tonyr
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Post by tonyr on Oct 14, 2017 6:55:01 GMT
We'll find out the result shortly, and we'll also find out what the voter turnout was. Will it be more than 20%? Low voter turnout works for me - it means that my stake counts for more. The amount owing is only about 12% of the contracted repayments at the start and something like 10% of the assets that we hold security over. There has to be a way to get this last bit back to us and release the assets so conclude this loan.
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tonyr
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Post by tonyr on Oct 16, 2017 9:10:29 GMT
if the borrower comes up with a semi-serious proposal then AC are obliged to put it to a lender vote. This leads to a clear method of exploitation, just keep making slightly better offers until the vote just passes. Whilst this is best fro the borrower, it's not best for the AC community and can lead to divisions (e.g. the 52/48 Brexit vote).
So, if enough lenders agree, can we put a proposal forward for AC to put to the borrower? As they've already swapped interest for capital repayments, my suggestion is that we swap them back. That is convert all the interest back into a capital repayment, give it some reasonable terms (I don't mind if it's 0% and 2 years) and continue the loan until it fully repays. The repayments would be what they have previously considered as reasonable, so shouldn't be onerous and at (say) 0% interest be a better deal than they can get elsewhere. There would be nothing stopping them from selling up or otherwise repaying early to release the charge on the property.
What do people think? Assuming the vote is B today, it is worth coming up with a consensus on what the forum members here would accept and asking AC to put it forward?
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niceguy37
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Post by niceguy37 on Oct 16, 2017 10:00:15 GMT
As I see it the borrower needs to look at how much money is needed to pay off our loan, to fix up anything that is needed at the hotel, recruit extra staff if required, and create a pool of working capital, and then decide if there is a good business case from continuing to run the hotel with this level of debt, or whether they should sell the hotel and do something else.
Obviously it was a struggle with the previous loan at an initial 14%, but a much smaller loan at a lower rate would be much more serviceable. Or the hotel could be sold for, hopefully, something near the stated asset value, leaving the borrower a long way from the bread-line.
We shouldn't be seen as a soft touch just because we are P2P and some of us are trying to use our money to help make the world a better place.
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trouble
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Post by trouble on Oct 16, 2017 12:26:42 GMT
if the borrower comes up with a semi-serious proposal then AC are obliged to put it to a lender vote. This leads to a clear method of exploitation, just keep making slightly better offers until the vote just passes. Whilst this is best fro the borrower, it's not best for the AC community and can lead to divisions (e.g. the 52/48 Brexit vote). So, if enough lenders agree, can we put a proposal forward for AC to put to the borrower? As they've already swapped interest for capital repayments, my suggestion is that we swap them back. That is convert all the interest back into a capital repayment, give it some reasonable terms (I don't mind if it's 0% and 2 years) and continue the loan until it fully repays. The repayments would be what they have previously considered as reasonable, so shouldn't be onerous and at (say) 0% interest be a better deal than they can get elsewhere. There would be nothing stopping them from selling up or otherwise repaying early to release the charge on the property. What do people think? Assuming the vote is B today, it is worth coming up with a consensus on what the forum members here would accept and asking AC to put it forward? The more i think about this one the more insulting the offer is, AC do have the ability to kick back and say ''sorry, but that isn't an acceptable first offer''. This will be interesting how this plays out.
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kermie
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Post by kermie on Oct 16, 2017 20:59:57 GMT
We shouldn't be seen as a soft touch just because we are P2P and some of us are trying to use our money to help make the world a better place. Too right; P2P is the ludicrously risky end of lending - to cover our losses on loans that have gone genuinely bad (not this one - still plenty of security - why are we even talking about making a charitable donation to the borrower?!), we need to make our profits where we can on the riskier loans that pay off (and at 14%, this loan was one of them!) Lenders were very lenient some months ago to reduce the interest rate and defer interest repayments. The quid-pro-quo is that the borrower now pays up - a small loan (even with AC - I'd not be averse to lending again) to refinance the remaining interest does not seem like it would be too much of a hardship.
