ramblin rose
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“Some people grumble that roses have thorns; I am grateful that thorns have roses.” — Alphonse Karr
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Post by ramblin rose on Aug 10, 2014 9:06:49 GMT
In law, if ss are guaranteeing the return, are we lending our money to ss or to the end borrower? We are lending to 'Lendy Ltd'. SS are the intermediary, owned by Lendy, which provides the vehicle for us to lend to them, and they notionally allocate our money to certain loans. The point of this (from a simplistic point of view) is to create a repayment profile, and ensure that they don't take money in on which they have to pay interest when there isn't a loan available to cover it. By doing it this way, they've been able to create a secondary market, which creates some liquidity at times when there aren't new loans available. As far as I'm concerned it provides no diversification of risk, as you say.
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ramblin rose
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“Some people grumble that roses have thorns; I am grateful that thorns have roses.” — Alphonse Karr
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Post by ramblin rose on Aug 10, 2014 9:20:35 GMT
We still go back to the point of how SS would deal with a proper default. Yes, they will try & sell the property/boat/etc to recover monies but, after fees & so on, if what is left does not cover lenders' money PLUS interest, will Lendy cover the shortfall (I remember in Ts & Cs it says they will). If that is the case, what happens if Lendy itself goes under? I'm too tired now but I think I'll re-read the terms tomorrow morning to remind myself! Anyone else more certain of them is welcome to add their thoughts on here We discussed the default scenario recently in the thread linked to here. As you will see there, the T's & C's DON'T say they will cover the shortfall, but SS have stated (not just hinted, but not guaranteed) that they will. They haven't popped up to clarify whether this is still their intention, and it is a matter of trust, which understandably, many will consider isn't an adequate state of affairs. Anyone who has the time or inclination to read around that thread, will also see that I think, but can't be certain, we have already had the situation occur where they have done so already. I'm less clear about what has been said or written about what happens if Lendy goes under. That for me, as stated above, is the risk in lending here. I know it was discussed and we had the answer sometime months ago, but I can't remember where. I do remember that my personal conclusion was that I still attached some risk to it in my mind.
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Investor
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Post by Investor on Aug 10, 2014 10:19:52 GMT
Q1 Yes, about 38k I reckon Q2 How much will we see of the loan on the SM following drawdown. Here's hoping SS is the land of investors not flippers. Well, it's supposedly over at a smidge over £30K left, but the loan doesn't actually say so yet, so maybe there's still chance for the last few.......... But there are two more in the pipeline at stage 4 now, so latecomers might not miss out. Interesting that although cash back closed at 30k, the remainder has still flown out with only 2.5k left now. Even one 10k purchase went through today. Bodes well with the 4 in the pipeline, can't wait to see if savingstream offer different cash-back percentages on these based on the loan value to try to fill the higher loan value ones.
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Post by davee39 on Aug 10, 2014 12:20:57 GMT
In law, if ss are guaranteeing the return, are we lending our money to ss or to the end borrower? We are lending to 'Lendy Ltd'. SS are the intermediary, owned by Lendy, which provides the vehicle for us to lend to them, and they notionally allocate our money to certain loans. The point of this (from a simplistic point of view) is to create a repayment profile, and ensure that they don't take money in on which they have to pay interest when there isn't a loan available to cover it. By doing it this way, they've been able to create a secondary market, which creates some liquidity at times when there aren't new loans available. As far as I'm concerned it provides no diversification of risk, as you say. I am afraid I disagree. Lendy make the original loan and then allocates parts of it to Lenders. So if a £1000 loan is made and allocated as £100 parts Lendy recoup the £1000 to lend on a further loan. The Terms and conditions clearly indicates that in the event of a default the asset will be sold, a 5% service fee will be charged on the proceeds, and the remainder will be allocated first to return of principal, second to SS fees and 3rd to repayment of interest. There is also a warning that assets may not be sold immediately. www.savingstream.co.uk/terms - see section 5 Now with boats at a 50% LTV I am sure Lendy can manage a quick sale in the event of a default and may have suggested that they would pay lenders ahead of any auction, but property? Imagine a developer becoming insolvent, or having problems selling on. Lendy is an intermediary, having allocated on the loan parts, and only risks losing its fees (and of course lender goodwill). I really do not see them paying back a loan from their own resources.
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j
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Penguins are very misunderstood!
