|
|
Post by andrewholgate on Oct 20, 2017 10:29:08 GMT
Thank you for highlighting this. The questions you have raised are perfectly valid and having reviewed this they should have been addressed in the credit report.
Assetz Capital have known of the history surrounding the borrower’s partner since February. Both the borrower and her partner made this clear to us back in February and as Chief Credit Officer I made the decision to continue with the loan application knowing this information.
On her partner, he was convicted, he has served time in prison and several years have passed since then. This will soon be wiped from the public record under the Rehabilitation of Offenders Act (RoO Act), but under the act no-one can discriminate against him for his conviction. News reports still appear on Google and he made this clear to us without us needing to ask. However, he is not the borrower but a connected party.
For clarity, the borrower has a clean record and her partner is not party to the loan. As part of the process, the borrower’s solicitor has a duty of care to ensure that the funds being used to purchase the property are legitimate. They will have undertaken their Anti Money Laundering checks and will have required evidence to show where these funds were from. They would not have allowed the transaction to happen if they felt the funds were from the proceeds of crime. The solicitors have confirmed to us they are happy.
This detail should have been included in the credit report. I took some time last night to explain this to our team and the report is being updated to reflect this information. I would ask that speculation as to the source of funds stops here as there is a real risk of the RoO Act being breached. The loan will not proceed until I am satisfied everything is in order.
I apologise that this information wasn’t included in the credit report but I assure you all that it was known through the credit process.
|
|
|
|
Post by peerlessperil on Oct 20, 2017 11:07:54 GMT
I’ll make a full statement tomorrow. Whilst we are on this topic would AC care to make a similar statement regarding Loan #465 - where I would argue the concerns over a connected party's past behaviour were much more relevant from a lender's perspective? The credit report on that loan is of much greater concern than this one - at least the author in this case hinted rather heavily that the connected party had spent a period with too much time on his hands. I had presumed that AC wasn't permitted to disclose the histories of connected parties for discrimination reasons, but your statement above seems to indicate that is not the case. Many thanks pp
|
|
|
|
Post by andrewholgate on Oct 20, 2017 12:00:15 GMT
I will investigate 465 and revert. I am away for a few days but please bear with me.
|
|
SteveT
Member of DD Central
Posts: 6,875 
Likes: 7,924
|
Post by SteveT on Oct 21, 2017 6:20:10 GMT
Putting aside the personal aspects, the fact that AC can now fill dubious quality commercial bridging loans (headline 75% LTV but close to 100% of the price actually paid upfront) to highly inexperienced borrowers at a rate of just 10% is rather depressing. I hadn't looked at this loan until now, ignoring it initially on the basis of LTV alone. Now I come to look at it, I reckon it's at least 3-4% under-priced for the risk. Oh well, my progressive AC exit continues.
|
|
liso
Member of DD Central
Posts: 390 
Likes: 394
|
Post by liso on Oct 21, 2017 8:18:51 GMT
How do you know the borrowers are highly inexperienced?
I bought an -admittedly small - part of this loan, and I've been investing for years 
|
|
SteveT
Member of DD Central
Posts: 6,875
Likes: 7,924
|
Post by SteveT on Oct 21, 2017 8:27:10 GMT
How do you know the borrowers are highly inexperienced?
I bought an -admittedly small - part of this loan, and I've been investing for years
I read the Credit Report. And you’re a lender, not the borrower.
|
|
liso
Member of DD Central
Posts: 390
Likes: 394
|
Post by liso on Oct 21, 2017 9:43:48 GMT
Oops sorry, my bad. I've got Saturday morning...err...brain fog  |
|
ton27
Member of DD Central
Posts: 431
Likes: 267
|
Post by ton27 on Oct 21, 2017 13:25:30 GMT
I went for a small investment but as usual got an even smaller amount with an allocation of just £70. I am also exiting AC but mostly to do with decreasing rates (but not risk) and minuscule allocations.
|
|
oldgrumpy
Member of DD Central
Posts: 5,087
Likes: 3,233
|
Post by oldgrumpy on Oct 21, 2017 13:51:45 GMT
I went for a small investment but as usual got an even smaller amount with an allocation of just £70. I am also exiting AC but mostly to do with decreasing rates (but not risk) and minuscule allocations.Yes, AC know exactly how many people have given a buy instruction prior to drawdown. They know what proportion of each loan is going to be allocated to each account(MLIA, GBBA etc). They could quite easily, the day before actual drawdown put an indication somewhere on the loan instructions page about what individual allocations are likely to be. For instance, with this one AC could easily have said "likely allocation <£100. On another, <£20. On another >£1500, etc. That would greatly assist lenders in making sure that enough (but not excessive) cash could be transferred. AC resolutely refuses to help in this way.
|
|
|
|
Post by andrewholgate on Nov 3, 2017 14:00:18 GMT
I will investigate 465 and revert. I am away for a few days but please bear with me. Just to say, the loan in question repaid in full.
|
|
|
|
Post by peerlessperil on Nov 6, 2017 13:41:53 GMT
I will investigate 465 and revert. I am away for a few days but please bear with me. Just to say, the loan in question repaid in full. Thanks, but this is not really relevant to the question being asked and it looks as if you are ducking the question. What we would like to know is when Assetz sees fit to declare the prior behaviour of a connected party and when it doesn't, as the lack of consistency here is of concern. The credit report for Loan #465 (and indeed for related loan #508 which you are of course fully aware of) made no mention of the prior behaviour of a closely connected party that would have been of undeniable interest to any lender considering the loans. What is the policy please?
|
|
|
|
Post by andrewholgate on Nov 6, 2017 15:09:01 GMT
In my personal view, everything should be declared and we strive to ensure that happens. However, the borrower, who approves the paper we produce as factually correct and agrees to the publication of the information, may wish not to disclose some information.
|
|
|
|
Post by peerlessperil on Nov 6, 2017 15:16:44 GMT
In my personal view, everything should be declared and we strive to ensure that happens. However, the borrower, who approves the paper we produce as factually correct and agrees to the publication of the information, may wish not to disclose some information. Thank you - that does make things much clearer.
|
|
mikes1531
Member of DD Central
Posts: 6,453
Likes: 2,320
|
Post by mikes1531 on Nov 7, 2017 3:48:15 GMT
In my personal view, everything should be declared and we strive to ensure that happens. However, the borrower, who approves the paper we produce as factually correct and agrees to the publication of the information, may wish not to disclose some information. Thank you - that does make things much clearer. But where do AC draw the line? Does this mean that any factual item that doesn't put the borrower in a favourable light can be removed by them despite it possibly being influential on investors' decisions whether or not to support that loan? I'd have thought that being economical with the truth might be nice for the borrower but potentially misleading to the investor. This isn't a problem if the borrower repays the loan as agreed. But if the borrower defaults and it subsequently comes out that AC knew certain things about the borrower that increased the loan's risk but allowed those facts to be withheld from potential investors then it wouldn't surprise me in the least if AC were to be crucified in public for misleading their investors. IMHO that's a risk AC shouldn't be taking, though I must admit that this view might be biased slightly because I'm an AC shareholder as well as an investor. At the risk of possibly putting off some borrowers, I'd tell them that full disclosure within the platform is a condition of AC loans.
|
|
|
|
Post by GSV3MIaC on Nov 7, 2017 7:37:51 GMT
+3
If the borrwer 'might not want to disclose some information' (which AC thought relevant enough to document) then i'd at least expect to hear 'some information redacted by borrower' incase I 'might not want to lend some money' under those conditions .. though in the QAA or GBBA I guess I might have no choice.
|
|
