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Post by mrclondon on Aug 24, 2019 11:43:47 GMT
Many of you will recall last summer I made a road trip from London to Yorkshire via West Midlands, Merseyside + Lancashire, primarily visiting family and friends in the north, and with a bit of sightseeing en-route. Where I had time, and providing they weren't too far off the route, I stopped off to photograph the 36 ( !) p2p projects listed below. Twelve months on, and its depressing (but no major surprise) to note that very few have reached a satisfactory conclusion. Too many p2p borrowers are not focused on the projects, and seemingly don't care that expensive credit is accruing daily. There are valid reasons why for some p2p finance might be the best or only credit available, but an astute borrower would know they need to repay the debt as soon as possible. In many cases the reason for the lack of progress is simply funds have run out to complete the project, i.e. a failing to budget, but in other cases such as the luxury house on the Wirral that was finished late 2018 the reason is far from clear. Then there are the land banking transactions which were simply a means of raising capital via residual value valuations to be spent elsewhere. The order here is simply that of my route last summer:
| Platform | Loan | 2018 Post | 08/2019 Status | Subsequent Notes
| | FS | Princes Risborough | Link
| Overdue | Defaulted Nov 2019
| | FS | Oldbury
| Link | Overdue | Defaulted Nov 2019
| | FS | West Bromwich
| Link | Mostly Overdue |
| | FS | Weston Rhyn
| Link | Overdue |
| | FS | Mold | Link | Live | Defaulted Nov 2019
| | FS | Heswell, Wirral | Link | Defaulted | Partial Recovery (end 08/2019)
| | FS | Wallasey Village | Link | Overdue | Defaulted Nov 2019
| | FS | Wallasey Tower Block | Link | Defaulted |
| | FS | Wallasey Land 1 | Link | Defaulted |
| | FS | Wallasey Land 2 | Link | REPAID |
| | FS | Ber***** Rd, Birkenhead | Link | Overdue | Defaulted Nov 2019
| | FS | H*** Rd, Birkenhead | Link | Defaulted |
| | FS | Rock Ferry, Wirral | Link | Overdue | Defaulted Nov 2019
| | FS | D*ll, Rock Ferry | Link
| Partial Recovery |
| | L | Warrington | Link | Overdue |
| | FS | F*** St, Warrington | Link | Overdue | Defaulted Nov 2019
| | FS | Rusc***** Rd, Liverpool | Link | REPAID |
| | FS | Hightown Formby | Link | Partial Recovery |
| | FS | Formby | Link | Defaulted |
| | FS | Lythm St Annes Flat | Link | Overdue | Defaulted Nov 2019
| | MT | Lythm St Annes | DDC | Partial Recovery |
| | FS | Lythm St Annes Land | Link | Overdue | Defaulted Nov 2019
| | COL | B****n Rd, Blackpool | Link | REPAID (to BDO) |
| | COL | M*****r St, Blackpool | Link | REPAID (to BDO) |
| | FS | P**** Rd, Blackpool | Link | Overdue | Defaulted Nov 2019
| | MT | Lancs Resi Park | Link | REPAID |
| | COL | Darwen | Link | Overdue |
| | FS | C***** St, Accrington | Link | Overdue | Defaulted Nov 2019
| | FS | Great Harwood | Link | Overdue | Defaulted Nov 2019
| | COL | Great Harwood | Link | Overdue |
| | COL | Burnley | Link | Overdue |
| | FS | Whitworth | Link | Overdue | Defaulted Nov 2019
| | FS | Rochdale | Link | REPAID |
| | FS | D***** Rd, Oldham | Link | REPAID |
| | COL | Barnsley | Link | Overdue |
| | FS | Wakefield | Link | REPAID |
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Whilst many of you probably felt my reporting last summer seemed mad, it was surprisingly beneficial in allowing me to form a high level view of the typical 10-13% p2p project. The obvious conclusion was that platforms, and FS in particular are too trusting of what the borrowers are telling them, and that any official photographs are often from limited angles and rarely show the rear of developments. Oh ... and that residual value valuations on random plots of land with no imminent build planned are a recipe for disaster.