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Post by j on Aug 10, 2014 19:10:02 GMT
savingstream really need to ofeer clarification on the whole process & accordingly update t&c section. They have been very responsive to suggestions so far, let's hope that continues
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Post by Duane Dibley on Aug 10, 2014 19:27:38 GMT
We still go back to the point of how SS would deal with a proper default. Yes, they will try & sell the property/boat/etc to recover monies but, after fees & so on, if what is left does not cover lenders' money PLUS interest, will Lendy cover the shortfall (I remember in Ts & Cs it says they will). If that is the case, what happens if Lendy itself goes under? I'm too tired now but I think I'll re-read the terms tomorrow morning to remind myself! Anyone else more certain of them is welcome to add their thoughts on here We discussed the default scenario recently in the thread linked to here. As you will see there, the T's & C's DON'T say they will cover the shortfall, but SS have stated (not just hinted, but not guaranteed) that they will. They haven't popped up to clarify whether this is still their intention, and it is a matter of trust, which understandably, many will consider isn't an adequate state of affairs. Anyone who has the time or inclination to read around that thread, will also see that I think, but can't be certain, we have already had the situation occur where they have done so already. I'm less clear about what has been said or written about what happens if Lendy goes under. That for me, as stated above, is the risk in lending here. I know it was discussed and we had the answer sometime months ago, but I can't remember where. I do remember that my personal conclusion was that I still attached some risk to it in my mind. It was one thing Saving Stream paying out a few grand for a speedboat that went into default when the business was a few months old and trying to attract new customers, it's another thing entirely for them to pay out a couple of £million should one of the property loans go tits up. Anyone who is investing in SS on the basis that Lendy themselves will cough up should things turn sour are heading for rather a nasty surprise, in my opinion.
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j
Member of DD Central
Penguins are very misunderstood!
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Post by j on Aug 10, 2014 20:03:17 GMT
It was one thing Saving Stream paying out a few grand for a speedboat that went into default when the business was a few months old and trying to attract new customers, it's another thing entirely for them to pay out a couple of £million should one of the property loans go tits up. Anyone who is investing in SS on the basis that Lendy themselves will cough up should things turn sour are heading for rather a nasty surprise, in my opinion. I agree in the sense that what SS say will be done in the event if things going wrong, even in the most sincere good faith, is hardly legally binding. Also, even if Lendy/SS are making the rumored circa 30% then paying us 12%, that leaves a decent level of maneuver to honour verbal redemption quotes but, once again, they are not legally obliged to honour those verbal promises. It needs to be legally binding. So, again, it would be good if this can somehow be confirmed via Ts & Cs.
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vmail
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Post by vmail on Aug 14, 2014 9:06:29 GMT
Has PBL6
gone live yet? I have not received my up front interest yet
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ramblin rose
Member of DD Central
“Some people grumble that roses have thorns; I am grateful that thorns have roses.” — Alphonse Karr
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Post by ramblin rose on Aug 14, 2014 9:36:10 GMT
Has PBL6 gone live yet? I have not received my up front interest yet That's a good question. The cashback offer ended on 8 Aug and we got our cashback with the intention of the loan going live at that point, but it does still say on the loan description page that it hasn't, so maybe there has been a delay in the drawdown? Normally they are good at keeping the loan description page up to date, so it's fairly likely, but we can't know for sure. I didn't opt for any up-front interest on this loan; I did with PBL005 and that was paid very promptly. There must be others who are wondering too, so perhaps savingstream could provide a quick update.
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Post by savingstream on Aug 14, 2014 12:11:37 GMT
We are still waiting for this loan to go live, slight delay with deed of priority and various legal parties involved causing the delay. Upfront interest will be paid upon go live confirmation.
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kermie
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Post by kermie on Aug 16, 2014 10:56:24 GMT
Upfront interest is now showing as paid for PBL006, so looks like this has now drawn down.
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vmail
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Post by vmail on Aug 16, 2014 13:02:36 GMT
Mine was paid and I reinvested the intrest
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mikes1531
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Post by mikes1531 on Aug 26, 2014 16:07:57 GMT
PNL6 showing as LTV 15.3% but there is also an existing first charge mortgage for £1,450,000 I have to agree that both PBL003 and PBL006's frontpage LTVs are somewhat misleading. No doubt it's a figure that is automatically generated between asset and loan values, rather than with any ulterior motive in mind, but an LTE (Loan To Equity) value would be more appropriate, imo. I also think that the PBL003 and PBL006 frontpage LTVs are misleading. But I'm not convinced that an LTE value would be a significant improvement. Consider this -- admittedly extreme -- example... Value £1M, with prior loan of £900k, so equity of £100k. If SS lend £50k, then the LTE would be 50% -- presuming I'm making the LTE calculation correctly. That might look like reasonable security, but the overall LTV is 95%. If the borrower defaults and the property is sold in a hurry, and the proceeds amount to 90% of the valuation, then all the proceeds would go to the first lender and SS/Lendy would receive nothing. IMHO, the best indicator is the overall LTV, which is 95% in the above example. That is the fraction of the value that would have to be realised -- after all foreclosure/selling fees -- in a 'fire' sale of the property in order for SS investors to avoid losing money. In general, I would classify an overall LTV of more than about 70% to be quite risky.
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twoheads
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Programming
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Post by twoheads on Mar 2, 2017 11:54:41 GMT
PBL006 just got an extension of six months: remaining term changed from -156 to +27.
EDIT - Blimey, that's resurrected an old thread!
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Post by Deleted on Mar 2, 2017 13:24:52 GMT
PBL006 just got an extension of six months: remaining term changed from -156 to +27.
EDIT - Blimey, that's resurrected an old thread! In line with last loan book update a couple of weeks ago - if this had been 181 days and changed to plus days, one assumes would be removed from default and become as IOA loan - talk about trying to keep up - as hoy might say 'what a carry on'
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