expenditure vs progress/value for a development project - apparently there is a "standard 'S' curve". I'm aware #392 is a smaller, less specialised development and so probably easier to monitor but even still, the IMS Lendy has used (or how Lendy has used the info provided) needs a serious autopsy.
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Brainer
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Post by Brainer on Sept 11, 2017 12:57:52 GMT
As someone stuck in both DFL001 and 002, thanks seeingred for your continued updates. Looking at the Rightmove listings, guide prices for DFL002 apartments are around the valuation figures, and so is the reported ongoing sale of (one of) the commercial unit(s). So that may yet have a happy ending, if these prices can be achieved and things speed up a bit. Guide price on RM for the DFL001 house is quite a bit below the original valuation but a quick look at the comparables suggests a higher price could be achieved (if the whole development was completed properly). I guess the borrower is just trying to knock the sale-ready house out cheap to help finance the completion of the rest. Slightly more optimistic that this won't be a disaster if Lendy can come to some sort of arrangement to get the thing finished.
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Brainer
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Post by Brainer on Sept 7, 2017 12:30:11 GMT
Likewise. Made even more irritating having had a reasonable sum invested in the various previous tranches.
I understand FS have said they like to keep no restrictions on some loans to keep the BHs happy, which from a business point of view makes some sense. My question to them would be: do these BHs that mop up the low LTV loans in seconds also invest large sums in other loans, the ones that struggle to fill? Because if not, their reasoning is invalid - the loans these BHs mop up would fill quickly with a sensible bid limit anyway, and the other less desirable loans on the platform are no better off for having the BHs around. In which case, all the lack of bid restriction is actually doing is irritating lots of smaller investors.
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Brainer
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Post by Brainer on Aug 19, 2017 11:40:52 GMT
From the loan overview:
With regards to the build costs - we are providing 100% of these to the borrower. We will release these costs to the borrower in a tranched format (£500k at a time), following receipt of a report from the QS to confirm that the borrower has complied with his construction obligations. i.e he has spent £500k on the build, the value has increased by £x and we can lend him another tranche of £500k minus fees and interest for 12 months. In this way, we can control the overall amount we have at risk based on the status of the build programme.
Stellar job. This and other bits in the case could be interpreted as misrepresentation which is subject to a lawsuit against Lendy, hypothetically speaking. Same thought crossed my mind. Lendy clearly haven't done what they said they would. And the situation isn't entirely dissimilar to Whitehaven on FS if it can be shown Lendy were pumping out extra tranches based on work that hadn't been completed. Certainly a whole load of incompetence/negligence at work here, but without further detail it's hard to say whether the blame lays mostly with Lendy, the borrower or the QS - although they all seem at least somewhat culpable.
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Brainer
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Post by Brainer on Aug 18, 2017 17:24:54 GMT
From the loan overview:
With regards to the build costs - we are providing 100% of these to the borrower. We will release these costs to the borrower in a tranched format (£500k at a time), following receipt of a report from the QS to confirm that the borrower has complied with his construction obligations. i.e he has spent £500k on the build, the value has increased by £x and we can lend him another tranche of £500k minus fees and interest for 12 months. In this way, we can control the overall amount we have at risk based on the status of the build programme.
Stellar job.
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Brainer
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Post by Brainer on Aug 12, 2017 17:30:56 GMT
Well it's now a month rather than a week. Any news? Update on 3rd August contains a link to the "executive summary".
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Brainer
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Post by Brainer on Aug 10, 2017 13:35:57 GMT
Looking at the size of these flats versus comparables, does the estimated value looks a little high to anyone else? Total size of the block is 1209 sq m, comparables are between £1,600-£2,000 sq m, so simple maths says at best the GDV is 2000*1209 = 2,418k, not 2,700k. Or is sq metreage not that important? Or does being brand new add value?
E.g. a 1 bedroom apartment in the same development (built in 2007) with 48 sq m was sold for £78,500 in Nov '16. The 1 bed apartments in this block are only 41-42 sq m and estimated at £95,000.
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Brainer
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Post by Brainer on Jul 21, 2017 19:25:20 GMT
Arent we nice to give a s**t about the blocked SM, we are going to throw said s**t at a wall to see if it sticks, if it doesnt we'll try a different type of s**t until it does. In the words of a rapper you won't have heard of: Throw enough s**t at the wall and some of it will stick But make no mistake, your wall's still covered in s**t
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Brainer
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Assetz Capital (AC)
Loan 331
Jun 8, 2017 14:05:51 GMT
sqh likes this
Post by Brainer on Jun 8, 2017 14:05:51 GMT
My GBBA sold out a few chunks of this, presumably it will have done the same for others and that'll be where the 1M came from. At a guess, I would say it will now be a large part of the new PSIA account.
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Brainer
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Post by Brainer on Jun 6, 2017 18:23:49 GMT
My decision awaits yours then.
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