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Post by Badly Drawn Stickman on Oct 21, 2020 19:21:35 GMT
It was paid as part of an underwriting deal on the loan. I appreciate you may not wish to say, but (and I know its a lot of assuming) does this indicate that the whole loan is underwritten and consequently the protracted time to draw down on 142 will not be repeated and the loan will close on the given date. I would have expected at least most of the amount of the repaid loan to have been pledged by now, I wonder if there is concern over another lengthy duration. Oddly I like a decent period of instant returns myself. Maybe improve one thing on the LE for yes and two for no.
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Post by ladywhitenap on Oct 21, 2020 20:33:59 GMT
I read somewhere that at the end of the offer period the rest of the loan will be under written. So it seems Abl simply brought forward enough of that underwriting committment to clear the previous loan with a good chance that we would be putting a fair proportion straight back in.
LW
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Post by Badly Drawn Stickman on Oct 22, 2020 9:33:02 GMT
I read somewhere that at the end of the offer period the rest of the loan will be under written. So it seems Abl simply brought forward enough of that underwriting committment to clear the previous loan with a good chance that we would be putting a fair proportion straight back in. LW Unusually short listing period on the details, presumably started at 12 days, presumably the two are linked in some way.
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criston
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Post by criston on Oct 23, 2020 15:15:10 GMT
I note the loan has a minimum of £850k with less than 2 weeks to fill.
100% loss at 33% LTV
Tranche 1 loss starts at 44% LTV
Total loan to be £2m, giving 55% LTV, which will never actually be reached unless remaining tranches are filled immediately, due to tranche 1 amortisation.
Amortising of all tranches will reduce LTV by 1.4% every 3 months, or 5.5% after a year.
75% interest compounded, after 4 years assuming reinvestment at PAR.
What is there to dislike with this loan ?
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Post by Ace on Oct 23, 2020 16:12:33 GMT
I note the loan has a minimum of £850k with less than 2 weeks to fill. 100% loss at 33% LTV Tranche 1 loss starts at 44% LTV Total loan to be £2m, giving 55% LTV, which will never actually be reached unless remaining tranches are filled immediately, due to tranche 1 amortisation. Amortising of all tranches will reduce LTV by 1.4% every 3 months, or 5.5% after a year. 75% interest compounded, after 4 years assuming reinvestment at PAR. What is there to dislike with this loan ? What do you mean by "100% loss at 33% LTV"? It's actually 81.5% total return if you could reinvest interest and capital at par as it actually pays 1.25% per month rather than 15% per year, so 1.0125 to the power 48 = 1.815... There's always plenty to dislike on development loans. Too many risks to list, but AF does have an exceptionally good record of repaying his debts so I'm in.
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criston
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Post by criston on Oct 23, 2020 16:24:01 GMT
I note the loan has a minimum of £850k with less than 2 weeks to fill. 100% loss at 33% LTV Tranche 1 loss starts at 44% LTV Total loan to be £2m, giving 55% LTV, which will never actually be reached unless remaining tranches are filled immediately, due to tranche 1 amortisation. Amortising of all tranches will reduce LTV by 1.4% every 3 months, or 5.5% after a year. 75% interest compounded, after 4 years assuming reinvestment at PAR. What is there to dislike with this loan ? What do you mean by "100% loss at 33% LTV"? It's actually 81.5% total return if you could reinvest interest and capital at par as it actually pays 1.25% per month rather than 15% per year, so 1.0125 to the power 48 = 1.815... There's always plenty to dislike on development loans. Too many risks to list, but AF does have an exceptionally good record of repaying his debts so I'm in. £3m Ist Charge. 33% of £9m security value. In the event of default & the land proceeds only realised £3m, there would be a 100% loss to Ablrate lenders. I did 1.15x1.15x1.15x1.15=75% for compounding. You are right though, compounding monthly instead of annually. Have I misread it, I thought this was a loan against the land value, not the development ?
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Post by Ace on Oct 23, 2020 16:46:10 GMT
£3m Ist Charge. 33% of £9m security value. In the event of default & the land proceeds only realised £3m, there would be a 100% loss to Ablrate lenders. Ah, OK I see now. Thanks. That would be correct if it paid 15% at the end of each year, but it doesn't. It pays 15/12% at the end of each month. So, instead of 1.15 to the power 4, you need to do 1.0125 to the power 48. Yes, that's the initial security, but the land is being developed. There's a clue in the title . And the headline description states with: "Financing of up to £2m is now sought to assist with the development of the site and refinancing of existing liabilities."
