criston
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Post by criston on Aug 12, 2020 15:39:58 GMT
Am I allowed to post this here ? Don't see why not - doesn't identify the asset (although you may wish to obfuscate the road name as it could be tied back via land registry on the sale amount). (Edit: taken care of I see ) Very useful. All other things being equal goes to show the costs associated with property disposals and maybe why 35% headroom on a £120k property's LTV isn't necessarily more attractive than 20% headroom on on that of a £1.2m property. Those costs which aren't fixed (by £-value or %) can be proportionally way more on a low cost property and really bite into the capital returns. Edited by moderator before I got there.
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adrian77
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Post by adrian77 on Aug 12, 2020 16:13:38 GMT
totally agree this seems crazy to me - this chap borrowed our money , he defaults and then he gets a £12K bonus for doing so whilst the investors don't get their full interest repaid - you could not make this up
On the plus side glad this one went better than a lot of others and still a good profit albeit a reduced one.
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criston
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Post by criston on Aug 12, 2020 16:31:24 GMT
I smell a rat.
These were the updates.
25/06/2020
Further to the update provided yesterday, we have been notified that the land was sold at auction on 24 June 2020 at £350,000, which is in line with the valuation obtained by the appointed receivers. Completion is confirmed for 7 July 2020. The sellers existing solicitors have effected the exchange and hold the deposit, which has been agreed with the receivers. It should however be noted, that the transaction through to completion, remains strictly under the remit of the receivers, and the net sale proceeds will be remitted to the receivers’ instructed solicitors following completion.
A further update providing a breakdown of the sale proceeds will be provided upon receipt of the same.
A further update providing a breakdown of the sale proceeds will be provided upon receipt of the same.
24/06/2020
Receivers have been appointed and we await their initial report and recommendations.
I understand the borrower auctioned the land themselves.
I informed the administrators after the 24/6/20 update appeared, that the property had already been sold on 24/6/20 several hours before the note on 24/6/20 appeared (supposedly they were not aware it had been sold)
The note on 25/6/20 appeared the following day.
Yet receivers receive money.
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arby
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Post by arby on Aug 12, 2020 20:03:27 GMT
totally agree this seems crazy to me - this chap borrowed our money , he defaults and then he gets a £12K bonus for doing so whilst the investors don't get their full interest repaid - you could not make this up On the plus side glad this one went better than a lot of others and still a good profit albeit a reduced one. Who should pay for recovery costs if the arranging company goes under? Should the lenders pay more, or is the borrowers that should bear the burden? As it's the lenders that have the incentive to see the operation continue to function then of course it is us that have to pay additional fees. As much as I want to see dishonest borrowers strung up, I don't see why they (the honest ones) should have to pay more than was agreed to redeem their loan as I'm sure they'd be quite happy for no recovery effort to be made. In this case, they paid all they were obliged to do, with a small surplus returned to them. It's our administrator that has taken their cut from our interest and has nothing to do with the borrower.
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sqh
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Before P2P, savers put a guinea in a piggy bank, now they smash the banks to become guinea pigs.
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Post by sqh on Aug 12, 2020 20:19:15 GMT
I think the administrators have made a simple mistake and didn't calculate interest correctly. Perhaps they thought we had already received 6 months interest on 1/10/19 when the borrower made a payment to extend the loan. Of course FS didn't extend the loan and didn't pay lenders 6 months interest. I suggest sending an email to fundingsecure@cg-recovery.com requesting the full amount of interest.
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criston
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Post by criston on Aug 12, 2020 20:29:47 GMT
I think the administrators have made a simple mistake and didn't calculate interest correctly. Perhaps they thought we had already received 6 months interest on 1/10/19 when the borrower made a payment to extend the loan. Of course FS didn't extend the loan and didn't pay lenders 6 months interest. I suggest sending an email to fundingsecure@cg-recovery.com requesting the full amount of interest. Anything that helps, but if a mistake has been made, why do the closing figures state that the actual interest paid is 8.6% pa, over the 499 day period.
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Post by multiaccountmanager on Aug 12, 2020 20:51:33 GMT
I think the administrators have made a simple mistake and didn't calculate interest correctly. Perhaps they thought we had already received 6 months interest on 1/10/19 when the borrower made a payment to extend the loan. Of course FS didn't extend the loan and didn't pay lenders 6 months interest. I suggest sending an email to fundingsecure@cg-recovery.com requesting the full amount of interest. Anything that helps, but if a mistake has been made, why do the closing figures state that the actual interest paid is 8.6% pa, over the 499 day period. For heaven's sake. Are these people qualified? Sacking offence to make a public mistake of this nature, if that is what it is.
