cb25
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Post by cb25 on Mar 20, 2018 14:06:26 GMT
The PF is pointless: 1. It's supposed to cover capital yet it wont payout until the capital is recovered. If it's covering my capital, why can't I have the capital, why do I have to wait for recovery? 2. It covers interest payments but only late payments where receipt is imminent. Once the borrower actually defaults (or AC arbitrarily suspends the loan) the PF doesn't pay. As loans are suspended as soon as a borrower late pays and in some cases well before they default, the PF is only ever expected to cover pennies. 3. The PF is discretionary. That means AC can choose if they even use it so the rules above are 'discretionary'. As they like to market that the PF has never had to payout, likelihood is they wont ever use it. Assetz Capital attract lenders with the promise of the backup of a provision fund but make damm sure it will never have to payout. I have a 4-figure sum in loan 227 which has been extended twice, each for 3 months, with no interest paid out. Technically the interest is accruing, but that depends on the borrower being able to pay. AC's update of 15 March states "Extension Deadline – At the current point, the borrower has not been able to either raise sufficient funds via a refinance or secure the sale of sufficient assets to repay either the outstanding capital or the accrued interest by 31 March 2018. It is therefore highly likely that a request for additional extension to the current borrowing will be made to lenders by the borrower" Seems that AC's only plan is to keep kicking the can down the road. That way, the loan never comes to an end, hence won't be counted as defaulted, so no need to try and recover the money (with the almost-never-used PF used to make up any loss). AC's weak points are i) poor diversification, ii) non-transparent criteria used for defaulting loans, iii) non-transparent use of the PF As FC's property loans of old showed, P2P platforms can prosper even when lots of loans go t*ts up as the platform makes money from arranging the loan, they're not that much affected - and not remotely much as lenders - if the loan fails. As long as they can keep attracting lenders and borrowers, they'll do OK.
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jo
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dead
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Post by jo on Mar 20, 2018 15:57:06 GMT
Given the prevailing tense atmosphere in P2P, where even a self-inflicted failed log in can cause momentary palpitations, if I was running a platform I'd be sidelining web upgrades and going all out to deliver a 'banner' recovery - as a boost for the troops.
Otherwise a few of them are going to have a Withdrawals-shaped problem, I fear.
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Post by petebutt43 on Apr 1, 2018 23:21:54 GMT
If you are worried about provision funds then go to a platform that doesn't need one - Mintos. Selected loans are bought back by the originator if they go to 60 days late payment. Simples. And a MUCH better rate than AC. Currently my portfolio is running at 12.67% ACTUAL return per annum. I think AC is not fit for purpose, IMHO, offerring the SAME dodgy loans but at much lower rates. How is that attractive?
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ashtondav
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Post by ashtondav on Apr 2, 2018 6:29:10 GMT
My concern about Mintos is size. It’s too small and risky for me!
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Post by petebutt43 on Apr 2, 2018 6:35:39 GMT
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angrysaveruk
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Say No To T.D.S
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Post by angrysaveruk on Apr 2, 2018 8:58:09 GMT
If you are worried about provision funds then go to a platform that doesn't need one - Mintos. Selected loans are bought back by the originator if they go to 60 days late payment. Simples. And a MUCH better rate than AC. Currently my portfolio is running at 12.67% ACTUAL return per annum. I think AC is not fit for purpose, IMHO, offerring the SAME dodgy loans but at much lower rates. How is that attractive? The idea of the platform buying back the loans is interesting. But do they have the money to do this if there are a large number of defaults? I guess it shows they have confidence in the security underlying the loans. I am currently in two minds about AC, although I have recently increased my holding with them I am going to see how they deal with the recovery of a recently suspended series of loans totalling a fairly considerable 7 figure sum (all from the same borrower) before I decide to stay with them long term.
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Post by petebutt43 on Apr 2, 2018 12:59:30 GMT
If you are worried about provision funds then go to a platform that doesn't need one - Mintos. Selected loans are bought back by the originator if they go to 60 days late payment. Simples. And a MUCH better rate than AC. Currently my portfolio is running at 12.67% ACTUAL return per annum. I think AC is not fit for purpose, IMHO, offerring the SAME dodgy loans but at much lower rates. How is that attractive? The idea of the platform buying back the loans is interesting. But do they have the money to do this if there are a large number of defaults? I guess it shows they have confidence in the security underlying the loans. I am currently in two minds about AC, although I have recently increased my holding with them I am going to see how they deal with the recovery of a recently suspended series of loans totalling a fairly considerable 7 figure sum (all from the same borrower) before I decide to stay with them long term. AC is not the only platform suffering with large defaults. Half my portfolio on MT went tits up last month and I had/have(?) 16k in Collaterall. I just wish I had put more into Mintos before the brexit desbacle. The Mintos platform is only a vehicle for other lenders, like Mogo, which offer the buy-backs.
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ashtondav
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Post by ashtondav on Apr 2, 2018 17:21:16 GMT
Experience with FS would indicate you should expect the recovery process for a defaulted loan to take about two years. As I understand it, when the asset has been sold the PF pays any balance of rolled up interest and capital that is not covered by the net sales proceeds. Until sufficient diversification (1%) is assured I will stick with MLA and QAA and the thirty day accounts.
