copacetic
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Post by copacetic on Oct 17, 2017 11:15:59 GMT
Personally I don't find the crime the father was convicted of to be that morally objectionable and the 'crime' NP was convicted of seems to be accepting money from a parent age 20 without questioning where it came from. He seems to be be motivated and has a good list of completed developments under his belt at such a young age.
My concern is more regarding the valuation of the completed development. The £75-100k apartments look expensive for the student market but I'd have thought if they were finished nicely they'd be attractive to young professionals. There's apartments not far from here Forster place which gives an idea of rental potential except this is a much nicer looking building.
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hazellend
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Post by hazellend on Oct 17, 2017 11:16:22 GMT
Personal statement confirms what I said, which seemed obvious to me. The facts may well have been obvious to you, but his attitude to the facts was not! That is the real value of the statement. He's hardly going to say "I have no regrets and wish I had gotten away with the money scot free" even if that was what his attitude was.
My point is, you need to make a judgement call. I don't think there is anything in the letter that wasn't factually obvious from the initial DD.
Of course, I'm quite an aggressive investor and would even lend to a former bankrupt if the security was good
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seeingred
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Post by seeingred on Oct 17, 2017 11:17:15 GMT
I had already made my mind up to go with the borrower. People can be shaped by and driven by circumstances, or fate.
The question that is now central is what is this pile of semi-derelict ornate stonework actually worth in its present state?
The Land registry seems to state £1 million (price paid in late 2016). The valuation is £2 million (and we know all about accurate RICS valuations do we not?). Yet we are told £2 million was actually paid?
This building has been empty, unloved and unused for decades. In any recession it could revert back to being a pile of stone despite any PP in place for development. The initial loan is for £750,000. Question is, would it actually worth that if a recession put an end to any proposed development? Any investment is a risk (that's what we are here for) but what exactly are the starting parameters?
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dovap
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Post by dovap on Oct 17, 2017 11:44:16 GMT
can't see the initial 750K lasting too long before more tranches are needed be well into that £4 mill+ before owt ready to sell of the luxury apts that would enable exit all on monthly interest payments.
still it was a bullish response (bar the vendetta nonsense)
hopefully not overstretched with the big Heywood mill project as well
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r00lish67
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Post by r00lish67 on Oct 17, 2017 12:26:01 GMT
I'm surprised people are so keen whilst there's still a very valid question mark over whether the purchase price is as stated on MT (£2m) or as per the Land Registry (£1m). It's hardly a minor discrepancy. NB: I'm very much rooting for MoneyThing to be correct and for us to have missed/mis-understood something.
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Post by SophieThing on Oct 17, 2017 12:26:48 GMT
The update re NP is inspiring and much as I suspected it would be. The remaining questions are £2m vs £1m (which comes from Land Registry) and the intended use of this property. A mole who burrows locally tells me the building is in entirely the wrong place for student lets, yet this is intimated in the MT description. Agreed. SophieThing , would it be possible to get additional commentary on this? Hi registerme, I have just updated the loan description to say: (17th October 1.30pm) Answer to lender questions relating to valuation: The Land Registry shows that the building was bought in late 2016 for circa £1m by the borrower. The borrower has stated that the circumstances around the purchase were that: - The seller needed a very quick cash sale to discharge a charge-holder, before the building was placed into receivership. There were no other developers with funds to do that at the time. - As the building is a listed building the seller needed the council’s permission to sell. This meant that the sellers were only permitted to sell to a large bona fide developer which would see it through to completion of its development. They have done more conversion developments than any other company in Bradford and so the borrower was the councils preferred purchaser. The borrower has spent a total of £2.2m including costs on the building. The current valuation report has valued the property at £2m based on current market value. The above conditions no longer apply which means that if the property were to sell now, it would be on the open market with no council restriction. The Information Pack has been updated to reflect the purchase price of £1m in 2016. Kind regards Sophie
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oldgrumpy
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Post by oldgrumpy on Oct 17, 2017 12:28:22 GMT
can't see the initial 750K lasting too long before more tranches are needed be well into that £4 mill+ before owt ready to sell of the luxury apts that would enable exit all on monthly interest payments. still it was a bullish response (bar the vendetta nonsense) hopefully not overstretched with the big Heywood mill project as well Yes. That is a fabulous building. This borrower is certainly playing with the big boys.
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m2btj
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Post by m2btj on Oct 17, 2017 12:41:40 GMT
Do I sense a change of investor sentiment in this thread?
I believe that many borrowers in P2P are going to have a colourful background. The City too has more than its fair share of traders/bankers living on the edge of the law. As for a moral compass, that was lost in the stampede to the trough! My major concern with P2P lending has always been the credibility of 'professional' valuers & some of the bespoke VR's they seem to produce! If the security is there (& real) I'm in!
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oldgrumpy
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Post by oldgrumpy on Oct 17, 2017 12:51:27 GMT
Some of the questions are being answered. It is risky to infer "nuance" from written presentations, but I think the borrower's statement is his own words, and do give a positive impression as opposed to a suspicious "you would say that, wouldn't you?" reaction.
I don't think a numpty would take on that mill project!
