Monetus
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Post by Monetus on Aug 23, 2018 12:33:43 GMT
I see in a recent response to a review on TP, Lendy mentioned that the review incorrect because no Lender has ever lost capital. Surely this is where the rub is. If I lend someone £10000, they don't pay a penny back and the debt becomes years old, I sell the security they offered and it doesn't cover all the capital, when does that become irrecoverable? Lendy are completely in control of how the deem the status of the £45M outstanding and overdue debt, all of which is more the 6 months old. They could in theory take a deliberately long time through various small court proceedings and argue that they are still pursuing a debt that is more than a decade old. At what point will they be forced to declare some of this as un-recoverable? The exact review text for reference: "The comments and facts made are defamatory, the reviewer refers to 'lost money', when in fact none of our customers has experienced capital losses on their investments. " "The reviewer will see from particular loan updates that we are subject to a legal process and cannot expedite or accelerate matters any more than we are currently."
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michaelc
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Say No To T.D.S.
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Post by michaelc on Aug 23, 2018 12:42:29 GMT
I see in a recent response to a review on TP, Lendy mentioned that the review incorrect because no Lender has ever lost capital. Surely this is where the rub is. If I lend someone £10000, they don't pay a penny back and the debt becomes years old, I sell the security they offered and it doesn't cover all the capital, when does that become irrecoverable? Lendy are completely in control of how the deem the status of the £45M outstanding and overdue debt, all of which is more the 6 months old. They could in theory take a deliberately long time through various small court proceedings and argue that they are still pursuing a debt that is more than a decade old. At what point will they be forced to declare some of this as un-recoverable? The exact review text for reference: "The comments and facts made are defamatory, the reviewer refers to 'lost money', when in fact none of our customers has experienced capital losses on their investments. " "The reviewer will see from particular loan updates that we are subject to a legal process and cannot expedite or accelerate matters any more than we are currently." The use of that term is particularly worrying for me as it has a specific legal meaning and the of it is quite aggressive. They are a limited company and presumably the person writing the review is a consumer investor. Could you imagine (picked out of thin air) Tesco ever even giving the slightest of slight hints it might sue one of its customers because they complained about something?
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empirica
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Post by empirica on Aug 23, 2018 13:07:04 GMT
The exact review text for reference: "The comments and facts made are defamatory, the reviewer refers to 'lost money', when in fact none of our customers has experienced capital losses on their investments. " "The reviewer will see from particular loan updates that we are subject to a legal process and cannot expedite or accelerate matters any more than we are currently." The use of that term is particularly worrying for me as it has a specific legal meaning and the of it is quite aggressive. They are a limited company and presumably the person writing the review is a consumer investor. Could you imagine (picked out of thin air) Tesco ever even giving the slightest of slight hints it might sue one of its customers because they complained about something? As a thought exercise _ _ I wonder if the author could sue Lendy for defamation on the basis they labelled his post defamatory? A judge might have to make a decision as to whether investors had suffered a capital loss or not, and it may depend on the loan in question, but I could see if Lendy couldn't demonstrate that a viable plan to make good on any outstanding repayment existed, the judge may be minded to award against Lendy.
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Post by cashmax on Aug 23, 2018 13:11:52 GMT
I would have thought there was just as much scope to sue Trustpilot.
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empirica
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Post by empirica on Aug 23, 2018 13:13:40 GMT
The use of that term is particularly worrying for me as it has a specific legal meaning and the of it is quite aggressive. They are a limited company and presumably the person writing the review is a consumer investor. Could you imagine (picked out of thin air) Tesco ever even giving the slightest of slight hints it might sue one of its customers because they complained about something?
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empirica
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Post by empirica on Aug 23, 2018 13:14:20 GMT
I would have thought there was just as much scope to sue Trustpilot. How so?
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dandy
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Post by dandy on Aug 23, 2018 13:23:23 GMT
Ah, Lendy Street today, dammit! Was hoping to catch an episode of Money Hole! Does that premier on weekends>?
