quidco
Member of DD Central
Posts: 295 
Likes: 361
|
Post by quidco on Jun 21, 2019 8:02:55 GMT
I don't mean sharing it in this way; let me illustrate in this fictitious scenario: 1.Say, Property X, one acre of land, Loan was £40,000. Valued at £100,000. 2.There are 4 lenders [Dick, Tom, Harry and Charles]. Each lent £10,000. Highest offer for whole of property is now £10,000. Which means after fees are paid, each lender would only receive less than £2500 each. So my proposition in this (admittedly unrealistically simplistic) scenario, would be either all four signs to becoming owners of the land instead of receiving paltry sum. [Or perhaps Charles isn't interested and he sells his share for £3000 to the new owners Dick, Tom and Harry]. This way, Dick, Tom and Harry [and perhaps Charles too] has acquired an asset at a very good price, giving them a chance to develop it perhaps.
[I know there's a much bigger complexity with 1000's of lenders. But apart from that, is the above even a possibility or are there other challenges [in administration law or other for example?)Any group could approach the Administrators (or whoever is winding down Lendy) and offer to purchase a development in default, anecdotally it seems some borrowers are offering to buy their own developments at knock down prices. The group would then need sufficient funds and knowledge to complete the development and sell it to recoup their money (or not). It might be an attractive proposition to some BHs heavily invested in single developments. Said anecdotal borrowers would of course still owe the remaining money they were lent.
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Jun 21, 2019 8:10:58 GMT
Any group could approach the Administrators (or whoever is winding down Lendy) and offer to purchase a development in default, anecdotally it seems some borrowers are offering to buy their own developments at knock down prices. The group would then need sufficient funds and knowledge to complete the development and sell it to recoup their money (or not). It might be an attractive proposition to some BHs heavily invested in single developments. Said anecdotal borrowers would of course still owe the remaining money they were lent. No, most of these loans are made to SPV's that are simply wound down leaving an unpaid debt. The borrower would buy using a new entity.
|
|
quidco
Member of DD Central
Posts: 295
Likes: 361
|
Post by quidco on Jun 21, 2019 8:34:32 GMT
Said anecdotal borrowers would of course still owe the remaining money they were lent. No, most of these loans are made to SPV's that are simply wound down leaving an unpaid debt. The borrower would buy using a new entity. Personal Guarantees?
|
|
|
|
Post by billy169 on Jun 21, 2019 8:42:52 GMT
Personal guarantees.ha..not seen one called in yet... We've been conned.
|
|
quidco
Member of DD Central
Posts: 295
Likes: 361
|
Post by quidco on Jun 21, 2019 8:45:14 GMT
Personal guarantees.ha..not seen one called in yet... We've been conned. Irrespective of the ability to collect, my point remains which is the borrowers would still owe the money, i.e. it's not debt restructuring.
|
|
|
|
Post by pjt1 on Jun 21, 2019 8:54:41 GMT
Personal guarantees.ha..not seen one called in yet... We've been conned. You can only call in a PG once the loss has been crystalised otherwise you don’t know how much to go after ie sold the property. You can also only call on the PG if Lendy had “clean hands”. So L would have to demonstrate in Court that they did everything correctly from their side. Begging emails to investors asking us to fill tranches don’t fill me with confidence, otherwise it would be a no brainer.
|
|
Greenwood2
Member of DD Central
Posts: 4,385
Likes: 2,784
|
Post by Greenwood2 on Jun 21, 2019 9:00:10 GMT
Personal guarantees.ha..not seen one called in yet... We've been conned. You can only call in a PG once the loss has been crystalised otherwise you don’t know how much to go after ie sold the property. You can also only call on the PG if Lendy had “clean hands”. So L would have to demonstrate in Court that they did everything correctly from their side. Begging emails to investors asking us to fill tranches don’t fill me with confidence, otherwise it would be a no brainer. There are also lawyers who specialise in getting people out of PGs. The best return I've seen on a settlement of a PG was a fraction of the PG amount to be paid over 10 or more years.
|
|
thedog
Member of DD Central
Posts: 105
Likes: 111
|
Post by thedog on Jun 21, 2019 11:29:35 GMT
Personal guarantees.ha..not seen one called in yet... We've been conned. Irrespective of the ability to collect, my point remains which is the borrowers would still owe the money, i.e. it's not debt restructuring. The scenario would be where Borrower is in Administration (Lendy's Administration is, in theory, irrelevant here). So you're right it's not debt restructuring but would be under the rules of a Borrower being in Admin.