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Post by Butch Cassidy on Oct 17, 2017 10:09:36 GMT
We shouldn't be seen as a soft touch just because we are P2P and some of us are trying to use our money to help make the world a better place. Too right; P2P is the ludicrously risky end of lending - to cover our losses on loans that have gone genuinely bad (not this one - still plenty of security - why are we even talking about making a charitable donation to the borrower?!), we need to make our profits where we can on the riskier loans that pay off (and at 14%, this loan was one of them!) Lenders were very lenient some months ago to reduce the interest rate and defer interest repayments. The quid-pro-quo is that the borrower now pays up - a small loan (even with AC - I'd not be averse to lending again) to refinance the remaining interest does not seem like it would be too much of a hardship.Taking £80k against the existing £400k+? asset charge with AC now would attract a very low rate (<5 - 6%) in current conditions & would not seem unreasonable. Personally I would be happy with anything upwards of 75% of what is owed to achieve full & final settlement but can completely understand those who feel that the flexibility & support shown by lenders over the troubled history of this loan deserves full settlement. My only reservation is the inflexibility & lack of dynamic & creative thought that dictates AC's role in this process; they have a track record of demonstrating a "tin ear" to lenders concerns & are notoriously slow in doing anything, even counting the votes, so I fully expect this to drag on for several months more with negligible progress. I would prefer a simple lender vote on a counter response (say <60%, 60-80%, 80%+, nothing less than 100%) that would give AC a firm, democratic lender mandate to negotiate a better deal & put it to a final lender vote in a relatively short timescale - yes I might be a dreamer but it just seems common sense to get a solid, lender backed mandate to speed things up so a final agreement can be reached but I don't expect it to happen anytime soon  .
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trouble
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Post by trouble on Oct 17, 2017 10:22:29 GMT
Too right; P2P is the ludicrously risky end of lending - to cover our losses on loans that have gone genuinely bad (not this one - still plenty of security - why are we even talking about making a charitable donation to the borrower?!), we need to make our profits where we can on the riskier loans that pay off (and at 14%, this loan was one of them!) Lenders were very lenient some months ago to reduce the interest rate and defer interest repayments. The quid-pro-quo is that the borrower now pays up - a small loan (even with AC - I'd not be averse to lending again) to refinance the remaining interest does not seem like it would be too much of a hardship.Taking £80k against the existing £400k+? asset charge with AC now would attract a very low rate (<5 - 6%) in current conditions & would not seem unreasonable. Personally I would be happy with anything upwards of 75% of what is owed to achieve full & final settlement but can completely understand those who feel that the flexibility & support shown by lenders over the troubled history of this loan deserves full settlement. My only reservation is the inflexibility & lack of dynamic & creative thought that dictates AC's role in this process; they have a track record of demonstrating a "tin ear" to lenders concerns & are notoriously slow in doing anything, even counting the votes, so I fully expect this to drag on for several months more with negligible progress. I would prefer a simple lender vote on a counter response (say <60%, 60-80%, 80%+, nothing less than 100%) that would give AC a firm, democratic lender mandate to negotiate a better deal & put it to a final lender vote in a relatively short timescale - yes I might be a dreamer but it just seems common sense to get a solid, lender backed mandate to speed things up so a final agreement can be reached but I don't expect it to happen anytime soon . That seems an ideal solution Butch
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angrysaveruk
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Post by angrysaveruk on Oct 17, 2017 13:12:43 GMT
What loan number is this?