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criston
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Post by criston on Oct 23, 2020 17:06:25 GMT
£3m Ist Charge. 33% of £9m security value. In the event of default & the land proceeds only realised £3m, there would be a 100% loss to Ablrate lenders. Ah, OK I see now. Thanks. That would be correct if it payed 15% at the end of each year, but it doesn't. It pays 15/12% at the end of each month. So, instead of 1.15 to the power 4, you need to do 1.0125 to the power 48. Yes, that's the initial security, but the land is being developed. There's a clue in the title . And the headline description states with: "Financing of up to £2m is now sought to assist with the development of the site and refinancing of existing liabilities." I had edited my post, saying you were correct. Our security is the land, even though the funds are being used for something different.
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criston
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Post by criston on Nov 5, 2020 15:44:56 GMT
Ablrate.
To be able to assess the ongoing LTV as payments are made, could you please provide the following information.
Is the £3.5m first charge loan amortising & if so over what period.
Will all Ablrate tranches rank equally behind the first charge.
Please advise.
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blender
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Post by blender on Dec 23, 2020 11:40:01 GMT
151, just listed, is simply a £250k extension of 149 pari passu as expected, and so this is the relevant thread, presumably. With a couple of hours to start of bids existing holders of 149 are not selling at par or below - which is good for the prospects of 151. Might as well take 149 or 151 - whichever has the best offer.
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criston
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Post by criston on Dec 23, 2020 12:27:10 GMT
149 is the better bet, as it was never quite clear future tranches would rank equally.
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blender
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Post by blender on Dec 23, 2020 13:04:03 GMT
149 is the better bet, as it was never quite clear future tranches would rank equally. With respect that is not the case. It is stated on page 3 of the borrowing proposal for 151 that the Ablrate tranches will share the same security pari-passu and so 149 and 151 are equal. I did not study all of 149, not having the cash then, but the fact that 149 was the first in a number of tranches to £2M which would share security is clearly stated. Pari passu is the only practical method - as was used by FC for its property loans, of beloved memory. 151 will dilute the security of 149, but only to the extent advertised.
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criston
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Post by criston on Dec 23, 2020 13:15:33 GMT
149 is the better bet, as it was never quite clear future tranches would rank equally. With respect that is not the case. It is stated on page 3 of the borrowing proposal for 151 that the Ablrate tranches will share the same security pari-passu and so 149 and 151 are equal. I did not study all of 149, not having the cash then, but the fact that 149 was the first in a number of tranches to £2M which would share security is clearly stated. Pari passu is the only practical method - as was used by FC for its property loans, of beloved memory. 151 will dilute the security of 149, but only to the extent advertised. Unless 149 borrowing proposal has changed, there was not any mention of tranches ranking equally. The implication may have been there, but it was not explicit. That is why I asked the question in this thread, without an answer. The terms cannot now be changed retrospectively.
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blender
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Post by blender on Dec 23, 2020 14:18:32 GMT
They never change historical proposals - just add addenda. It is difficult to argue that something was not stated but has now been changed, or must not be changed. It is obvious that the tranches would be pari passu, though it should have been stated. How else could you add a tranche at any sensible interest rate? However, if any comfort, the pari passu must be limited £2M through Ablrate, including any underwriting, IMO. If a question here is not answered and is important, I think it is best to raise formally through customer services. This is not a formal channel.
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criston
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Post by criston on Dec 23, 2020 14:27:31 GMT
They never change historical proposals - just add addenda. It is difficult to argue that something was not stated but has now been changed, or must not be changed. It is obvious that the tranches would be pari passu, though it should have been stated. How else could you add a tranche at any sensible interest rate? However, if any comfort, the pari passu must be limited £2M through Ablrate, including any underwriting, IMO. If a question here is not answered and is important, I think it is best to raise formally through customer services. This is not a formal channel. It could be because the question here & the new loans thread, that the phrasing has changed in loan 151. It would have also been helpful if they could have answered if the eventual new or old 1st Charge, is amortising as well.
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