rrrupert
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Post by rrrupert on Oct 22, 2018 19:32:52 GMT
Lex column in Financial Times just made a comment. Its behind the paywall but starts "Losses may exceed your initial investment...."
Broadly calling for Funding Circle type forced diversification of loans to replace individual loan selection by customers.
If you search the title "Lendy/P2P: peerful" in twitter then open the links in incognito mode they might allow access.
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Post by GSV3MIaC on Oct 22, 2018 19:46:31 GMT
Agreed, while I don’t think the FCA will get involved in any contract disputes, they will hopefully use this experience to tighten regulations or guidance. I for one would welcome clarification that, while all my Capital may be at risk, a platform cannot expose me to a risk of loss greater than my investment in any particular loan, especially when we have no sight of the loan contracts. In the context of seeking independent legal advice, has anyone recently requested a copy of the loan agreement for either of the affected loans ? The full disclosure by Lendy of info needed to mount a legal defence is possibly an area that the FCA could be pressured (by lenders) to assist with.
You can get a copy (I did) from the lawyers mentioned by Ly. I didn't see anything which was an open ended commitment to future funding, especially if the borrowers failed to provide evidence of progress relating to what they'd already had. The 'future funding commitment' question was also raised over on MT, when one of the holiday park home loans struggled to get over the line, and Ed confirmed, iirc, that there was clear indication to borrowers there that each tranche was stand alone - borrower might be S.O.L. if lenders were unwilling to fund more.
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agent69
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Post by agent69 on Oct 22, 2018 20:53:44 GMT
Whereabouts is the LY response, please? I can't find it either on the LY website or the FT comments. Under the 'News' menu option
What a load of flowery bull.
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markdirac
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Post by markdirac on Oct 22, 2018 21:39:15 GMT
You can get a copy (I did) from the lawyers mentioned by Ly. ...
You're lucky. My simple initial email to the lawyers has been ignored for a week now. Not even an acknowledgement. Has anyone else found it difficult to get in touch?
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elliotn
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Post by elliotn on Oct 23, 2018 1:04:25 GMT
I think the bigger issue here is the news that investors (us) have potential legal liabilities to the borrowers. I am fine with taking risks on my capital in return for a high interest rate. But the idea that I might have practically unlimited (or at least greater than my total assets) liability and court costs as a result of making the loan on a P2p site is quite a shock. Thankfully I'm not in this loan but I fail to see how a lender could have any outstanding and legally enforceable obligation toward a borrower. What legal duties have lenders failed to meet - that they chose not to fund a new tranche? How does the borrower even know who the existing lenders are? If Lendy has provided the borrower with that information then it must surely be in breach of customer confidentiality regulations. You must think that a borrower felt there was a contract with lenders to fund a development. The failure to honour the contract would cause them loss. Presumably lenders’ details would only be provided at the request of a judge in compliance with GDPR and Lendy would not normally provide these upon a borrower’s request. Legal Disclaimer - for the avoidance of doubt, I am referring to the implications of such lender agreements in general, not about any specific borrower or loan.
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Godanubis
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Anubis is known as the god of death and is the oldest and most popular of ancient Egyptian deities.
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Post by Godanubis on Oct 23, 2018 2:39:57 GMT
Thankfully I'm not in this loan but I fail to see how a lender could have any outstanding and legally enforceable obligation toward a borrower. What legal duties have lenders failed to meet - that they chose not to fund a new tranche? How does the borrower even know who the existing lenders are? If Lendy has provided the borrower with that information then it must surely be in breach of customer confidentiality regulations. You must think that a borrower felt there was a contract with lenders to fund a development. The failure to honour the contract would cause them loss. Presumably lenders’ details would only be provided at the request of a judge in compliance with GDPR and Lendy would not normally provide these upon a borrower’s request. Legal Disclaimer - for the avoidance of doubt, I am referring to the implications of such lender agreements in general, not about any specific borrower or loan. Are not all loans between the lenders and the borrowers that is ring fenced so money goes to the account and then to the borrowers when funded. They would have the right to see individual loan agreements. I think they would also have to sign and agree to each even if just electronically.
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rocky1
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Post by rocky1 on Oct 23, 2018 5:01:53 GMT
A few hundred Ccjs sent out might be one way to bring people to their scamming senses.
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Post by WestonKevTMP on Oct 23, 2018 6:24:25 GMT
A few hundred Ccjs sent out might be one way to bring people to their scamming senses. I understand this is probably part jest, part frustration. But one problem with CCJs for lenders is the cost;  The reality is it just isn't worth the cost. Why pay up front £1,000s when it is just throwing good money after bad. And once the CCJ is registered, the "threat" of the CCJ action has gone. This is actually a serious point, and why very few lenders actually implement CCJs.
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jo
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dead
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Post by jo on Oct 23, 2018 7:16:55 GMT
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btc
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Post by btc on Oct 23, 2018 7:25:06 GMT
I'm planning on suing fundingsecure for 1 billion dollars, the FCA won't be able to protect Funding Secure. |
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Post by lendinglawyer on Oct 23, 2018 9:11:13 GMT
I'm planning on suing fundingsecure for 1 billion dollars, the FCA won't be able to protect Funding Secure. Hopefully you're a Texas resident and can drag them to the 13th district. I didn't see a Xerox clause in their Ts&Cs.
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quidco
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Post by quidco on Oct 23, 2018 15:38:17 GMT
In the context of seeking independent legal advice, has anyone recently requested a copy of the loan agreement for either of the affected loans ? The full disclosure by Lendy of info needed to mount a legal defence is possibly an area that the FCA could be pressured (by lenders) to assist with.
You can get a copy (I did) from the lawyers mentioned by Ly. I didn't see anything which was an open ended commitment to future funding, especially if the borrowers failed to provide evidence of progress relating to what they'd already had. The 'future funding commitment' question was also raised over on MT, when one of the holiday park home loans struggled to get over the line, and Ed confirmed, iirc, that there was clear indication to borrowers there that each tranche was stand alone - borrower might be S.O.L. if lenders were unwilling to fund more.
P2P tranches are invested in by a different set of investors each time. There may be some overlap of investors who invest in one or more tranches, but equally there are investors who only ever invest in one tranche. That's how it works. So how can an investor in tranche 1 be accountable for anything related to tranche 2?
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registerme
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Post by registerme on Oct 23, 2018 16:43:16 GMT
How can an investor be accountable full stop, particularly if they never get to see the loan contract?
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invester
P2P Blogger
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Post by invester on Oct 23, 2018 17:33:22 GMT
Quite.
Going to the FCA I think is for their own protection.
What would the ramifications be if they lost the case? I can certainly see grounds for a counter claim and there probably would be no shortage of firms peddling their services.
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Post by samford71 on Oct 23, 2018 17:43:34 GMT
I’m not up to date with the specific sorry story. I think, however, that the above posters have already pointed out some very solid reasons why the lending syndicate cannot be held liable to fund further tranches.
I would add that these are not bilateral loans but were tradeable loans. I know of no precedent where someone who bought a loan in a secondary market via a novation or tear-up/replacement contract has ever been made liable to fund further tranches. This clearly would make no sense. Moreover, such as strange condition, if required, would need to be very clearly identified at the point of sale.
I see this as a complete nonsense brought by the borrower to attempt to scare lenders. Ignore it.
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