ben
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Post by ben on May 27, 2016 17:16:06 GMT
That's impossible - unless Lendy buy on the SM. There may be a financial case for SS/Lendy buying up parts of the loan, particularly if a penalty rate of interest has now kicked; which is most likely. I suspect that the reason the loan has been put into default is that the borrower's advance interest is now exhausted and they aren't currently in a position to service the loan. Especially as they will be ultimatley responsible for it. So might be better to grab some bits now so they are not left with a massive bill all at once if the asset does not sell for what expected.
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littleoldlady
Member of DD Central
Running down all platforms due to age
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Post by littleoldlady on May 27, 2016 17:23:00 GMT
That's impossible - unless Lendy buy on the SM. There may be a financial case for SS/Lendy buying up parts of the loan, particularly if a penalty rate of interest has now kicked; which is most likely. . Why would that make any difference? We have lent to Lendy at 12%. Lendy's terms with the borrower will be different but I see no advantage in them buying loan parts on the SM.
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boble
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Post by boble on May 27, 2016 17:38:40 GMT
There may be a financial case for SS/Lendy buying up parts of the loan, particularly if a penalty rate of interest has now kicked; which is most likely. . Why would that make any difference? We have lent to Lendy at 12%. Lendy's terms with the borrower will be different but I see no advantage in them buying loan parts on the SM. Should have said "kicked in". SS will have knowledge of the reason for the default and may be reasonably comfortable that it will be corrected/there is unlikely to be a loss. In this case, subject to their cash liquidity they could buy up available loan parts (which they may be struggling to do). This also looks better on the SM and also provides other investors with some confidence. I am, of course not speaking for SS and this is simply one perspective.
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Jeepers
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Post by Jeepers on May 27, 2016 17:44:01 GMT
Seems very coincidental that the new INPL rules came into effect the day before this loan is declared as being in default.
Does this mean that the PF is being used as working capital and SS don't want the gamers having a negative balance on their account because they know they may need this capital to cover any shortfall?
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spyrogyra
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Post by spyrogyra on May 27, 2016 17:54:04 GMT
The latest purchases show different investors buying in the investors activity tab. I don't think SS would use such tricks.Though it is possible that they are buying parts without showing them in the tab.
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nick
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Post by nick on May 27, 2016 18:03:52 GMT
It's not clear who is funding the INPL deficit balances. I suspect the transactions are only posted as client account allocation entries and that individual account deficits are effectively funded by other individual's surplus' within the client money account, i.e. the deficit is not funded by transfer of hard cash by SS into the client money account. If this is the case, we are all collectively exposed to the deficits run up others at any given point of time. Stockbrokers used to do this when giving clients credit for transactions that took a couple of days to clear in the market until the FSA tightened up client money rules such that any credit must be covered by transfers or existing deposits made by the broker into the client account at all times.
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on May 27, 2016 18:12:22 GMT
Seems very coincidental that the new INPL rules came into effect the day before this loan is declared as being in default. Does this mean that the PF is being used as working capital and SS don't want the gamers having a negative balance on their account because they know they may need this capital to cover any shortfall? Hopefully not, but fact that PF company accounts appear to be 3 months overdue is a concern
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Post by Deleted on May 27, 2016 19:01:36 GMT
This is a very interesting case to watch even for those, like me, not invested in the loan.
It is the very first default for a loan with a substantial amount and its LTV is at 70%.
Lendy appointed two very experienced legal outfits to maximase returns.
Interesting to see how much they will be able to recover from the sale.
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MarkT
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Post by MarkT on May 27, 2016 19:21:04 GMT
As new investor, of nearly a week now, I too am really interested in this.
For me, this really is the test of how resilient this model is to defaults and will inform how much I will invest in the future.
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Post by pepperpot on May 27, 2016 19:49:02 GMT
I'm eager to see if I get my 1p back.  As long as there is at least a 51% recovery, rounding should see you flush again. I wouldn't hold out too much hope for any interest though.
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Post by soozp2p on May 27, 2016 20:03:46 GMT
I shall watch with interest, but having been tipped off by my partner, with a lot of willing buyers, and something to spend the money on tomorrow, I shall watch without a direct financial interest.  |
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Post by GSV3MIaC on May 27, 2016 20:13:21 GMT
As new investor, of nearly a week now, I too am really interested in this. For me, this really is the test of how resilient this model is to defaults and will inform how much I will invest in the future. /mod hat off, PBL020 investor (for sale!) on .. Well it's a test, but I don't think you/we will be able to draw too many conclusions from one sample, and one under the old T&Cs at that. This is the big risk with a bridging loan .. 'bridge to nowhere' if the borrower can't refinance / sell at the other end, and it is likely to happen 'quite often' (whatever that means). The interest keeps mounting, and the exit gets further away. That's the point at which it really rather matters whether the initial valuation was accurate, still holds, and can be achieved in non-geological time .. and the answer to those is likely to be different for every single loan. There is, of course, the further (and untested) backstop of the provision fund .. hopefully this one won't test that.
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on May 27, 2016 20:22:13 GMT
moist; you are new here, but you must learn the rules  You link names & shames, so you should probably delete before you get in trouble with the MODs...
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MarkT
Member of DD Central
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Post by MarkT on May 27, 2016 20:27:55 GMT
As new investor, of nearly a week now, I too am really interested in this. For me, this really is the test of how resilient this model is to defaults and will inform how much I will invest in the future. /mod hat off, PBL020 investor (for sale!) on .. Well it's a test, but I don't think you/we will be able to draw too many conclusions from one sample, and one under the old T&Cs at that. This is the big risk with a bridging loan .. 'bridge to nowhere' if the borrower can't refinance / sell at the other end, and it is likely to happen 'quite often' (whatever that means). The interest keeps mounting, and the exit gets further away. That's the point at which it really rather matters whether the initial valuation was accurate, still holds, and can be achieved in non-geological time .. and the answer to those is likely to be different for every single loan. There is, of course, the further (and untested) backstop of the provision fund .. hopefully this one won't test that. You're absolutely right. It tests whether the valuation is a realistic one and a sample size of one isn't necessarily representative. I believe there has been one default previously, did everyone get their money back?
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Post by GSV3MIaC on May 27, 2016 20:30:00 GMT
Yes, they did.
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