|
|
Post by batchoy on Nov 30, 2013 7:28:28 GMT
Reading the draft Credit Report on the the Hampshire Lend to Let loan listed for auction on 3rd December, I personally wouldn't describe it as a 'Lend to Let', it reads more like an 'Equity Release' (pending sale) since the borrower intends the money to settle bills and refurbish another property namely their private residence.
|
|
pikestaff
Member of DD Central
Posts: 2,136 
Likes: 1,484
|
Post by pikestaff on Nov 30, 2013 8:57:51 GMT
Quite so. The security still looks OK, but I fear it could repay very quickly. Given the risk of drawdown delays it is not for me.
|
|
|
|
Post by mrclondon on Nov 30, 2013 12:36:57 GMT
Agree "Equity Release" would be a more accurate description especially as this loan is a fraction of the the prior mortage.
The second charge does imply longer than average drawdown delay, so the return really depends on how "Defined exit on sale of property in medium term" is interpreted. With a five year loan term I would hope this means 2 to 3 years hence not next spring.
|
|
|
|
Post by mrclondon on Dec 2, 2013 21:11:20 GMT
Frustrating.
This is due to go live in a little over 12 hours time, but we still don't have a full credit report. Whilst I could be around at 1pm to bid, I'm unlikely to have time before then to read a full credit report, and carry out my own due diligence.
Yet with max bids set at £2000, this is very likely to fill within 2 minutes of going live.
Whilst I accept that certain loans effectively have a deadline by which funding must be achieved and hence delays have to be eliminated, this surely only applies to a minority of them. In all other cases at least 12 hours should be allowed for lender due diligence.
Whilst I'm reasonably confident I have correctly identified both the Redditch property and the borrower, I'm unlikely to invest in that one either until the borrower is well enough to sign off the full credit report. I spotted the full credit report at about 18:40 Saturday, the loan went live at 19:00 and it was probably 20:30 before I was sufficeintly confident I could assess the risks.
|
|
|
|
Post by batchoy on Dec 2, 2013 22:01:31 GMT
Frustrating. This is due to go live in a little over 12 hours time, but we still don't have a full credit report. Whilst I could be around at 1pm to bid, I'm unlikely to have time before then to read a full credit report, and carry out my own due diligence. Yet with max bids set at £2000, this is very likely to fill within 2 minutes of going live. I have to agree, though whilst I would like to see the full report on this one it would probably be only try to and convince myself to change my mind. At the moment my gut says that it doesn't feel right. Even if it means having to defer the start of the auction having at least 12 hours for lenders to do their own due diligence would be ideal and for the majority of loans it is probably neither here not there in the scheme of things given the current average delays between the auction ending and draw down.
|
|
mikes1531
Member of DD Central
Posts: 6,452
Likes: 2,320
|
Post by mikes1531 on Dec 2, 2013 23:11:14 GMT
Even if it means having to defer the start of the auction having at least 12 hours for lenders to do their own due diligence would be ideal and for the majority of loans it is probably neither here not there in the scheme of things given the current average delays between the auction ending and draw down. I can't imagine that a few hours' delay in funding the loan would make any real difference to anyone, including the borrower. After all, how much of what has to be done between funding and drawdown depends on the loan actually being funded rather than just knowing that it will be funded? If everyone is pretty confident that the loan will be funded, then they can proceed on the basis of that assumption. So how often do funding requests go unfulfilled? Since they disappear off the website when they're withdrawn, there's no evidence left from which to judge. I've only been here a matter of weeks, but in that time I've seen one failure. The two that are about to start are bound to succeed. The one that's active now isn't as obvious, but I expect a number of lenders are waiting to place their bids until it starts coming close to filling, so as to limit their 'dead' time. Aside from the Aberystwyth failure, have there been many others? Do I remember correctly that the interest rate on that one was pushed upwards at some point in the bidding stage in an effort to encourage more lenders? Does that happen often? I expect that's all it would take to get the current loan filled, since the rate on offer at the moment is lower than most of the loans I've seen go by lately, and less than what's available on the upcoming opportunities.
|
|
|
|
Post by mrclondon on Dec 2, 2013 23:51:45 GMT
Aside from the Aberystwyth failure, have there been many others The only other one in recent months that I can recall was one where a) the rate was single figures and b) the security was mainly a load of large LPG tanks standing in people's gardens. In the early days a couple of small lend to let loans at 6.5% were dropped, as well as a bigger one with a higher rate IIRC on IoM. There might have been an odd one or two more, but thats about it. So a pretty good strike rate all things considered.