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niceguy37
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Post by niceguy37 on Oct 17, 2017 14:04:58 GMT
Too right; P2P is the ludicrously risky end of lending - to cover our losses on loans that have gone genuinely bad (not this one - still plenty of security - why are we even talking about making a charitable donation to the borrower?!), we need to make our profits where we can on the riskier loans that pay off (and at 14%, this loan was one of them!) Lenders were very lenient some months ago to reduce the interest rate and defer interest repayments. The quid-pro-quo is that the borrower now pays up - a small loan (even with AC - I'd not be averse to lending again) to refinance the remaining interest does not seem like it would be too much of a hardship.Taking £80k against the existing £400k+? asset charge with AC now would attract a very low rate (<5 - 6%) in current conditions & would not seem unreasonable. Personally I would be happy with anything upwards of 75% of what is owed to achieve full & final settlement but can completely understand those who feel that the flexibility & support shown by lenders over the troubled history of this loan deserves full settlement. My only reservation is the inflexibility & lack of dynamic & creative thought that dictates AC's role in this process; they have a track record of demonstrating a "tin ear" to lenders concerns & are notoriously slow in doing anything, even counting the votes, so I fully expect this to drag on for several months more with negligible progress. I would prefer a simple lender vote on a counter response (say <60%, 60-80%, 80%+, nothing less than 100%) that would give AC a firm, democratic lender mandate to negotiate a better deal & put it to a final lender vote in a relatively short timescale - yes I might be a dreamer but it just seems common sense to get a solid, lender backed mandate to speed things up so a final agreement can be reached but I don't expect it to happen anytime soon . IMHO the lenders have been very reasonable in lowering the rate and allowing capital to be repaid first, further lowering our effective interest rate. I'm sorry the lender has suffered a personal tragedy, but this is a business. As Butch Cassidy has stated it should be very easy to borrow the remaining funds, and this should have a negligible effect on whether the surviving borrower can continue in business or not. We have enough losses in P2P through unrecoverable issues. If we write off loans every time a borrower has bad luck we'll be lucky to break even.
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david42
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Post by david42 on Oct 18, 2017 17:59:14 GMT
What loan number is this? It is loan number 79
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btc
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Post by btc on Oct 19, 2017 9:32:11 GMT
Which part of Option B don't you understand?
"- Asking lenders to vote on a number of potential interest discount alternatives."
We already said no to this. Is there no value in the assets?
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gibmike
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What is a cynic? A man who knows the price of everything and the value of nothing.
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Post by gibmike on Oct 19, 2017 10:01:04 GMT
btc i ithought we voted on the offer not the 10% not whether we should accept any offer. My opinion is that they will come back witha higher offer which, if rejected we should expect either another loan or full repayment via sale of the asset.
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trouble
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Post by trouble on Oct 19, 2017 12:20:06 GMT
It will be interesting to see how AC phrase the next vote in terms of trying to get us to vote for what AC would like (which would appear to be a discount) and what we want given there are plenty of assets, and as has already been said, we have enough losses elsewhere not to give up what is due (yes the interest is all due to us), especially where the borrower has the wherewithal to pay us.
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mikes1531
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Post by mikes1531 on Oct 20, 2017 2:23:14 GMT
if the borrower comes up with a semi-serious proposal then AC are obliged to put it to a lender vote. This leads to a clear method of exploitation, just keep making slightly better offers until the vote just passes. I'm not sure that a 20p/£ settlement should be considered a serious proposal. And if the strategy suggested above wasn't already obvious to the borrower, AC seem to be encouraging them to try it! Which part of Option B don't you understand? "- Asking lenders to vote on a number of potential interest discount alternatives." We already said no to this. Is there no value in the assets? I really was upset by this suggestion from AC.  On other loans in recovery situations, AC make a point of not putting their negotiating position where the borrowers could see it, yet here they seem to be making suggestions to the borrower regarding how they could cut AC investors out of the interest they've accrued. And that, as already has been pointed out, is reduced from what the borrower agreed to pay in the first place. Conspicuous by its absence from the list of possibilities suggested by AC was a settlement in full! It's particularly absent considering how emphatic the vote result was. It's not likely to happen, but what I'd really like to see is a slightly improved offer that's turned down even more emphatically by investors. Without that, all we'll see is a string of slightly improved offers until one reaches the 50% approval level. And if it isn't already obvious, since the capital of this loan has officially been repaid, no further interest is accruing, so it is costing the borrower absolutely nothing at all to take their time before making another settlement proposal. While this might wear down some investors, the longer this carries on, the less sympathetic I feel toward the borrower and the more I'm inclined to call in receivers to obtain all that we're owed.
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niceguy37
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Post by niceguy37 on Oct 20, 2017 9:36:00 GMT
I would like to see a 60 or 90-day deadline imposed for repayment on this loan.
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