a0010402
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Post by a0010402 on Dec 7, 2022 11:45:57 GMT
7k of Kit*ers L* available. I'm already at my limit, I don't invest much in 2nd charge loans. There's been some recent secondary market activity, might be worth some DD first.
It has defaulted.
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Post by overthehill on Dec 7, 2022 14:57:05 GMT
7k of Kit*ers L* available. I'm already at my limit, I don't invest much in 2nd charge loans. There's been some recent secondary market activity, might be worth some DD first.
It has defaulted.
Presumably because it was more than 6 months late. It paid a year's interest up until june 2022. What are the prospects for full capital repayment on a 0-10 scale ?
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a0010402
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Post by a0010402 on Dec 7, 2022 15:23:52 GMT
No idea, but on this we both showed some hesitation earlier ( here was mine). I am currently overloaded one of the Bl*****l guest houses however, and invested in two. Could my self-preservation instincts be misfiring?
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Post by overthehill on Dec 7, 2022 15:44:39 GMT
No idea, but on this we both showed some hesitation earlier ( here was mine). I am currently overloaded one of the Bl*****l guest houses however, and invested in two. Could my self-preservation instincts be misfiring?
I'm done with single borrower / multiple loans after fundingsecure and ablrate. One Bl******* loan is enough for me.
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nick
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Post by nick on Dec 7, 2022 17:01:42 GMT
Presumably because it was more than 6 months late. It paid a year's interest up until june 2022. What are the prospects for full capital repayment on a 0-10 scale ?
I have a small amount invested in this one and have done a back of the envelope calc of the likely loss if the borrower is pushed into LPA receivership - its not pretty: First charge loan: £584k Say 15% penalty int on 1st charge loan: £88k (assumes that they stopped paying interest on the first charge loan in June - probably overly conservative as I suspect they have been paying them) Second charge loan (ours): £343k Total debt before our int: £1,015k
Market value of site per July survey: £1,185k (doesn't look like much has progressed since July's survey) less 25% haircut -£296k (for distressed sale, LPA & other fees, ours & first charge holders etc etc) Net recoverable amounts to debtors £889k
Capital shortfall on our loan £126k, ie 37% haircut to capital on our loan
This is my reasonable guess of the outcome if the borrower doesn't get their act together and sell unit 1 in the near future and lenders are forced to close on the loan. Whether it comes to that is hard to gauge. If their updates are to be believed sale of unit 1 is imminent to one of the two buyers lined-up. I'm a bit skeptical given the time that's passed and the fact little/no progress appears to have been made on the sale or finishing unit 2 over the past 6 months. Something smells. I suspect it is the same smell that stopped LLI extending the loan. The positive is that LLI do have a good track record on recoveries on loans that have gone wrong.
I automatically completely write-off (in my mind) all loans that are greater than 3 months overdue - avoids continually trying to second guess the outcome and unnecessary stress for outcomes I can't influence.
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Post by Ace on Dec 7, 2022 17:18:34 GMT
I automatically completely write-off (in my mind) all loans that are greater than 3 months overdue - avoids continually trying to second guess the outcome and unnecessary stress for outcomes I can't influence. On that basis half of my all time profits from P2P investing would be wiped out 😳 Totally wiped out if I include a worst case scenario at ABLrate 😭
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nick
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Post by nick on Dec 7, 2022 17:42:07 GMT
I automatically completely write-off (in my mind) all loans that are greater than 3 months overdue - avoids continually trying to second guess the outcome and unnecessary stress for outcomes I can't influence. On that basis half of my all time profits from P2P investing would be wiped out 😳 Totally wiped out if I include a worst case scenario at ABLrate 😭 Yep, I feel your pain! My large ABLrate exposures are definitely something I'm trying to move on from, but I'm still struggling to accept reality
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a0010402
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Post by a0010402 on Dec 7, 2022 19:00:31 GMT
The first chart featured in today's FT article about monthly house price drops is very eloquent. Let's attach the word "transitory" to it so that we may sleep tonight - unless that word is loaded.
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agent69
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Post by agent69 on Dec 7, 2022 19:18:00 GMT
The first chart featured in today's FT article about monthly house price drops is very eloquent. Let's attach the word "transitory" to it so that we may sleep tonight - unless that word is loaded. But as the experts will always tell you, the value of your house is meaningless unless you're going to:
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Post by Ace on Dec 7, 2022 20:08:26 GMT
The first chart featured in today's FT article about monthly house price drops is very eloquent. Let's attach the word "transitory" to it so that we may sleep tonight - unless that word is loaded. But as the experts will always tell you, the value of your house is meaningless unless you're going to:
Or c. Invest in a P2P loan secured on it 😉
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agent69
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Post by agent69 on Dec 7, 2022 20:19:48 GMT
But as the experts will always tell you, the value of your house is meaningless unless you're going to:
Or c. Invest in a P2P loan secured on it 😉 I thought you would have known better.
The value of a P2P asset has nothing to do with the size of the loan secured against it.
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Post by overthehill on Dec 7, 2022 21:05:13 GMT
The first chart featured in today's FT article about monthly house price drops is very eloquent. Let's attach the word "transitory" to it so that we may sleep tonight - unless that word is loaded.
That's a lot of meaningless squiggles
"The annual rate of growth in property prices has now dropped from 8.2% to 4.7%."
HOUSE PRICES ARE STILL 4.7% HIGHER THAN 12 MONTHS AGO. Now we're getting somewhere.