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Post by d_saver on Oct 17, 2017 12:54:49 GMT
Agreed. SophieThing , would it be possible to get additional commentary on this? Hi registerme, I have just updated the loan description to say: (17th October 1.30pm) Answer to lender questions relating to valuation: The Land Registry shows that the building was bought in late 2016 for circa £1m by the borrower. The borrower has stated that the circumstances around the purchase were that: - The seller needed a very quick cash sale to discharge a charge-holder, before the building was placed into receivership. There were no other developers with funds to do that at the time. - As the building is a listed building the seller needed the council’s permission to sell. This meant that the sellers were only permitted to sell to a large bona fide developer which would see it through to completion of its development. They have done more conversion developments than any other company in Bradford and so the borrower was the councils preferred purchaser. The borrower has spent a total of £2.2m including costs on the building. The current valuation report has valued the property at £2m based on current market value. The above conditions no longer apply which means that if the property were to sell now, it would be on the open market with no council restriction. The Information Pack has been updated to reflect the purchase price of £1m in 2016. Kind regards Sophie Thank you for clarifying. I would however have had far more confidence to invest, if instead of saying the building was purchased for £2m, when it was not, that the docs stated it was purchased for £1M in a distressed sale, and a further £1M has since been spent on X, etc. The valuer now reports its worth at X. I'd then have far more confidence the borrower has some significant risk of his own in there.. These may seem like simple inaccuracies to some I guess, but for me, they are woeful mistakes that lead to questions that should not have been asked in the first place.
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seeingred
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Post by seeingred on Oct 17, 2017 12:55:06 GMT
Excuse me whilst I remove my rose tinted spectacles.
Oh that's better.
So the borrower didn't buy it for £1M (but in fact he did) but it was based on the borrower agreeing to its development before he was allowed to buy it, whereas the previous owner of this listed edifice, the seller, was allowed previously to buy it without any agreement to develop it?
It's becoming a little clearer.
But MT says the borrower states: etc.
But he would, wouldn't he?
But I still don't see how you manage to spend over £1 million on a building when nothing has been done to it - or has it?
Can we see some before and after photos of what has been achieved for a spend of £1 million?
I shall need my glasses again.
And can we know what exactly is now being proposed - quality residential or student lets (which I am told would not go down well in this location).
Two hours to go. To fund or not to fund. The eternal question.
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ben
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Post by ben on Oct 17, 2017 13:01:52 GMT
Morning. Site was purchased for £2m. Regards, Ed. So, not true then. In fact, almost 100% not true. What the supposed value is today is irrelevant, what you have stated is nowhere near accurate and a misrepresentation of the facts. Congratulations, you have finally reached the same level as Lendy ( or should one say sunk?). Ouch that is just mean and a bit unfair. I will be more charitable and think he meant 2 million had been spent to this point when that post was made rather then just the purchase price.
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r00lish67
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Post by r00lish67 on Oct 17, 2017 13:05:11 GMT
Agreed. SophieThing , would it be possible to get additional commentary on this? Hi registerme, I have just updated the loan description to say: (17th October 1.30pm) Answer to lender questions relating to valuation: The Land Registry shows that the building was bought in late 2016 for circa £1m by the borrower. The borrower has stated that the circumstances around the purchase were that: - The seller needed a very quick cash sale to discharge a charge-holder, before the building was placed into receivership. There were no other developers with funds to do that at the time. - As the building is a listed building the seller needed the council’s permission to sell. This meant that the sellers were only permitted to sell to a large bona fide developer which would see it through to completion of its development. They have done more conversion developments than any other company in Bradford and so the borrower was the councils preferred purchaser. The borrower has spent a total of £2.2m including costs on the building. The current valuation report has valued the property at £2m based on current market value. The above conditions no longer apply which means that if the property were to sell now, it would be on the open market with no council restriction. The Information Pack has been updated to reflect the purchase price of £1m in 2016. Kind regards Sophie Thanks SophieThing , I do appreciate MT continuing to listen to lenders concerns. The quick sale reason seems to come up frequently. To be honest though, in the event of default I can't imagine that the sale will be desired to be anything other than quick by all parties, so I'm largely discounting this as uprating the value we'll see if defaulted. Re: the council, so am I understanding correctly that if it is sold onwards, then they won't need to seek permission to sell? Why has that been lifted? In any case, surely the council would be very keen to see it sold off and made use of to the next available bidder. So, I'm not sure I see the value in this. Re: the borrower's expenditure. He spent £1m on the building. Accepting that he's spent lots more money than that, it's a bit besides the point - the only relevant point to the OMV are the factors that have materially enhanced its value to £2m? Did I read that he cleared the site? Anyway the extent of this isn't clear, and I'm just not convinced that the avoidance of needing to seek the council's blessing doubles the value. Sorry that's awfully 'down' isn't it. On the plus side, the current loan is still 75% LTV against the lower valuation, which isn't the end of the world. It doesn't feel in the same rate bracket as the hall IMV though. Edit: Having read what I've cross-posted with, I think I'm perhaps in the upbeat category now!
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GeorgeT
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Post by GeorgeT on Oct 17, 2017 13:06:09 GMT
Hmmmm. Well I didn't expect that candid statement from the borrower.I won't comment on it other than to say it's interesting and investors now have a bit more on which to base their 'in or out' decision.
Probably the bigger issue is the purchase price of £1m, the circumstances surrounding that, and the fact that MT advised it was £2m before being quizzed about it. Again, I won't comment but the DD on this one has been very useful and the delayed start time to enable this extra information to be released to potential investors was a good decision.
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stokeloans
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Post by stokeloans on Oct 17, 2017 13:08:51 GMT
You can't expect platforms to check the facts 😉
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