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criston
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Post by criston on Aug 12, 2020 21:55:10 GMT
totally agree this seems crazy to me - this chap borrowed our money , he defaults and then he gets a £12K bonus for doing so whilst the investors don't get their full interest repaid - you could not make this up On the plus side glad this one went better than a lot of others and still a good profit albeit a reduced one. Who should pay for recovery costs if the arranging company goes under? Should the lenders pay more, or is the borrowers that should bear the burden? As it's the lenders that have the incentive to see the operation continue to function then of course it is us that have to pay additional fees. As much as I want to see dishonest borrowers strung up, I don't see why they (the honest ones) should have to pay more than was agreed to redeem their loan as I'm sure they'd be quite happy for no recovery effort to be made. In this case, they paid all they were obliged to do, with a small surplus returned to them. It's our administrator that has taken their cut from You appear to know what you are talking about. You appear to know what you are talking about. Please explain why lenders are not entitled to full interest, when the funds are available.
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arby
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Post by arby on Aug 13, 2020 5:51:59 GMT
Who should pay for recovery costs if the arranging company goes under? Should the lenders pay more, or is the borrowers that should bear the burden? As it's the lenders that have the incentive to see the operation continue to function then of course it is us that have to pay additional fees. As much as I want to see dishonest borrowers strung up, I don't see why they (the honest ones) should have to pay more than was agreed to redeem their loan as I'm sure they'd be quite happy for no recovery effort to be made. In this case, they paid all they were obliged to do, with a small surplus returned to them. It's our administrator that has taken their cut from You appear to know what you are talking about. You appear to know what you are talking about. Please explain why lenders are not entitled to full interest, when the funds are available. The administrators have to be paid for and that is not the responsibility of the borrower. It is between us and FS as to who provides whatever funds are necessary and unfortunately the deal we accepted (although there was no alternative option so not much of an acceptance) was that we would accept reduced interest to pay for the administrator.
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criston
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Post by criston on Aug 13, 2020 7:35:43 GMT
You appear to know what you are talking about. Please explain why lenders are not entitled to full interest, when the funds are available. The administrators have to be paid for and that is not the responsibility of the borrower. It is between us and FS as to who provides whatever funds are necessary and unfortunately the deal we accepted (although there was no alternative option so not much of an acceptance) was that we would accept reduced interest to pay for the administrator. The administrators & all other leaches have been paid in full out of the proceeds. Lenders were paid around £12000 less than the full amount of interest owing. The borrower was paid the so called surplus of £12854. This is what I am asking you to explain.
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adrian77
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Post by adrian77 on Aug 13, 2020 8:31:59 GMT
damn good question !
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ilmoro
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Post by ilmoro on Aug 13, 2020 8:38:52 GMT
The administrators have to be paid for and that is not the responsibility of the borrower. It is between us and FS as to who provides whatever funds are necessary and unfortunately the deal we accepted (although there was no alternative option so not much of an acceptance) was that we would accept reduced interest to pay for the administrator. The administrators & all other leaches have been paid in full out of the proceeds. Lenders were paid around £12000 less than the full amount of interest owing. The borrower was paid the so called surplus of £12854. This is what I am asking you to explain. The borrower repaid lenders in full. The lenders then, under a separate contract to which the borrower is not a party & has no obligations under, then paid CG. Its nothing to do with the borrower that FS are in administration so they have no duty to pay for CG to operate the platform. Perhaps if the figures were in a different order it would be clearer. Sale Proceeds: £ 350,000.00 Funds withheld held at start of loan £ 25,235.55 Total Received £ 375,235.55 Less;: Estate Agents Fees (1.5% of sale price - £ 6,300.00 Agents - Marketing, Admin & Entry Fee - £ 300.00 Conveyancing Costs. and Disbursements - £ 2,185.80 Litigation Costs - £ 10,360.60 Receivers' fees & Disbursements - £ 15,250.00 Pre-Recovery costs (Site Inspection) - £90.00 Total Costs - £ 25,486.40 Net Receipts £349,149.15 -------------------------------- FS Monthly Accrued Admin Fees £ 21,894.74 Default interest due £14,104.11 Investors Capital £ 260,000.00 Investors interest £ 40896.1 (Im ignoring for the moment any questions over whether interest calculated correctly) ----------------------------------- Surplus Monies to Borrower £12.854.19 ----------------------------------- Gross return to lenders £300,896.1 CG Fees 2.5 + VAT £ 10,492..47 Net return to lenders £290,403.63 If a courier delivers you something and you then tip the courier, you wouldnt expect to claim the tip from the sender.
