seeingred
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Post by seeingred on Oct 28, 2016 10:59:29 GMT
Yes, true enough about soft drinks but a wealth of advice is freely available and people should know what high sugar drinks do to their teeth. As with smoking, we were told nearly 50 years ago and are free to accept or reject the medical and scientific advice.
In respect of P2P loans, to a large extent lenders must have trust in the platform under which their money is being lent. If updates "cannot be trusted" or as charliebrown puts it "not take them at face value" where does that leave SS credibility?
I have been sent details of DP and his 60 or so companies (many/most dissolved?) and I replied to the member who sent me the information in the following terms:
Thank you for those few kind words. Not with a disinfected 10 foot barge pole would I have touched loans related to people like this - had I known.
The real point here is (as I have recently posted on the 020 thread) is that valuations should properly have due regard to the borrower history. If a building or site development or other asset is far more likely to have to be sold at a fire-sale or similar valuation, then this should be reflected in the initial LTV valuation.
Fortunately I can afford to lose money (which is a necessary condition before anyone lends on any P2P platform) but that seems no good reason not to question the depth, validity or completeness (or otherwise) of information that P2P platforms provide. If (as they do) they encourage investments via glowing comments about borrowers, then they should also come clean about the decidedly dodgy (DD) history of other borrowers - then we can all make an informed decision.
The only other option is to assume that all loans offered by SS which do not have glowing recommendations as to the history and/or standing of borrowers do not include such statements for a very good reason. Maybe that is the case already and people need to be far more suspicious.
To a large extent P2P platforms rely on their lenders and the confidence that the platform inspires. There are after all, many alternative and competing platforms - and a simple calculation can show that even a small capital loss on a dodgy project can more than wipe out years of interest on good projects.
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seeingred
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Post by seeingred on Oct 28, 2016 10:20:22 GMT
Followup to the request from Orca Money - and to follow up the question from charliebrown over valuations.
My major concern here is also the valuations - and in respect of loan PBL056 also. In a thread centred on PBL 056 I made the following comments: these relate to valuations and also the information about the borrowers that is surely relevant and should be disclosed to some degree. P2P platforms rely on trust - investors must trust the information they are given since most of them do not have the time or resources or skill set to investigate every nook and cranny of Companies House (etc) in respect of every loan.
"Leaving aside for the moment what investors and potential investors were or were not told and when, and what they arguably should have been told, (see previous posts)no-one seems to have questioned the validity of the valuation - which was for £650k in August 2015. Now the site is for sale at £450k (and open to offers??). Lendy might well be funding the interest on the loan for 2 to 3 months (so it looked a reasonable short term investment at a time when the SM was very thin) but if these interest payments are ultimately to be taken from capital - and if the NET sales proceeds are significantly below the £450k figure (as they seem certain to be), where does that leave SS investors?
How can we rely on valuations if these are so far off the mark? Are they worth the paper they are written on? Granted values can change, key personnel may die and a business or building project can lose its way - these are risks investors must accept - but I would question £650k down to £450k or less within a year or so unless maybe all farmland has been similarly affected? It does not give confidence in other farm valuations?
The other general point is that if a borrower has a string of failed companies behind him, then we might be told. In other loan details we are told that (I paraphrase here) the borrower is 'a wealthy man, an highly experienced and successful property developer, a building surveyor with a 27 year history of developing similar sites', etc etc - so as to give prospective investors some extra degree of reassurance. If these 'positive' comments about borrowers are considered relevant to be included by SS in their information to lenders, maybe it could be argued that 'highly negative' characteristics of borrowers should be included by SS also - as an equally valid point of additional information upon which an investment decision could be based?"
The key point here is that if a borrower is decidedly dodgy, then the valuation should be based more on what the property or asset could be sold for in a very short time as a distressed sale, given that this is far more likely than for a borrower who has a proven and good track record.
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seeingred
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Post by seeingred on Oct 25, 2016 13:31:43 GMT
To answer the point by Oldgrumpy on this thread, yes I did buy into 064 but thankfully only in a small way (low thousands) so not much to worry about. I stopped buying on 10 October. At that time the loan was one of the few on the SM, everything looked OK on the updates, the neighbourhood is OK, and I was aiming to build a portfolio on SS of maybe 100k within a few months. How times change.