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Aug 23, 2018 13:30:19 GMT
I see in a recent response to a review on TP, Lendy mentioned that the review incorrect because no Lender has ever lost capital. Surely this is where the rub is. If I lend someone £10000, they don't pay a penny back and the debt becomes years old, I sell the security they offered and it doesn't cover all the capital, when does that become irrecoverable? Lendy are completely in control of how the deem the status of the £45M outstanding and overdue debt, all of which is more the 6 months old. They could in theory take a deliberately long time through various small court proceedings and argue that they are still pursuing a debt that is more than a decade old. At what point will they be forced to declare some of this as un-recoverable? HMRC definitions are fairly clear
A peer to peer loan may be accepted as having become irrecoverable when there is no reasonable prospect of the recovery of the loan. When assessing recoverability, the funds available and potentially available to the borrower must be considered. A claim therefore cannot be established simply because the borrower has insufficient liquidity on the date the loan had been called in.
Lendy would argue that until the full legal procedure has been followed the funds available or potentially available to the borrower (ie under a PG) has not been established therefore the loan has not 'become' irrecoverable.
Where Lendy are diverging from most platforms is failing to 'treat' loans as irrecoverable which they can do as soon as the loan is in legal recovery
When the borrower has entered legal recovery procedures such as liquidation, administration, receivership or bankruptcy the loan may be treated as becoming irrecoverable as if such action was not available.
Lenders can of course declare loans as having become irrecoverable but would struggle to have the info to support such a claim or treat them as irrecoverable which is slightly easier to support using public info but much easier if the platform has done it because the numbers are availiable on the tax statement and HMRC info from platform & lender would not diverge.
Lenders have suffered bad debt on Lendy but no written off losses - doesnt read as well but more accurate.
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wuzimu
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Post by wuzimu on Aug 23, 2018 15:31:22 GMT
Errrrr ref % of defaulted loans, there are 3 very large defaults hidden in the 'live' loans section of the Lendy website, which total £33m.
Counting those in with the 'non performing' list and the 'claims underway' list, I make £83m defaulted out of £180m loan book ie 46% default rate!
While I am talking numbers.... I note that Lendy state since they have been going they have paid lenders £42m interest, and that means....
for every £1 PAID to lenders on average £2 is DEFAULTED,
This ratio starkley illustrates the consumer detriment FCA should be interested in*, .... but FCA will only care if we share ... we lenders must email them * BTW I estimate Lendy revenues since 2015 is between £25m - £30m (as they charge borrowers 50% of what lenders receive plus other fees)
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Post by cashmax on Aug 28, 2018 16:30:17 GMT
Errrrr ref % of defaulted loans, there are 3 very large defaults hidden in the 'live' loans section of the Lendy website, which total £33m.
Counting those in with the 'non performing' list and the 'claims underway' list, I make £83m defaulted out of £180m loan book ie 46% default rate!
While I am talking numbers.... I note that Lendy state since they have been going they have paid lenders £42m interest, and that means....
for every £1 PAID to lenders on average £2 is DEFAULTED,
This ratio starkley illustrates the consumer detriment FCA should be interested in*, .... but FCA will only care if we share ... we lenders must email them * BTW I estimate Lendy revenues since 2015 is between £25m - £30m (as they charge borrowers 50% of what lenders receive plus other fees)
Don't you need to add the none performing and claims underway to the loan book total. If you do that, it looks much better..... 
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wuzimu
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Post by wuzimu on Aug 28, 2018 21:41:00 GMT
Thanks CashMax but I did just that!