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jonah
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Post by jonah on Apr 2, 2018 17:57:03 GMT
Experience with FS would indicate you should expect the recovery process for a defaulted loan to take about two years. As I understand it, when the asset has been sold the PF pays any balance of rolled up interest and capital that is not covered by the net sales proceeds. Until sufficient diversification (1%) is assured I will stick with MLA and QAA and the thirty day accounts. The capital yes, no interest on defaulted loans will come from AC PF. Of course if the asset sale provides enough cash, that could cover some or all of the deferred interest.
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angrysaveruk
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Say No To T.D.S
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Post by angrysaveruk on Apr 2, 2018 21:24:50 GMT
The idea of the platform buying back the loans is interesting. But do they have the money to do this if there are a large number of defaults? I guess it shows they have confidence in the security underlying the loans. I am currently in two minds about AC, although I have recently increased my holding with them I am going to see how they deal with the recovery of a recently suspended series of loans totalling a fairly considerable 7 figure sum (all from the same borrower) before I decide to stay with them long term. AC is not the only platform suffering with large defaults. Half my portfolio on MT went tits up last month and I had/have(?) 16k in Collaterall. I just wish I had put more into Mintos before the brexit desbacle. The Mintos platform is only a vehicle for other lenders, like Mogo, which offer the buy-backs. To be fair my experience with AC has been pretty good. Only 1% of my portfolio has been suspended. I think AC should offer a market where suspended loans can be purchased and sold at a heavy discount. I would be more than happy to dump my suspended loans for 50% discount on the face value. Buying suspended loans could be an interesting market for people willing to take a gamble with the potential for a substantial payoff, and provide liquidity for those who dont want to wait for the recovery process. AC having a "discretionary" provision fund is sensible imo - AC are not making promises they cant keep. I am very glad I didnt have any exposure to the Collateral platform mess, I would not be at all surprised if there was some legal problems with the loans they have issued.
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cb25
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Post by cb25 on Apr 3, 2018 13:29:49 GMT
Loan 227, which AC have just noted as being 'in default', might (unfortunately) become a test case of the value of the provision fund, due to the size of the loan.
Having said that, I hope AC can recover the money we've lent (100%) without recourse to the PF. Time will tell.
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teddy
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Post by teddy on Apr 5, 2018 23:14:50 GMT
By not allowing lenders to vote on enforcing the loan and going straight to insolvency proceedings, AC are effectively trying to stop lenders from getting their money back. An intolerable situation. What with this loan and the windmills, the PF is on the hook for about £11m. I have little hope for the future.
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happy
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Post by happy on Apr 6, 2018 9:12:45 GMT
By not allowing lenders to vote on enforcing the loan and going straight to insolvency proceedings, AC are effectively trying to stop lenders from getting their money back. An intolerable situation. What with this loan and the windmills, the PF is on the hook for about £11m. I have little hope for the future. Not sure why you think A.C. are not allowing lenders to vote vote on enforcing the loan. This is a but one stage in a process aimed at achieving the best outcome in terms of repayment or recovery. Time and again over the recent past AC have achieved a recovery that few thought achievable and the multitude of posts here show the gratitude of many of our fellow posters for their exceptional efforts. Effective management and recovery of troubled loans takes time and measured action not just simply enforcing your rights to an asset just because you can. This course of action rarely brings the best results however where it has been needed in the past AC have taken swift action to secure assets, sell them and then pusue all other avenues for further recovery. As for the PF being on the hook for £11m, not quite sure where that figure comes from unless you just added up the value of these loans. Unlikely that 100% of these loans are sitting in the PF protected accounts and as the PF only covers any potential loss after sale of the assets any potential PF payout will likely be a small fraction of that £11m figure you have put out there. IMHO if you want to surround yourself with doom and gloom prophecy there are a few other platforms you should be investing in rather than A.C. It's never a perfect world,  happens and it is how you deal with that that sets you apart from the rest. P.S. so glad you are back posting here again😁
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cb25
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Post by cb25 on Apr 6, 2018 9:18:31 GMT
By not allowing lenders to vote on enforcing the loan and going straight to insolvency proceedings, AC are effectively trying to stop lenders from getting their money back. An intolerable situation. What with this loan and the windmills, the PF is on the hook for about £11m. I have little hope for the future. Not sure why you think A.C. are not allowing lenders to vote vote on enforcing the loan. By neglecting their own T&Cs (below) and letting the borrower dictate the vote, both on this occasion and the next. "13. Default Procedures If the Assetz Agent becomes aware of a default in the payment of any principal, interest or fee payable under any Loan Agreement or if it otherwise receives notification of an event of default under the terms of any Loan Agreement, it shall promptly: notify the relevant Lending Syndicate Members of the relevant circumstances; and put together a suitably qualified default management team" This loan IS in default (lender vote text stated that), yet AC say it's up to the borrower what they want to try next. Unfortunately for us, it's in AC's interest to let the borrower dictate this, as it keeps AC away from having to use the PF.
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happy
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Post by happy on Apr 6, 2018 9:38:17 GMT
Saying that a borrower may choose a particular option in the future does not in any way mean that AC cannot force that same option on the borrower. They have not said that they have waived any rights they(we) have over the assets and/or the borrower. I see that we are at a stage in negotiations where AC are allowing/assisting the borrower to arrive at a mutually agreed outcome, whatever that may turn out to be. This approach can hopefully result in a much more desirable place to be in that preserves relationships and value for all our benefit.
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happens and it is how you deal with that