The Administrators of Borrower are obliged to collect as much as possible for the creditors. The individuals behind Borrower might well incorporate a NewCo (or back one behind the scenes...) and make a bid for the project through that. Frequently bids of this nature are the best available as the bidders have the best knowledge of the project. Quite right that any PG would be o/s but of course there might not be one, it might be capped and they are difficult to collect (assets hidden / transferred etc). These situations are not at all uncommon in corproate deals - often executed by means of a "pre-packed Admin". Frequently used in privately-owned Retail chains and similar businesses (if the inevitable CVA has failed...) where the old owners buy out the best performing stores and leave the rest to close.
Can leave a very bad taste in the mouth but if it's the best recovery......
(I say Lendy's Admin is in theory irrelevant but in practice Borrower's Administrators will often protect themselves by obtaining agreement from the main securred lender for whatever offer they accept. In Lendy's case that would now mean the team looking after collecting out the loan book the "Back Up Servicer" or Administrator if they are filling that role and they might well be more willing to accept an offer to close the deal and move on than a "normal" lender / servicer would be).
Hope that's helpful - as may be obvious I've got commercial experience in this world....
|
|
star dust
Member of DD Central
Posts: 2,998
Likes: 3,531
|
Post by star dust on Jun 21, 2019 11:39:45 GMT
Seems the notices of administration have finally made their way to CH
and registered addresses changed to London yesterday.
|
|
|
|
Post by Deleted on Jun 21, 2019 16:51:19 GMT
Admin updates have previously hit our inboxes between 5pm-5:10pm. It's 5:50pm as I write this and nothing appears to have arrived. I assume they go home at 6pm?
Let the conspiracy theories commence. I shall begin with:
Administrators abducted by aliens.
|
|
star dust
Member of DD Central
Posts: 2,998
Likes: 3,531
|
Post by star dust on Jun 21, 2019 17:30:16 GMT
Admin updates have previously hit our inboxes between 5pm-5:10pm. It's 5:50pm as I write this and nothing appears to have arrived. I assume they go home at 6pm?
Let the conspiracy theories commence. I shall begin with:
Administrators abducted by aliens. Umm…. As the Administrators said last week – here p2pindependentforum.com/post/333612/threadSo 19 th July for the first official report on Administration (as is their statutory requirement), and in the meantime as they have been communicative before we might expect some loan update information between the 1st and 14th July and possibly anything else they feel able/appropriate to share, but that will be icing not a statutory requirement.
|
|
|
|
Post by Deleted on Jun 21, 2019 17:50:24 GMT
Admin updates have previously hit our inboxes between 5pm-5:10pm. It's 5:50pm as I write this and nothing appears to have arrived. I assume they go home at 6pm?
Let the conspiracy theories commence. I shall begin with:
Administrators abducted by aliens. Umm…. As the Administrators said last week – here p2pindependentforum.com/post/333612/threadSo 19 th July for the first official report on Administration (as is their statutory requirement), and in the meantime as they have been communicative before we might expect some loan update information between the 1st and 14th July and possibly anything else they feel able/appropriate to share, but that will be icing not a statutory requirement. "Umm..." They also said in an email to me on the 8th "I can confirm that the H********** proceeds were received shortly prior to our appointment by Lendy and are held in the client account for the benefit of investors. The next step is to arrange the allocation of the proceeds as between expenses and the return to investors and I am hopeful that at least an interim allocation can be achieved during the next fortnight or so". There has been no update whatsoever on HQ since before the administrators took over, simply referring us at the monthly update to the private portal which was last updated three days before administration. We don't even know the sale price, unlike every other stakeholder in the transaction. Why is this loan one of a very few with no further info, in spite of being the only one having had capital recovery? It adds to suspicion that there is some kind of problem with HQ, with Administrators taking over at the point in which funds were received and due to be available for withdrawal by Lenders. It does not take 4 weeks to confirm where those funds came from and who is owed them. We're not talking about withdrawing, we're talking about an allocation, ie appearing in our Lendy account to be withdrawn once the FCA will allow it. I would have thought it to be one of the easier loans to provide a monthly update and initial reconciliation on LB's "compromise" eluded to in his May update as payment was being made, rather than radio silence from Lendy.
|
|
star dust
Member of DD Central
Posts: 2,998
Likes: 3,531
|
Post by star dust on Jun 21, 2019 18:27:57 GMT
"Umm..." They also said in an email to me on the 8th "I can confirm that the H******** proceeds were received shortly prior to our appointment by Lendy and are held in the client account for the benefit of investors. The next step is to arrange the allocation of the proceeds as between expenses and the return to investors and I am hopeful that at least an interim allocation can be achieved during the next fortnight or so". I’m not in that particular loan so I’d totally missed your earlier post, but even you said approx, <snip> We'll find out soon enough, the administrators have said that HQ investors will have some figures by approx the end of next week, if not in today's weekly email, which is more than the other 95% of the loanbook are expecting in the short term. Once again this is a legal and regulatory requirement, they can't just start dispersing out millions of pounds midway through a reconciliation no matter how obvious or obscured the source and beneficiaries are. RE HQ ...when did the Admins say that? I seem to have missed this nugget of info In the email sent to me in response to specific questions I asked. They also said in last weeks email to all investors So I guess they’d effectively revised expectations then.