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Post by multiaccountmanager on Aug 13, 2020 11:44:28 GMT
The administrators & all other leaches have been paid in full out of the proceeds. Lenders were paid around £12000 less than the full amount of interest owing. The borrower was paid the so called surplus of £12854. This is what I am asking you to explain. The borrower repaid lenders in full. The lenders then, under a separate contract to which the borrower is not a party & has no obligations under, then paid CG. Its nothing to do with the borrower that FS are in administration so they have no duty to pay for CG to operate the platform. Perhaps if the figures were in a different order it would be clearer. Sale Proceeds: £ 350,000.00 Funds withheld held at start of loan £ 25,235.55 Total Received £ 375,235.55 Less;: Estate Agents Fees (1.5% of sale price - £ 6,300.00 Agents - Marketing, Admin & Entry Fee - £ 300.00 Conveyancing Costs. and Disbursements - £ 2,185.80 Litigation Costs - £ 10,360.60 Receivers' fees & Disbursements - £ 15,250.00 Pre-Recovery costs (Site Inspection) - £90.00 Total Costs - £ 25,486.40 Net Receipts £349,149.15 -------------------------------- FS Monthly Accrued Admin Fees £ 21,894.74 Default interest due £14,104.11 Investors Capital £ 260,000.00 Investors interest £ 40,896.1 (I'm ignoring for the moment any questions over whether interest calculated correctly)----------------------------------- Surplus Monies to Borrower £12.854.19 ----------------------------------- Gross return to lenders £300,896.1 CG Fees 2.5 + VAT £ 10,492..47 Net return to lenders £290,403.63 If a courier delivers you something and you then tip the courier, you wouldn't expect to claim the tip from the sender. I think all we need to focus on at the moment is whether the interest has been calculated correctly. 40,896.1 on my non expert calculations based on 260,000 loan 12% interest and 499 days is not quite right. I make that 11.5%. The difference is about £1,758. Not earth shattering but should be corrected in our favour (if my figures are right) There seem to be two other points. Firstly the fact that the 2.5%+VAT is coming from the lenders. That point is well covered in other places and seems may be subject to litigation. The amount is £10,942 Secondly the fact that the 2.5%+VAT is coming from the lenders even though there are surplus funds going to the borrower. £12,854It seems to me bizarre that the borrower can default(he failed to refinance or repay on time) yet his surplus ranks ahead of recovery costs. Can anyone explain the basis in law for that? Thank you EDIT I suppose the argument is that the CG fees etc are not recovery costs from the borrowers' point of view. However if the borrower had repaid on time, those costs would not have been incurred on this loan. It seems to me there might be a legal argument in our favour, depending on the detail of all the documents.
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Post by multiaccountmanager on Aug 13, 2020 12:12:37 GMT
What don't understand is that CG fees where taken from our payments rather than from the money returned to the lender ?? surely we should have got full payment plus full interest (plus penalty interest as not sure who that goes to) and then CG take their fees and then the borrower gets what's left ?? I'd tend to agree with you but, as has been outlined elsewhere, it's possible the borrower has a contract which sets out the deductions in the circumstances of a disposal. It's possible that FS' five percent is stipulated, but as CG&Co's 2.5% + VAT has (annoyingly) been agreed outside of that 5%, then rather than CG&Co deducting it from the borrowers returns - who would object and cause CG&Co grief - CG&Co have pragmatically taken it from lenders' returns who can't really say much, other than formally challenge the whole process. It's been suggested that the Adminsitrators action in this regard might be taken as an indicator that their 2.5%+VAT should be deducted from FS' 5%. I suspect it will take a court to decide. I am not sure that the 5% comes in to this one. It seems the borrower arranged the auction so no 5% is due apparently according to the lenders T and C's April 2017
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criston
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Post by criston on Aug 13, 2020 12:19:44 GMT
Not forgetting receivers were appointed after the property was sold, but still got a payout
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