In buying into 064 I maybe did what many 'new' investors do - experiment with the site a little yet rely far too much on SS and their updates. I have considerable property holdings via FC and am well aware of the possible problems in all property markets including the possibility of a major systemic downturn - but 650k down to 450k indicates to me that 650 was never realistic. Did the valuers properly investigate the sale history of the land? Much lower figures have been indicated.
Some of the criticism of FC elsewhere is not warranted: if property loans extend for a few months and if interest continues to be paid then I'm happy. That is the nature often of building projects and leases - they can over-run and investors need to be aware of this. But I am not happy about what I regard as highly relevant information being either withheld or delivered only after months of delay.
ALL of this (056 etc) has the bad smell of deals that should maybe never have been offered to investors except perhaps with a warning relating to the history of some of the people involved. I have no idea who DP is.. But it is surely the job of SS - if they wish to continue to be trusted - to tell us not only the good points about borrowers but also the less good points. I'm sure they'd never lend to anyone who had bad points.
I note that people are still buying 064 - including 5000 4 days ago and 500 yesterday. Presumably they read the SS updates to the effect that all remains rosy in the pigsty.
I refer to my previous post here:
"if a borrower has a string of failed companies behind him, then we might be told. In other loan details we are told that (I paraphrase here) the borrower is 'a wealthy man, an highly experienced and successful property developer, a building surveyor with a 27 year history of developing similar sites', etc etc - so as to give prospective investors some extra degree of reassurance. If these 'positive' comments about borrowers are considered relevant to be included by SS in their information to lenders, maybe it could be argued that 'highly negative' characteristics of borrowers should be included by SS also - as an equally valid point of additional information upon which an investment decision could be based?"
The idea of a facebook page or similar, with existing investors invited to join, and outside of the control of the mods, might be one way of retaining the (in)valuable contributions from CD.
This is the information age - if CD is prepared to root around and is further prepared very kindly to make various truffles available for our collective delight, then as far as I am concerned he is to be congratulated. In this instance he is shining a light into dark corners that many of us would not know how to access.
On the point that "the borrower doesn't matter so long as the security is good" - that rather depends also on the valuations being sound.
In these and similar cases where borrowers are known (or should have been known?) to be so reputable, maybe the valuations used should be based more around what could quickly be realised if Inspector Knacker of the Yard came to call.
May we live in interesting times......
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seeingred
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Post by seeingred on Oct 25, 2016 9:51:36 GMT
As a new investor in this platform (but not to P2P) I bought into 056 in a small way. This was after the chickens were known to be coming home to roost - or maybe it was pigs flying past the full moon. There was nothing on the SS site to indicate a particular problem, no big red box for example. I only later found this forum and including the valuable insights and contributions from CD.
Leaving aside for the moment what investors and potential investors were or were not told and when, and what they arguably should have been told, (see previous posts) no-one seems to have questioned the validity of the valuation - which was for £650k in August 2015. Now the site is for sale at £450k (and open to offers??). Lendy might well be funding the interest on the loan for 2 to 3 months (so it looked a reasonable short term investment at a time when the SM was very thin) but if these interest payments are ultimately to be taken from capital - and if the NET sales proceeds are significantly below the £450k figure (as they seem certain to be), where does that leave SS investors?
How can we rely on valuations if these are so far off the mark? Are they worth the paper they are written on? Granted values can change, key personnel may die and a business or building project can lose its way - these are risks investors must accept - but I would question £650k down to £450k or less within a year or so unless maybe all farmland has been similarly affected? It does not give confidence in other farm valuations?
The other general point is that if a borrower has a string of failed companies behind him, then we might be told. In other loan details we are told that (I paraphrase here) the borrower is 'a wealthy man, an highly experienced and successful property developer, a building surveyor with a 27 year history of developing similar sites', etc etc - so as to give prospective investors some extra degree of reassurance. If these 'positive' comments about borrowers are considered relevant to be included by SS in their information to lenders, maybe it could be argued that 'highly negative' characteristics of borrowers should be included by SS also - as an equally valid point of additional information upon which an investment decision could be based?
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seeingred
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Post by seeingred on Oct 22, 2016 10:24:59 GMT
Why no recent updates??
You could ask that question about quite a few loans.
