Post by Ace on Apr 2, 2018 16:16:09 GMT
I have recently been seduced by Kuflink's £100 bonus for a £200 investment. I had a quick scan through their website and was impressed by their 20% first loss skin. I was also impressed by the positive sentiments on p2pif, and by Kuflink's responses to comments and questions on here. This persuaded me to dip my toe to see how things went before investing substantial funds. So, having committed my massive investment of £200 I set about examining the available loans to invest in. There were 3 available for investment at the time (W*****k C*****t, G***n L**e and A***a R**d). Looking at each of these in detail I quickly realised that each had valuation issues that would have lead me to reject them on any other platform, even at substantially higher rates. I'll deal with my observations on W*****k C*****t here, but may start threads for the others later.
Sticking to an LTV of 70%, and allowing for Kuflink's first loss investment of 20% of the loan should mean that investors are exposed to maximum LTV of 56%. But, the problem here is in the definition of 'V'. Kuflink use the LTGDV figure, but this does not seem relevant here since investors are being asked to lend £814k against a current market value of £950k, which gives an LTV of 85.7%!
Further, as is started on other Kuflink loans, the more sensible figure to use is the restricted 90 Day sale value, as this is the best guess of what the asset is likely to fetch in a default situation. The restricted 90 Day sale valuation is £850k, which gives an LTV of 95.8%! Hence the conclusion that this is a very risky investment for a 7% return.
Sticking to an LTV of 70%, and allowing for Kuflink's first loss investment of 20% of the loan should mean that investors are exposed to maximum LTV of 56%. But, the problem here is in the definition of 'V'. Kuflink use the LTGDV figure, but this does not seem relevant here since investors are being asked to lend £814k against a current market value of £950k, which gives an LTV of 85.7%!
Further, as is started on other Kuflink loans, the more sensible figure to use is the restricted 90 Day sale value, as this is the best guess of what the asset is likely to fetch in a default situation. The restricted 90 Day sale valuation is £850k, which gives an LTV of 95.8%! Hence the conclusion that this is a very risky investment for a 7% return.