Here is the calculation based on tonights figures:
1. 'Live loans' (that includes 'Available') £129,900k
2. 'Non-performing loans' £44,060k
3. 'Claims underway' £5,868k
4. Total Loanbook £179,891k
But 'Live' loans contains 3 big defaults in the list
that should be in the non-performing list
Loan 1 in Birmingham £14,300k
Loan 2 in Liverpool £10,768k
Loan 3 in London £ 7,452k 5. Total defaults in 'Live' list £32,530k
6. Adjusted 'Live Loans' = 1. - 5. = £129,900k - £32,530k = £97,370k 7. Adjusted 'non-performing' loans = (2. + 3. + 5.) = £44,060k + £5,868k + £32,530k = £82,458k
So tonight Total Lendy Loanbook is £179,891k of which £82,458k is defaulted at some level ie 46% default rate  I have only bothered writing this out in case the FCA read these pages.
IMO it is such numbers that need putting out there in bold, not writing rude messages on TrustPilot.
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Post by p2plender on Aug 29, 2018 7:37:25 GMT
I've contacted the FCA to make them aware of the situation here. I would urge others to at least take similar action. They do respond individually.
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Post by sayyestocress on Aug 29, 2018 9:25:00 GMT
If you're trying to calculate Lendy's default rate, then shouldn't you include the successfully completed loan value on top of the live loans value? I think as you've got the historic defaults captured in the calculation then you should have historic re-paid to get the overall picture. I'm not saying this exonerates Lendy, but I think reality is less terrible than "46% default rate".
If I've interpreted your methodology correctly (that's a big if!) and applied it to a hypothetical company that issued 100 loans of equal value, 98 of which paid back without issue, one loan is still running and performing and the remaining loan has defaulted. If you took a snapshot of the book using this methodology it would present the hypothetical company as having a 50% default rate, when historically it's only 1%.
I'm not sure if any of that made sense, but to be clear I'm not defending Lendy; I exited Lendy a while ago when things started to scare me; consider me a concerned observer.
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Post by picanto on Aug 29, 2018 9:29:09 GMT
Thanks CashMax but I did just that!
Here is the calculation based on tonights figures:
1. 'Live loans' (that includes 'Available') £129,900k
2. 'Non-performing loans' £44,060k
3. 'Claims underway' £5,868k
4. Total Loanbook £179,891k
But 'Live' loans contains 3 big defaults in the list
that should be in the non-performing list
Loan 1 in Birmingham £14,300k
Loan 2 in Liverpool £10,768k
Loan 3 in London £ 7,452k 5. Total defaults in 'Live' list £32,530k
6. Adjusted 'Live Loans' = 1. - 5. = £129,900k - £32,530k = £97,370k 7. Adjusted 'non-performing' loans = (2. + 3. + 5.) = £44,060k + £5,868k + £32,530k = £82,458k
So tonight Total Lendy Loanbook is £179,891k of which £82,458k is defaulted at some level ie 46% default rate I have only bothered writing this out in case the FCA read these pages.
IMO it is such numbers that need putting out there in bold, not writing rude messages on TrustPilot.
To assess the overall performance of Lendy, surely looking at solely the live loanbook is unfairly bias as you're not taking into account the loans which have been repaid and the interest that has been paid to investors who invested in these loans. Let's assume Lendy don't put any new loans in the pipeline and all the good loans get repaid, then obviously the only loans which will still be live will be in default/claims underway so you will have a default rate of 100%... But to draw the conclusion that Lendy have a 100% default rate would be ludicrous. Edit- sayyestocress beat me to it but is making the same point as I did.
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Post by cashmax on Aug 29, 2018 9:40:45 GMT
I agree that that 46% is not a fair figure. But there is circa £100M in default.
My worry is that the Lendy strategy appears to involve placing everything in that pot from loans that still have security in place to loans where the asset has been sold and the borrow has long since disappeared making recovery almost impossible. How big can this pot grow before things come tumbling down.
In a few weeks the other £33M hidden in live will move into the default pot too. Or perhaps they will transfer this directly to claims underway - either way thats going to swell things to more than £80M. With Lendy still claiming no capital loss.
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