|
|
andy2001
Member of DD Central
Posts: 361
Likes: 34
|
Post by andy2001 on Dec 3, 2013 0:37:50 GMT
Even if it means having to defer the start of the auction having at least 12 hours for lenders to do their own due diligence would be ideal and for the majority of loans it is probably neither here not there in the scheme of things given the current average delays between the auction ending and draw down. I can't imagine that a few hours' delay in funding the loan would make any real difference to anyone, including the borrower. After all, how much of what has to be done between funding and drawdown depends on the loan actually being funded rather than just knowing that it will be funded? If everyone is pretty confident that the loan will be funded, then they can proceed on the basis of that assumption. So how often do funding requests go unfulfilled? Since they disappear off the website when they're withdrawn, there's no evidence left from which to judge. I've only been here a matter of weeks, but in that time I've seen one failure. The two that are about to start are bound to succeed. The one that's active now isn't as obvious, but I expect a number of lenders are waiting to place their bids until it starts coming close to filling, so as to limit their 'dead' time. Aside from the Aberystwyth failure, have there been many others? Do I remember correctly that the interest rate on that one was pushed upwards at some point in the bidding stage in an effort to encourage more lenders? Does that happen often? I expect that's all it would take to get the current loan filled, since the rate on offer at the moment is lower than most of the loans I've seen go by lately, and less than what's available on the upcoming opportunities.
Other unfilled loans on the platform that I can think of would be an Isle of Man Property loan at 7% interest which had a very low LTV that looked like a large residential building, but was let to a subsidiary of a bank I think. There where also two loans secured on cars that failed to fill. One was about 8.5% the other was a fair but higher but I don't remember the exact number. There was a very early loan that failed to fill both as a reverse auction and fixed rate, but I forget what that one was about. There where one or two 6.5% +3.5% cash back buy to let loans that failed to fill. There was one loan with a interest rate about 8% secured on company assets which I think was dairy related which failed to fill, I hear they then got an unsecured loan with funding circle as a B grade.
The Green Deal Boiler Installer[Mod removed], and London Law[mod removed] loans both had interest rate increases to get them filled. For Green Deal Boiler Installer[Mod removed], that was from a reduced term with the same fee, which doubled the effective annualised rate to 20%.
There was a very early loan offering which was fully underwritten, which never ended up reaching drawdown. I think there was some issue where the borrower may not have been honest about the security in some way.
I can think of 3 or 4 loans which got funded but the borrower then pulled out. including a bridging loan for 800k with an 18% rate. At least this happened quickly. As did a 500k give or take loan at 10% to an employment agency secured with a second charge on the owners house. But they then got an offer by there bank to give them the loan at 5% interest. There was also 2 loans which got funded and then pulled after a long delay. 1 to a start up restaurant, and another to an hospitality company that ended using funding from an owner. Those rates where about 13% to 14%.
|
|
mikes1531
Member of DD Central
Posts: 6,452
Likes: 2,320
|
Post by mikes1531 on Dec 3, 2013 3:10:43 GMT
Aside from the Aberystwyth failure, have there been many others The only other one in recent months that I can recall was ... Other unfilled loans on the platform that I can think of would be... Thanks for the info. It's good to see the success rate seems to be improving. I suppose there's bound to be the occasional failure, so we should expect a few now and then. Looking at the list of successful loans, I see three of the 6.5% BTL ones. I was surprised that they were successful, but it just shows how little I know. I figured it took the cashback to get the funded, and it might have, but I also saw some loan parts become available a few days ago and those surprised me when they were snapped up pretty quickly -- without any cashback, of course.
|
|
|
|
Post by bracknellboy on Dec 3, 2013 7:24:46 GMT
Other unfilled loans on the platform that I can think of would be an ... There was a very early loan that failed to fill both as a reverse auction and fixed rate...There where one or two 6.5% +3.5% cash back buy to let loans that failed to fill. There was one loan with a...they then got an unsecured loan with funding circle as a B grade.
...
There was a very early loan offering which was fully underwritten...
I can think of 3 or 4 loans which got funded but the borrower then pulled out. .....
You've either been taking notes or have a very good memory
|
|
|
|
Post by batchoy on Dec 3, 2013 9:52:12 GMT
I see the full credit report has gone up and is still the listed as a 'Lend to Let', though it now reads as a combination 'Loan Consolidation'/'Equity Release' loan. Personally rather than changing my mind it has confirmed my original feelings, not one for me.
|
|
|
|
Post by mrclondon on Dec 3, 2013 12:51:17 GMT
This may be one of those cases where preserving the anonimity of the borrower has meant that my limited due diligence has led me to jump to the wrong (in this case negative) conclusions. But I'm not prepared to take the risk, so will sit this one out.
I have asked a couple of questions, but Assetz aren't going to have the time to research answers before 1pm (another reason for having at least 12 hours between full credit report and go live).
Stockbridge sounds like a nice place though (according to Wikipedia).
|
|
|
|
Post by bracknellboy on Dec 3, 2013 14:45:55 GMT
Stockbridge sounds like a nice place though (according to Wikipedia). Indeed it is a very nice place. Go there frequently for long weekends. Occassionaly thought about moving there or lining up to move there at some point in the future. Perhaps if they default I can get 0.02% of hte property and live in the shed.
|
|