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Post by mrclondon on Aug 24, 2019 11:45:31 GMT
I will soon be hitting the road for this summer's trip to the north, and over the next two weeks I'll take in a sample of p2p projects en-route, particularly clusters in SW Oxfordshire, the southern and eastern outskirts of Birmingham, south and west of Durham, Preston, Staffordshire, then a few random ones along the A14/M11 back into London. I won't be posting photos for all I visit, as this year many on my list are AC projects that are generally well documented through the monthly MS reports. But where I do post photos and/or comments I'll also index them here. | Platform | Loan | 2019 Post | Subsequent Notes
| LP
| 9922376 - Abingdon, OX14
| DDC
|
| AC
| #717 - Kennington, Oxford
| Pink
|
| FS
| Property Loan Birmingham
| Link
| Defaulted Nov 2019
| FS
| W*** Gr*** Rd, Birmingham
| Link
| REPAID Nov 2019
| FS
| Commercial Property, Yardley
| Link
|
| FS
| Col********* Avenue, Birmingham
| Link & DDC
|
| AC
| #797 - East Leeds
| Pink
|
| FS
| Ripon Properties
| Link
|
| FS
| F**** H*** S******, Durham
| Link
|
| FS
| Roddymoor Creek, County Durham
| Link & DDC
|
| AC
| #1116 Longridge, NE of Preston
| Pink
|
| FS
| Duke Street, St Helens
| DDC
| Defaulted Nov 2019
| AC
| #578 - Crewe
| Pink
|
| L
| DFL007 - Crewe
| Link
|
| AC
| #811 - Blurton, Stoke on Trent
| Pink
|
| FS
| Property in Meir, Stoke on Trent
| Link
| Defaulted Nov 2019
| FS
| Ch**** Street, Stanwick
| Link
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| FS
| Huntingdon 4 bed detached house
| DDC
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| L
| DFL016 - M***** Row, Harlow
| Link
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ashtondav
Member of DD Central
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Likes: 1,092
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Post by ashtondav on Aug 24, 2019 12:35:27 GMT
You’re a brave man.
i just stick my head under a pillow and weep. Thank goodness FS was my smallest p2p.
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Post by samford71 on Aug 24, 2019 13:22:10 GMT
I think mrclondon needs a soundtrack to that roadtrip. Here's two tracks to get you in that 'P2P' mood: link & link
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Post by mrclondon on Aug 24, 2019 14:10:10 GMT
I think mrclondon needs a soundtrack to that roadtrip. Here's two tracks to get you in that 'P2P' mood: link & link
Very good .... particularly the first one.
I very rarely post youtube links, but by the time I reached Blackpool, this of the famous Blackpool clown (a childhood memory) began to feel like the soundtrack to my trip .... we are, in many cases, being taken for fools and are literally being laughed at by some borrowers.
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agent69
Member of DD Central
Posts: 6,044
Likes: 4,437
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Post by agent69 on Aug 24, 2019 14:15:50 GMT
Many of you will recall last summer I made a road trip
And two thirds of the sites you visited subsequently defaulted, or are overdue?
Based on that record some might be happy to pay you to keep away from developments they have a financial interest in.
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macq
Member of DD Central
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Likes: 1,199
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Post by macq on Aug 24, 2019 15:53:16 GMT
think this thread could have been my biggest eye opener and that's before you add to it!
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bigfoot12
Member of DD Central
Posts: 1,817
Likes: 816
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Post by bigfoot12 on Aug 24, 2019 16:05:28 GMT
I think mrclondon needs a soundtrack to that roadtrip. Here's two tracks to get you in that 'P2P' mood: link & link
Almost every rock song that YouTube suggested next seemed appropriate, as well:- Road to Hell, Everybody hurts, Paranoid, Another Brick in the Wall, The Man Who Sold the World, Whatever you want, Don't Stop Believing, Here I go again, Living on a Prayer, Poison, We're not going to take it, Still Got the Blues, Should I stay or should I go (more property partner than P2P), The Final Countdown? (? is my addition), Money for nothing, ....
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agent69
Member of DD Central
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Likes: 4,437
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Post by agent69 on Aug 24, 2019 16:26:08 GMT
Almost every rock song that YouTube suggested next seemed appropriate, as well:- I guess this could go on forever, but I did think that The long and winding road (to full recovery of capital and interest) was appropriate.
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star dust
Member of DD Central
Posts: 2,998
Likes: 3,531
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Post by star dust on Aug 24, 2019 17:19:05 GMT
I think mrclondon needs a soundtrack to that roadtrip. Here's two tracks to get you in that 'P2P' mood: link & link
Almost every rock song that YouTube suggested next seemed appropriate, as well:- Road to Hell, Everybody hurts, Paranoid, Another Brick in the Wall, The Man Who Sold the World, Whatever you want, Don't Stop Believing, Here I go again, Living on a Prayer, Poison, We're not going to take it, Still Got the Blues, Should I stay or should I go (more property partner than P2P), The Final Countdown? (? is my addition), Money for nothing, .... And not to forget that P2P anthem ' Hotel California' for the zombie loans tying you to that Platform you'd love to leave ..... it all seemed such a good idea at the time......
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ashtondav
Member of DD Central
Posts: 1,814
Likes: 1,092
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Post by ashtondav on Aug 25, 2019 9:57:05 GMT
“Muppet Show” theme tune.