At least this one is still positive 66 days.
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seeingred
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Post by seeingred on Oct 21, 2016 15:21:11 GMT
Another (major) P2P platform has just reduced its target rates, the highest they aim for is now 6.3%, in an account with no 'provision' fund. And if you want easy access it's down at 3.1%.
In a few weeks/months 12% may seem like a dream come true.
Lots of sellers, but equally buyers so fluctuating between 70,000 and 80,000 for sale.
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seeingred
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Post by seeingred on Oct 21, 2016 14:02:32 GMT
66,000 put up for sale on SM within minutes of the email, currently down to 65,000 and with a few buyers!
Underlying value:
This loan has a value of £500,000 and represents 1 of a total of 5 tranches, for a three-year term secured by a first charge against **** ******* **** , **** **** ******* *******, valued at £4,850,000.
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seeingred
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Post by seeingred on Oct 21, 2016 13:32:48 GMT
The purchase price of 8.8 was before planning??
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seeingred
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Post by seeingred on Oct 21, 2016 12:07:06 GMT
Many very able people can be classed as useful nuisances (useful to many people, nuisances to a few others).
Investigative journalists are one example (think Panama Papers). Dozens have been killed because they chose to pursue the truth. The same is true of environmental activists.
Harsh action against people who are ultimately useful is difficult to support.
The DD provided by CD has been helpful. I hope it can continue in some form, either here or elsewhere.
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seeingred
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Post by seeingred on Oct 21, 2016 11:40:50 GMT
It seems unhelpful to say the least to have the latest update as 'talking to us, well able to pay, discussions progressing well, repayment expected shortly' etc and all weeks out of date when the true position is known within SS to be quite different.
PBL069 is another example. From the SS updates all would look OK on that one too. Yet it is 40 days overdue. A meaningful update could have been provided weeks ago.
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seeingred
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Post by seeingred on Oct 18, 2016 13:15:02 GMT
Small organisations who lend money (and small builders who want to borrow it) are always at risk of a key person or two falling under a bus.
Loans related to football clubs might experience a loss of 'confidence' if just one key person somehow departed.
What contingency plans are in place for SS? Or for MT for that matter?
FC and Z certainly have plans and are large enough that loss of one or two key people would not matter so much.
If any small platform begins to have a feel of no-confidence about it, it is last one out turn off the lights?
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seeingred
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Post by seeingred on Oct 18, 2016 10:12:31 GMT
I asked about PBL069 a few days ago: it's been some time since an update.
"We are working closely with the Borrower on this in light of their recent bankruptcy order, and supervising them heavily. The properties being sold to achieve repayment of the loan and we have been informed that the anticipated completion date is soon. Completion is subject to completion of due diligence being undertaken so completion may not happen for a while and this is largely out of our hands. We will keep you updated. "
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seeingred
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Post by seeingred on Oct 18, 2016 9:50:19 GMT
On the topic of prefunding, there are two aspects of several P2P sites that are unfair to many (perhaps most) investors (although maybe not to people who can spend all their times on discussion forums).
Few people have access to superfast broadband and/or bots that can snap up loans at half a second (or less) past when bidding opens, and some people have to work. They cannot be at their computers at 4pm. In fairness to all, any system that produces a more even spread of investment opportunity might be welcomed by the majority.
The other generic question is that lenders are rushing in increasing numbers to these 'high gain' platforms (MT, SS for example) but the number of quality borrowers is not keeping pace. hence the scrabble for loans when they are made available.
The solution seems obvious - get more business in by reducing rates charged to borrowers and offered to lenders. This would be unfair only to the few computer-savvy people who write bots and have access to superfast broadband at all times of the day, and who are able now to dominate the whole process.
When loans don't fill in the first 24 hours, offer a second tranche again limited to £X per lender.
Then open it to all at unlimited amounts
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seeingred
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Post by seeingred on Oct 17, 2016 16:35:35 GMT
I am sure it would never happen for original planning to be allowed to lapse in the (uncertain) knowledge that a larger or quite different development might be approved under current conditions.
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seeingred
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MoneyThing (MT) in Administration
Finance ISA
Oct 14, 2016 10:45:54 GMT
Post by seeingred on Oct 14, 2016 10:45:54 GMT
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