mikeymike
Member of DD Central
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Post by mikeymike on Jan 31, 2018 15:25:55 GMT
How common is it to find that the original planning on which a valuation was based is changed during the course of a loan. Should this always go back to the planning dept.? is there a degree of leeway built-in? or is that some developers take a chance that no-one notices or cares that they've added more floors, rooms, windows, buildings etc?
It all seems very ephemeral and makes weighing-up the odds a bit like entering the last chance casino.
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p2pclive
Blockchain specialist
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Post by p2pclive on Jan 31, 2018 19:21:42 GMT
It's pretty common, I would say this happens on about 60-70% of loans. The planning department usually isn't involved, however, as it means extra paperwork. Investing in these sorts of loans is basically gambling, but the payouts can be massive (if you know what I mean  ). Don't invest money you can't afford to lose. |
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Post by mrclondon on Jan 31, 2018 21:02:10 GMT
A significant minority of the developers taking p2p loans seem fairly slipshod with paperwork, and that includes companies house filings as well as planning applications. I don't think there are that many that would build something they don't have permission for (Lendy PBL081 a notable example though). However virtually all developments are approved by councils planning departments "with conditions" that need to be discharged, normally by submitting new application(s) that explain how the conditons specified by the copuncil are being achieved. Some conditions need discharging before development commences, others before occupation of the finished development can take place.
The efficeincy with which these condition discharge applications are handled is where so many p2p financed developers slip. As a recent example, a FS loan had pre-development conditions to provide a plan saying how the demolition would be handled to mitigate noise and dust during demolition - that plan was submitted to the council after demolition was complete and the walls of the new building were up to knee height. Some times its not clear from the councils planning portals how these discharge condition applications are being handled as practise varies between councils.
Where I think all this matters is when it comes to the exit strategy for the p2p loan being refinance. The more mainstream the finance provider, the less tolerance there will be for a paperwork trail that is lacking.
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littleoldlady
Member of DD Central
Running down all platforms due to age
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Post by littleoldlady on Jan 31, 2018 21:17:02 GMT
Speaking for my own LPA which I had better not name they love to insert lots of conditions which are usually ignored and never ever enforced.
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mikeymike
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Post by mikeymike on Feb 1, 2018 0:56:21 GMT
Thanks for the info esp. mcrlondon. Has it ever come to the point when a sale on a completed development has been lost due to it coming to light that what was being sold didn't have the required permissions? or was so far outside of permissions that the additional work had to be undone?
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Post by GSV3MIaC on Feb 1, 2018 16:25:29 GMT
Thanks for the info esp. mcrlondon. Has it ever come to the point when a sale on a completed development has been lost due to it coming to light that what was being sold didn't have the required permissions? or was so far outside of permissions that the additional work had to be undone? Lendy PBL081 was the one he quoted .. there may be others, but that's the most blatant, in that the mistakes has been built before the loan was even granted (and yes, they had to be un-built).
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Mousey
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Post by Mousey on Feb 1, 2018 17:13:33 GMT
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). Don't invest money you can't afford to lose.
