one21
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Post by one21 on Apr 3, 2019 8:06:22 GMT
- Does anyone have the date when Ly changed their T&Cs, allowing them to take fees before Lenders funds are returned - in the event of a loan default?
- Would it happen to correlate with the rapid increase in loan defaults?
- Have they deliberately created a flawed business model which deters future investors, thereby gradually running down the company?
- Could they revert back to their original T&Cs, if they so wished, to try and save the company?
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sydb
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Post by sydb on Apr 3, 2019 14:31:06 GMT
Also taken from the London loan thread: At first I loved the idea of p2p, bringing together investors with surplus funds and borrowers needing funds for a legitimate purpose. Deals transacted through a reputable platform that would perform stringent due diligence and manage progress/repayments. However, in practice, the borrowers <potentially libellous comment removed>, the people running the platforms are <potentially libellous comment removed> and the valuers are <potentially libellous comment removed> (cynics might think they are in cahoots). The upshot being that everyone makes quick and easy money, apart from the investors who lose their shirts. In essences that are not libelous, I agree with you for certain P2P platforms, but I don't think it is fair to tar all with the same brush. The biggest difference between P2P and stock market is that P2P for the masses is relatively new. Everything under the Sun has been tried with the stock market (with the exception of those things due to changes in technology). When I was searching various review sites regarding P2P nobody mentioned the most important things that I consider have failed me: 1) Apparently massive overvaluations by regulated (RICS) valuers or, perhaps putting this another way, massive falls in valuations in very short time periods not reflected by the overall market. 2) High fees through chasing defaults and administering sales of security and the time it can take to do so. 3) When loans default and securities are sold, some platforms take their fees and their interest cut in full from the pot before capital repayment to lenders. The platform takes no financial benefit from capital being returned except, perhaps, through the payment of self generated fees for reclaiming such and taken from such. 4) Poor due diligence. Some might even say that bad borrowers with a bit of security and defaulting loans might be exactly what some platforms want because of (3) due to accruing interest on overdue repayments, as long as they are happy they have the legals in place to take the security and is of sufficient value to repay their fees and interest. |
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sydb
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Post by sydb on Apr 3, 2019 15:01:10 GMT
Does anyone have the date when Ly changed their T&Ds, allowing them to take fees before Lenders funds are returned - in the event of a loan default? Would it happen to corallate with the rapid increase in defaults? Has it created a deliberately flawed business model which deters future investors, thereby gradually running down the company? Could they change them back, if they so wished, to try and save the company? Can't remember when the T&Cs changed but it has been mentioned a number of times in the forum if you can find it. I'm no expert but on a related matter, I remember Liam saying in a video that P2P platforms, under FCA rules, are pressured (he says it is considered a negative) not to lend their own money into the loans they arrange: youtu.be/mBf17ZnuXXI?t=505
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ilmoro
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Post by ilmoro on Apr 3, 2019 15:42:30 GMT
Does anyone have the date when Ly changed their T&Ds, allowing them to take fees before Lenders funds are returned - in the event of a loan default? Would it happen to corallate with the rapid increase in defaults? Has it created a deliberately flawed business model which deters future investors, thereby gradually running down the company? Could they change them back, if they so wished, to try and save the company? Can't remember when the T&Cs changed but it has been mentioned a number of times in the forum if you can find it. I'm no expert but on a related matter, I remember Liam saying in a video that P2P platforms, under FCA rules, are pressured (he says it is considered a negative) not to lend their own money into the loans they arrange: youtu.be/mBf17ZnuXXI?t=505March 18 is when specific priority was reintroduced. Prior to that lenders merely agreed that Lendy was entitled to be repaid/reimbursed costs out of recovery but not clearly defined whether fees were included or just recovery costs.
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Post by robberbaron on Apr 3, 2019 16:41:23 GMT
Is this really true? That since lendy cannot expect to get any more money from lenders, they have no financial interest in doing anything for us whatsoever and we should expect to lose all our principal over the next ten years? Is it that simple? Any alternative views? It's actually worse than that. Lendy receives most of its fees upfront. This means its sole interest is in getting as many new loans online as quickly as possible. Not only do they have no financial interest in recovering the defaulted loans but they also have no interest in having loans that pay regular interest without defaulting. A loan could default the day after launch and they couldn't care less financially. I withdrew my funds once I understood that.
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ilmoro
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Post by ilmoro on Apr 3, 2019 17:44:01 GMT
Is this really true? That since lendy cannot expect to get any more money from lenders, they have no financial interest in doing anything for us whatsoever and we should expect to lose all our principal over the next ten years? Is it that simple? Any alternative views? It's actually worse than that. Lendy receives most of its fees upfront. This means its sole interest is in getting as many new loans online as quickly as possible. Not only do they have no financial interest in recovering the defaulted loans but they also have no interest in having loans that pay regular interest without defaulting. A loan could default the day after launch and they couldn't care less financially. I withdrew my funds once I understood that. AIUI They dont. They get the initial arrangement fee upfront (c2%) and an ongoing monitoring fee paid on a monthly basis from sums retained on drawdown in the client account. They dont get the ongloing fees upfront as they arent due (like interest) until the charging period has lapsed. Lendy are no different to any other P2P platform.
