adrian77
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Post by adrian77 on Nov 25, 2019 12:17:37 GMT
I have just noticed on *unding not very square" the north London hotel loan farce is going on and on and on with the administrator now wanting to extend to August 2020. Clearly what we don't want here is a repeat here!
What I was thinking if practical : can selling the loan book or putting it to auction be considered rather than spending a fortune on legal fees which will probably result in a long delay before payment. I agree with other forumites - this could have been a viable business if run properly - i.e. long term property loans by people who know what they were doing and much more emphasis on liquid items such as Rolex watches etc. The business is already set-up so hopefully that is worth something and maybe better to accept , say £30m for the loan book and just get our money quickly so we can forget about this whole sad and tawdry affaire?
Just a thought - I thank you
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Post by multiaccountmanager on Nov 25, 2019 13:13:00 GMT
How would the proceeds of any overall sale be divided amongst us lenders?
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adrian77
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Post by adrian77 on Nov 25, 2019 13:15:39 GMT
good question - but we still have the problem of how to divide the administrator's fee with the current proposal
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Post by multiaccountmanager on Nov 25, 2019 13:20:54 GMT
good question - but we still have the problem of how to divide the administrator's fee with the current proposal Yes but that's a mere 2.5% Trying to divvy up a loan book sale would seem to mean accepting the concept that the trust documentation arrangements have broken down. Not something I would like to countenance. Now an ordered sale of individual loans with a good period for due diligence for bidders is something I could be more open to considering.
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adrian77
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Post by adrian77 on Nov 25, 2019 13:26:07 GMT
me neither - so let's hope this is not the case...
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aj
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Post by aj on Nov 25, 2019 13:28:08 GMT
I don't see anyone buying the whole loanbook at a price that would give the best return to investors.
Any attempts to sell the loanbook in this way would IMHO be time wasted.
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adrian77
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Post by adrian77 on Nov 25, 2019 14:54:24 GMT
quite possibly - but I was thinking maybe the business with the loan book could be sold - I just wish there was a simple solution to this complete mess...
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pip
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Post by pip on Nov 25, 2019 15:10:06 GMT
I don't see anyone buying the whole loanbook at a price that would give the best return to investors. Any attempts to sell the loanbook in this way would IMHO be time wasted. I disagree with this. I actually think selling the entire loan book may be the best way to return something to investors.
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Greenwood2
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Post by Greenwood2 on Nov 25, 2019 15:54:59 GMT
I don't see anyone buying the whole loanbook at a price that would give the best return to investors. Any attempts to sell the loanbook in this way would IMHO be time wasted. I disagree with this. I actually think selling the entire loan book may be the best way to return something to investors. Wasn't it BHS that was sold for £1. 
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pip
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Post by pip on Nov 25, 2019 16:06:43 GMT
I disagree with this. I actually think selling the entire loan book may be the best way to return something to investors. Wasn't it BHS that was sold for £1. Yes but that's because there were hardly any assets. Here we have an £80m loanbook of stinky loans. Based on the mood music, the loan book is riddled with more holes than a sieve, however it should have some value. Risk is, and I think its a very real one, that spending two years with the administrators trying to "realise the best outcome for investors" could actually end up with little in the way of recoveries and a lot in the way of administrators fees. Don't forget that the administrators are not experts in debt recovery or law so you will be spending £400 an hour on people to administrate other people who will also charge fees. Personally I think that if we could get £20m for the loanbook, return it to investors and give people 25% of their money back, I would take that. Others may disagree but I would urge everybody to not underestimate the smelly mess we are in. I actually think I would take 15%.
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Post by brightspark on Nov 25, 2019 16:30:02 GMT
Investors with loans that are perceived as likely to give a better final return will not support the proposal to sell on the entire loan book. ideally what is required is a business who are willing to step in and to take on the previous role of the platform. That way all investors would lose money proportionate to their investment. It would also allow for an early agreement of what if any is due to unsecured creditors. Effectively such a step in business would take on much of the role of Administrator without the overheads and much of the legal baggage. According to the FCA (bless them) it is what should have been in place prior to the demise of the platform
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Brainer
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Post by Brainer on Nov 25, 2019 16:50:17 GMT
Risk is, and I think its a very real one, that spending two years with the administrators trying to "realise the best outcome for investors" could actually end up with little in the way of recoveries and a lot in the way of administrators fees. Which is exactly why the administrators have proposed taking their fees as a fixed percentage of recoveries. They rightly pointed out that doing it on a time cost basis creates a potential conflict between the administrators and investors - Collateral springs to mind!
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adrian77
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Post by adrian77 on Nov 25, 2019 18:06:54 GMT
I would agree with this - maybe the loans that are junk loans could go to market as exactly that ie. junk loans - high interest but high risk of failure - I reckon some savvy investors would be interested as part of a balanced portfolio and any failures can always be written off against tax...
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james21
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Post by james21 on Nov 25, 2019 19:33:53 GMT
I would agree with this - maybe the loans that are junk loans could go to market as exactly that ie. junk loans - high interest but high risk of failure - I reckon some savvy investors would be interested as part of a balanced portfolio and any failures can always be written off against tax... Adrian, give it a rest, and the others, its over and has to take its course, you cant influence anything
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iRobot
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Post by iRobot on Nov 25, 2019 20:33:30 GMT
I would agree with this - maybe the loans that are junk loans could go to market as exactly that ie. junk loans - high interest but high risk of failure - I reckon some savvy investors would be interested as part of a balanced portfolio and any failures can always be written off against tax... Can't see how anyone buying the loan book would be anything other than catastrophic for lenders. It's a loan book of junk loans (taken in aggregate), there'll be no interest and if the recent poll was an accurate indicator there'll be a c. 50% capital loss. The only way anyone is going to be interested in buying that loan book is at 10p in the pound and target a 3-to-4-fold return for a rapid turn around. (And even that sounds risky to me. A number of loans have repaid, so some of the low-hanging fruit has already been picked.) So, on the basis the loan book as an entity may fetch no more than £8m, it would be catastrophic. (And as already mentioned, there's the thorny issue of how to distribute the proceeds. I've no desire to share the burden of failed development loans having steadfastly avoided them. And no doubt there'll be other who avoided art. Or boats.)
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