Property Loan 20 - Repaid in full after Default

Nothing is typical about PBL020 and very little can be drawn from the valuations.  Several months before the loan a specialist agent in garden centres produced what could be called a "back of a fag packet" valuation that came to £2.4 million, conveniently enough for 70% to be the LTV.  It transpires that the garden centre was actually closed either at the time or before the SS borrower purchased it.  The land registry records the purchase price by the SS borrower as a tad under £1.5million.  Therefore the valuation significantly differed from the purchase price and it would appear to have been more or less wholly paid for by the advance pf Lendy Ltd.  The garden centre re-openend, traded for a while, the Planning Permission was denied and the borrower called in the Adminstrators (probably after consulting with Lendy Ltd).  The same agents then put the property on the maarket for £1.5 million and we have since been informed that a offer has been accepted and the agent's web site states sale agreed.  At the present time no-one has revealed the value of the offer that has been accepted.

So while you are right that this is an example of how valuations can be drastically reduced it is unlkely that the true value at the time of the SS loan was anything like £2.4million, on a somewhat cliched valuation ("something is only worth what someone will pay for it") at the time of the original loan it was more like £1.5 million, therefore the LTV in this instance was probably 112% not the 70% as quoted.

The purpose of trading the garden centre was to try and preserve its value not make a profit, somewhere amongst the Administrators proposals you can see evidence of the level of trading, it is unlikely that there will be sufficient to cover the costs of supervision let alone the Administrator's (not Receivers) general costs.

Edit The statement of affairs shows the secured credtor (Lendy Ltd) as somewhat more than the loan value (£1.7million) as £2.841million.

I think they probably will because this is under the old T&Cs but it will not set a precedent.  It will also depend on their own financial health, the latest financial information on Lendy Ltd is 20 months old, and taking the information in the statement of affairs, the asking price and probable costs they look set to take a bath of around £1.5million on this, without more up to date financial data it is impossible to know whether they can withstand it.

If SS wish to stick with the claim that "no investor has LOST money" then in theory then simply need to cover any capital loss.  Interest can be classed as a gain and providing original investment is covered then no loss will have been made.  That being said it is simply my opinion and not anything gleaned from the t&c's.

No, they didn't. They waited until the property was sold to repay, although IIRC they carried on paying monthly interest during the default period.

Yes, junk bonds and the like. But the SS platform does not allow any price adjustment for risk so would require substantial revision, and judging by the other platforms which do allow discounts it is easy to make a real pig's ear out of this facility.

Why should SS stop them? For the same reason that Banks now wish they had stopped people buying PPI insurance.

I think I read or heard somewhere that PPI were sometimes forced onto people or even sold within a package without the person even knowing that they were getting PPI. This will be different than anything on P2P platforms that I know of, including SS.