In Edit: Hadn't seen your edit, personally I wouldn't read much more into this than it's taking them longer than they anticipated, but I agree the situation for the investors in that particular loan is not a good one in terms of knowing/understanding the situation/outcome and that they are the last to know despite being direct loan investors.
|
|
|
|
Post by Deleted on Jun 21, 2019 18:42:26 GMT
"Umm..." They also said in an email to me on the 8th "I can confirm that the H******** proceeds were received shortly prior to our appointment by Lendy and are held in the client account for the benefit of investors. The next step is to arrange the allocation of the proceeds as between expenses and the return to investors and I am hopeful that at least an interim allocation can be achieved during the next fortnight or so". I’m not in that particular loan so I’d totally missed your earlier post, but even you said approx, In the email sent to me in response to specific questions I asked. They also said in last weeks email to all investors So I guess they’d effectively revised expectations then. Loan repayments owed to investors are taken upfront as interest held in the client account and due to be repaid to investors on a monthly basis. Capital recovery following administration and the sale of the security isn't a loan repayment, the loan contract defaulted 12 months ago. RSM are referring to existing good loans currently owing loan repayments of funds already in the client account (Taken upfront) but unavailable for withdrawal until reconciliation allows the FCA to remove the restriction on dispersing those funds. HQ security has been sold, there's no reason to restrict information such as the sale price, yet that is exactly what is happening. Something isn't right. If LB knew the administration was on the cards he wouldn't have been sending out emails up to the day before administration stating some compromise had been reached and payment was imminent, it would have been a waste of time, which leads me to suspect that the administration was sudden, forced and HQ has played a part in LY becoming insolvent, possibly banking on taking particularly high fees to the detriment of investors and then refused by the FCA. Without the fees, LY couldn't pay expenses, and so was insolvent. Did they not seek permission to dispose of the security/freehold/leasehold? That would certainly lead to the FCA removing LB as he would have been in breach of the restriction. The FCA would also have had the authority to freeze bank accounts without notification to LY, so perhaps that is what took place and then LB used the usual smoke and mirrors to unfreeze them, only to be placed into administration a few days later.
|
|
ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 11,330
Likes: 11,549
|
Post by ilmoro on Jun 21, 2019 23:24:30 GMT
I’m not in that particular loan so I’d totally missed your earlier post, but even you said approx, They also said in last weeks email to all investors So I guess they’d effectively revised expectations then. Loan repayments owed to investors are taken upfront as interest held in the client account and due to be repaid to investors on a monthly basis. Capital recovery following administration and the sale of the security isn't a loan repayment, the loan contract defaulted 12 months ago. RSM are referring to existing good loans currently owing loan repayments of funds already in the client account (Taken upfront) but unavailable for withdrawal until reconciliation allows the FCA to remove the restriction on dispersing those funds. HQ security has been sold, there's no reason to restrict information such as the sale price, yet that is exactly what is happening. Something isn't right. If LB knew the administration was on the cards he wouldn't have been sending out emails up to the day before administration stating some compromise had been reached and payment was imminent, it would have been a waste of time, which leads me to suspect that the administration was sudden, forced and HQ has played a part in LY becoming insolvent, possibly banking on taking particularly high fees to the detriment of investors and then refused by the FCA. Without the fees, LY couldn't pay expenses, and so was insolvent. Did they not seek permission to dispose of the security/freehold/leasehold? That would certainly lead to the FCA removing LB as he would have been in breach of the restriction. The FCA would also have had the authority to freeze bank accounts without notification to LY, so perhaps that is what took place and then LB used the usual smoke and mirrors to unfreeze them, only to be placed into administration a few days later. Sorry but no. Interest payments are not repayments because it doesnt diminish the sum outstanding. Capital recovered via realisation of a security asset is clearly a repayment.
Dictonary definition repayment - the action of paying back a loan.
There is no requirement for administrators to provide information to third parties which lenders are, they are responsible to the creditors/charge holder which in this case is SSSH & Lendy not individual lenders. It is up to Lendy/SSSH to determine if they will pass that info on to lenders. It may be revealed in the administration report but I dont believe it is required. Seen plenty of admin reports where it isnt.
|
|