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rocky1
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Post by rocky1 on Apr 3, 2019 18:12:55 GMT
LIAM/LENDY have got plenty of interest in all of this mess of a loan book.as they will be taking agents fees+interest from any repayments from defaulted loans,and every other loan on the books.we fall in after administrators,recievers,legals, auction,liam,lendy,and whatever else they come up with.maybe not in that order as lendy reserve the right to do what they like.there are still millions of pounds of our money for them to get their hands on.no breakdowns given as to who has been taking what on last few repayments but the next 2 years could be very profitable for liam/lendy with us paying for everything that is now being out sourced so very little outgoings for lendy and big lossses for lenders caught up in this disgrace caused by liam/lendy. never mind brexit and market conditions caused this,the companies greed and mismanagement,total incompetance,lack of DD and contemt for lenders and their funds,for their own gain.once again well done CEO and founder liam you have done a great job for yourself.
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one21
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Post by one21 on Apr 4, 2019 10:19:38 GMT
Does anyone have the date when Ly changed their T&Cs, allowing them to take fees before Lenders funds are returned - in the event of a loan default? Would it happen to correlate with the rapid increase in defaults? Have they created a deliberately flawed business model, which deters future investors, thereby gradually running down the company? Could they change them back, if they so wished, to try and save the company? Can't remember when the T&Cs changed but it has been mentioned a number of times in the forum if you can find it. I'm no expert but on a related matter, I remember Liam saying in a video that P2P platforms, under FCA rules, are pressured (he says it is considered a negative) not to lend their own money into the loans they arrange: youtu.be/mBf17ZnuXXI?t=505Hi sydb thanks for the link, its certainly worth viewing! I was particularly encouraged by their answer with regard to risk, towards the bottom 5 from a scale of 1 to 10! Compared to the recent risk warning in the latest update! All due credit though to the line 'if the ducks aren't in row the process won't flow' Ah ha!
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Post by robberbaron on Apr 4, 2019 14:22:09 GMT
AIUI They dont. They get the initial arrangement fee upfront (c2%) and an ongoing monitoring fee paid on a monthly basis from sums retained on drawdown in the client account. They dont get the ongloing fees upfront as they arent due (like interest) until the charging period has lapsed. Lendy are no different to any other P2P platform. AIUI the money is still in the client account after a default and can still cover Lendy's fees. There is no indication that Lendy stops getting its fees paid in the event of a default.
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sydb
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Post by sydb on Apr 5, 2019 9:30:55 GMT
March 18 is when specific priority was reintroduced. Prior to that lenders merely agreed that Lendy was entitled to be repaid/reimbursed costs out of recovery but not clearly defined whether fees were included or just recovery costs. It would be quite useful for somebody with all the information to create a dates of times and changes to T&Cs from Lendy in order to create a reference. There was also an 'Overdue Loans Default Policy' change March 1st 2017 I believe. Thinking about it, it would be useful if there was a sticky for every P2P platform that was added to whenever there was a T&Cs change for that matter but the horse has bolted for me now.
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Mucho P2P
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Post by Mucho P2P on Apr 18, 2019 16:21:58 GMT
Does anyone have the date when Ly changed their T&Ds, allowing them to take fees before Lenders funds are returned - in the event of a loan default? Would it happen to corallate with the rapid increase in defaults? Has it created a deliberately flawed business model which deters future investors, thereby gradually running down the company? Could they change them back, if they so wished, to try and save the company? Can't remember when the T&Cs changed but it has been mentioned a number of times in the forum if you can find it. I'm no expert but on a related matter, I remember Liam saying in a video that P2P platforms, under FCA rules, are pressured (he says it is considered a negative) not to lend their own money into the loans they arrange: youtu.be/mBf17ZnuXXI?t=505Lendy as a company can not lend its own money as it does not have a Cat 730 licence from the FCA. Liam however can lend his own money on his own platform. He is just not allowed to use the "inside knowledge" to remove his capital first when he hears bad news, and has to ride it out with the rest of us. So now we all know why Liam does not lend his own money 
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sydb
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Post by sydb on Apr 19, 2019 10:35:11 GMT
Cat 730 licence from the FCA. I couldn't find any info on that. Could you give me a link to further details somewhere on the web, please?
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ilmoro
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Post by ilmoro on Apr 19, 2019 11:39:48 GMT
Cat 730 licence from the FCA. I couldn't find any info on that. Could you give me a link to further details somewhere on the web, please? Pretty sure Lendy cant lend themselves because it wouldnt comply with Article 36H which defines a p2p loan and if it didnt meet the criteria then it wouldnt be a P2P loan. if it wasnt a P2P loan then they would need article 14 permission 'dealing in investments as a principal' (plus others to actually operate) which they dont have (and wouldnt get I suspect)
Not sure what Cat 730 is though it might be IFPRU 730k but I dont think that is relevant in this context.
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sydb
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Post by sydb on Apr 19, 2019 12:09:19 GMT
So would that be this where it says P2P is only P2P if money is lent to an individual and not an incorporated body nor for business purposes if over £25k:
or is this out of context?
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ilmoro
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Post by ilmoro on Apr 19, 2019 12:41:53 GMT
So would that be this where it says P2P is only P2P if money is lent to an individual and not an incorporated body nor for business purposes if over £25k:
or is this out of context?
Yes, thats effectively article 36h but for me the most pertinent bit is
an agreement by which one person provides another person with credit (within the meaning of article 60L of the Regulated Activities Order) and in relation to which:
(i) the operator of the electronic system in relation to lending which facilitates the agreement does not provide credit (within that meaning), assume the rights (by assignment or operation of law) of a person who provided credit, or receive credit under the agreement;
If Lendy (as the platform) were lending on the loans themselves, they would be providing the credit therefore it wouldnt be P2P. (Hence why MT has to change their model & INPL was stopped) Kufflink & OC get round this by the 'skin in the game' being via another related company not the actual platform.
AIUI purely as neither a FA, lawyer or anything else remotely qualifying me to make such interpretations.
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