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bugs4me
Member of DD Central
Posts: 1,845
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Post by bugs4me on Aug 26, 2019 10:00:25 GMT
'.... we are, in many cases, being taken for fools and are literally being laughed at by some borrowers....' mrclondon - you sound totally disillusioned by P2P as it exists today although it wasn't always like that. Until many charlatans got involved, the platforms that is, with individuals claiming false, fictitious, not accurate, 'pumped up' expertise in the financial sector then everything was okayish.
Unfortunately, aided and abetted by the FCA, these 'expert' individuals behind many platforms are simply amateurs playing with other folks hard earned cash. And the cost to themselves for failure would appear to be zero. All very sad for those that are seriously affected financially with zero recourse.
On the forum there are many threats made about taking matters further when there has been serious and obvious errors made by the platforms involved. As usual though nothing will ever materialise. Lenders are not organised and the platforms are fully aware of this. So whilst borrowers may take lenders as fools, so do the platforms - their actions or a lack of, speaking far louder than yet another meaningless update.
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Post by mrclondon on Aug 26, 2019 13:01:38 GMT
'.... we are, in many cases, being taken for fools and are literally being laughed at by some borrowers....' mrclondon - you sound totally disillusioned by P2P as it exists today
Disillusioned ... yes, absolutely.
Over the course of the last ten years p2p has been a learning experience both for lenders and the platforms who were / are mainly staffed by individuals with insufficeint experience in the underlying security asset classes. I've learnt from my own mistakes along the way, and put effort into continuing to analyse and learn from the lifecycle of p2p loans, both those I'm in and those I've rejected for whatever reason.
My disillusionment stems mainly from the apparent unwillingness of platforms to make a serious effort at understanding and learning from the many disasters in their current loanbooks (never mind those of their closest competitors). The biggest disasters are unsurprisingly the over committment of multiple loans to a single borrower which almost all platforms have experienced, and an over reliance on residual value valuations for assets with low resale demand. The fact that so few (if any ?) platforms have taken on NEDs with a lifetime's experience in secured lending in mainstream financial organisations is perhaps part of the reason.
Change is coming in the form of restricted marketing of p2p (i.e. restricted vs sophisticated vs HNW) thanks to the (better late than never) new rules from the FCA. No-one can even guess at what effect this will have on the supply of new sacrificial lambs entrants as p2p lenders but a massive contraction in supply is a possibility.
Larger lenders aka 'BH' (big hitters) have tended to support the launch of new loans by acting as quasi-underwriters, and then after extracting a few months retained interest from the loan (a relatively low risk operation) attempted to sell on SMs to those with less understanding of the underlying risks. With what could be a far smaller pool of small/medium retail lenders in the future, BHs may be increasingly reluctant to over commit at the launch of a loan as being forced to hold to maturity could become more common.
In my view, if they want to survive, platforms will have to reinvent themselves. And that is going to mean the hard graft of actually learning what it is that has made so many of the p2p loans of the last 6 years astronomically high risk.
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Post by samford71 on Aug 26, 2019 13:44:56 GMT
mrclondon - you sound totally disillusioned by P2P as it exists today although it wasn't always like that. Until many charlatans got involved, the platforms that is, with individuals claiming false, fictitious, not accurate, 'pumped up' expertise in the financial sector then everything was okayish.
Unfortunately, aided and abetted by the FCA, these 'expert' individuals behind many platforms are simply amateurs playing with other folks hard earned cash. And the cost to themselves for failure would appear to be zero. All very sad for those that are seriously affected financially with zero recourse.
On the forum there are many threats made about taking matters further when there has been serious and obvious errors made by the platforms involved. As usual though nothing will ever materialise. Lenders are not organised and the platforms are fully aware of this. So whilst borrowers may take lenders as fools, so do the platforms - their actions or a lack of, speaking far louder than yet another meaningless update. Platforms and borrowers may take lenders as fools but, to be honest, in many cases that has been a very accurate description of their investor base. The 'greater fool' approach to investment has often worked admirably in P2P.
P2P platforms would find it harder to treat lenders with the arrogance that they do, if those lenders were less arrogant about their own abilities themselves. I've been at the sharp end of the industry for over 20 years and I don't have a fraction of the self-belief some of you guys do. Worse, it's not self-belief based on hard data, experience and mathematical analysis. It's overconfidence based on gut instinct, feelings, common sense; factors irrelevant in sound investment. Some of you just make it too easy for the dreg ends of the financial services industry to take advantage of you.
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Post by GSV3MIaC on Aug 26, 2019 13:46:42 GMT
Me too.. After 6 or 7 years in the game, it is obvious that..
The platforms don't listen and learn The lenders, even those reading the forum, don't listen and learn Too many borrowers are incompetent, crooked, or fantasists. The interests of the platforms appears to be directly in opposition to the interests of the lenders, at least in the short term, which is all most of them seem to care about.
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