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a0010402
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Post by a0010402 on Dec 15, 2022 16:26:00 GMT
LandlordInvest allows resales to be listed at a discount. Some people routinely sell their loans before maturity because for them they aren't worth as much as if they were new loans, possibly because they are more risky (and I'm not talking about sellers who sell out of necessity or for other reasons).
For this reason I no longer think that selling loans close to maturity at par without discount is going to be a good deal for the buyer in general. It's rather going to be like dumping of the additional risk from the seller onto the buyer, a risk no one has adequately, clearly, or quite openly quantified. I've come to the conclusion that buyers should abstain from buying undiscounted loans on LLI (unless per their own conscious assessment of risk they determine said loans pose no additional risk), and they should make sellers wait more to sell or start offering discounts. I'll therefore buy these on LLI no more and suggest others do the same.
The problem of course is DD on resale loans can't be done in the couple of minutes or even seconds a resale loan is on offer - LLI however offers a small number of loans, and that allows potential buyers to have done DD on loans beforehand and before any sales may turn up. By which time if they're organized they should quickly look up the loan name in their own vetted list / shortlist to see if it's worth buying or not.
Any buyer who won't do that has only got themselves to blame if things go wrong. If they aren't prepared to do DD on loans, perhaps they should be asking themselves what they're doing investing in P2P or on LLI in particular. And if they're impatient about cash drag, perhaps they ought to find an alternative means to deal with that as well.
Some may think all of this is obvious and it is trite and not worth commenting on. But I think it's not, because I'd like to have seen similar comments posted here about the LLI secondary market before I chose to buy into it. No one posted comments like that for me, but perhaps I can help others. As for sellers, I don't care - they seem to know what they're doing, they do not need my help.
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Post by overthehill on Dec 15, 2022 18:11:35 GMT
LandlordInvest allows resales to be listed at a discount. Some people routinely sell their loans before maturity because for them they aren't worth as much as if they were new loans, possibly because they are more risky (and I'm not talking about sellers who sell out of necessity or for other reasons). For this reason I no longer think that selling loans close to maturity at par without discount is going to be a good deal for the buyer in general. It's rather going to be like dumping of the additional risk from the seller onto the buyer, a risk no one has adequately, clearly, or quite openly quantified. I've come to the conclusion that buyers should abstain from buying undiscounted loans on LLI (unless per their own conscious assessment of risk they determine said loans pose no additional risk), and they should make sellers wait more to sell or start offering discounts. I'll therefore buy these on LLI no more and suggest others do the same. The problem of course is DD on resale loans can't be done in the couple of minutes or even seconds a resale loan is on offer - LLI however offers a small number of loans, and that allows potential buyers to have done DD on loans beforehand and before any sales may turn up. By which time if they're organized they should quickly look up the loan name in their own vetted list / shortlist to see if it's worth buying or not. Any buyer who won't do that has only got themselves to blame if things go wrong. If they aren't prepared to do DD on loans, perhaps they should be asking themselves what they're doing investing in P2P or on LLI in particular. And if they're impatient about cash drag, perhaps they ought to find an alternative means to deal with that as well. Some may think all of this is obvious and it is trite and not worth commenting on. But I think it's not, because I'd like to have seen similar comments posted here about the LLI secondary market before I chose to buy into it. No one posted comments like that for me, but perhaps I can help others. As for sellers, I don't care - they seem to know what they're doing, they do not need my help. Couldn't this advice be applied to every P2P platform. Not sure why you have singled out LandlordInvest?
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nick
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Post by nick on Dec 15, 2022 18:37:56 GMT
LandlordInvest allows resales to be listed at a discount. Some people routinely sell their loans before maturity because for them they aren't worth as much as if they were new loans, possibly because they are more risky (and I'm not talking about sellers who sell out of necessity or for other reasons). For this reason I no longer think that selling loans close to maturity at par without discount is going to be a good deal for the buyer in general. It's rather going to be like dumping of the additional risk from the seller onto the buyer, a risk no one has adequately, clearly, or quite openly quantified. I've come to the conclusion that buyers should abstain from buying undiscounted loans on LLI (unless per their own conscious assessment of risk they determine said loans pose no additional risk), and they should make sellers wait more to sell or start offering discounts. I'll therefore buy these on LLI no more and suggest others do the same. The problem of course is DD on resale loans can't be done in the couple of minutes or even seconds a resale loan is on offer - LLI however offers a small number of loans, and that allows potential buyers to have done DD on loans beforehand and before any sales may turn up. By which time if they're organized they should quickly look up the loan name in their own vetted list / shortlist to see if it's worth buying or not. Any buyer who won't do that has only got themselves to blame if things go wrong. If they aren't prepared to do DD on loans, perhaps they should be asking themselves what they're doing investing in P2P or on LLI in particular. And if they're impatient about cash drag, perhaps they ought to find an alternative means to deal with that as well. Some may think all of this is obvious and it is trite and not worth commenting on. But I think it's not, because I'd like to have seen similar comments posted here about the LLI secondary market before I chose to buy into it. No one posted comments like that for me, but perhaps I can help others. As for sellers, I don't care - they seem to know what they're doing, they do not need my help. Couldn't this advice be applied to every P2P platform. Not sure why you have singled out LandlordInvest?
I think it does apply to all P2P SMs. I find it ironic that most platforms do not allow loans to be sold at a premium on the basis that their fair value is likely to be par value at most. Applying this rational, the true fair value of most loans are significantly below par given the increase in rates and making an at par limit even more arbitrary. The reality is that most retail investors are over valuing the intrinsic value of loans due to retail demand exceeding supply for most higher rate/risk loans and as a result the loans would usually trade at a premium or otherwise get snapped up on SMs that limit resale at par.
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