cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Feb 28, 2017 17:43:35 GMT
It's (almost) all in the email that was sent an hour or so ago. "The accrued interest to date will be included in the end of the month interest payments. " "it was sold for £1.3m, with the difference in capital made up by our Provision Fund." Thanks. I didn't get the email. (Perhaps the matter was important enough to have justified sending the email to all SS investors, for their information?). So the security was valued at £2.43 million in Dec 2014 and the loan of £1.7m had a claimed LTV ratio of 70%. It sold in early 2017 for £1.3 million. Therefore the actual LTV ratio has turned out to be 131%. (This ignores changes in value between the respective dates and the distressed sale situation). Also worth noting that the borrower paid £1,475,000 for the Garden Centre, so the LTPV was 115% - The purchase value should always be disclosed to investors, in this case, it wasn't. If you work out the actual loan, it does seem that this was a 100% loan, with no collateral coming via the borrower at all. I wonder if we will ever find out what the deal was with Lendy having a 10% share in the failed business (i.e. the borrower)... I guess not In any case, a satisfactory result for all involved; good to see that nobody lost any money, but I hope investors don;t see it as a precedent. This was on the old T&Cs and the PF is still discretionary I'm happy to say I have got my 1p back... I look forward to getting my interest paid in full tomorrow 
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Post by dualinvestor on Feb 28, 2017 17:54:43 GMT
It's (almost) all in the email that was sent an hour or so ago. .................. Thanks. I didn't get the email. (Perhaps the matter was important enough to have justified sending the email to all SS investors, for their information?). So the security was valued at £2.43 million in Dec 2014 and the loan of £1.7m had a claimed LTV ratio of 70%. It sold in early 2017 for £1.3 million. Therefore the actual LTV ratio has turned out to be 131%. (This ignores changes in value between the respective dates and the distressed sale situation). The situation is a great deal murkier thsn suggested by the email. "it was sold for £1.3m" what was? The freehold? The freehold plus fixtures and fittings? Plus stock? Plus goodwill? "Lendy Ltd advanced £1,700,000 of Saving Stream investors funding" The Administrtors say Lendy Ltd was owed £2.841million at 26 May 2016. "lenders have collectively earned over £170,000 in interest on this loan, based on the gross annual return of 12%." Have they? They probably did from loan drawdown to default, but what about the last nine months? There is indeed a valuation showing £2.43 million, but there is also a subsequent Land Registry entry showin the borrower as purchaser for £1.5million at the time of the loan. Lendy Ltd (actually Lendy Finance one of their trading names) is a 10% shareholder of the borrower according to the latters last Annual Return.
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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 Feb 28, 2017 18:37:14 GMT
So whats the financial cost to the provision fund ? Loan of 1.7m , sold for 1.3m so that's 400k for starters. Cost of receivers and selling ? Any suggestions ? 50k ?? When did the garden centre stop paying interest ? 6 months ago ? If so, that's 102 k interest (ie. 12% for 6 months on 1.7m). So total cost to PF = 400 + 50 + 102 = 552 k ?? But I've almost certainly missed something and am really only guessing anyway  . Anyone able to approximate better ? 400k as according to the email PF made good on capital only Receivers costs well over 200k but SS negotiated a cap at 50k, plus another £110k for legals, agents, security, insurance etc so £560k hit (wont know for sure until final admin report) Stopped paying interest 27/5, so 9 months but SS seem to have covered that. More important is probably the hit taken by the platform even with their Universe dominating profitability.
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twoheads
Member of DD Central
Programming
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Post by twoheads on Feb 28, 2017 18:39:42 GMT
I'm not sure that anybody will come out of this feeling smug. Even if the interest is repaid in full there has been 9 months of interest that has not been compounded. So everybody loses. Blimey... when did your glass become half empty?
The calculation of locutus is accurate; the investors have lost almost nothing other than sleep and hair (which locutus ' avatar lacks anyway).
The financial losers are SS/Lendy. However, the shot in the arm which this 'positive' result will give them will quickly turn the negatives back to positives.
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toffeeboy
Member of DD Central
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Post by toffeeboy on Feb 28, 2017 18:55:28 GMT
If interest at 12% is paid tomorrow with the normal interest run there will quite a few people here with egg on their faces and they will have turned out to have been the mugs for doubting SS - and the people who carried on buying into this loan after it defaulted (and when the SM was dry) will be feeling very smug. SS can continue advertising that no investor has lost a penny. My only concern is that this could lull investors into a false sense of security and might encourage others to put money into defaulted loans. I sold out of this one long before it defaulted but I'm very pleased that the 1,000 or so people whon were still in it have got their money back. Not only is that great news for them, it's great news for all of us because it maintains confidence in the platform. I will be very interested to find out how much the garden centre sold for and how much SS were able to recover. To be fair I think that most people have been asking SS for clarification on what was going to be paid rather than actually doubting SS, do we actually know if all of the accrued interest is going to be paid yet for this loan. I wasn't involved in this even for a penny so didn't get the email. I know there were a few doubting SS but most were complaining about the lack of communication of the what was going to happen when the sale of the asset fell short of the capital outstanding.
As you say SS can continue to say that no investor has lost a penny investing through the site but then I think they had to cover this loan because it was made under the old T&C's which makes a big difference with the loan being to Lendy not the borrower.
As you say it is great news that all of the investors have at least got their capital repaid but a shame that it has had to come at a cost to SS but hopefully they learnt a lot from this loan and have tightened up a lot of the holes.
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sg
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Post by sg on Feb 28, 2017 19:02:24 GMT
Ok, ok. I confess I didn't do the maths, the compound is tiny, I humbly apologise, I'm not your ex-wife, but I'm probably guilty of much else, for which I also apologise humbly.
I was just trying to point out, in my bumbling way, that there was no reason for anybody to be smug about this result, at best it was an escape from which many lessons can be drawn.
Also, without wishing to offend, I would like to point out that there was much about the SS handling of this default that does not look good, for me the most dubious being unilaterally and retrospectively changing the handling of defaults two weeks before defaulting this loan.
I apologise in advance for any offence caused by pointing that out.
Sorry.
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ozboy
Member of DD Central
Mine's a Large One! (Snigger, snigger .......)
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Post by ozboy on Feb 28, 2017 19:11:08 GMT
You seem a nice geezer sg, or maybe you're a geezerette?? Either way, don't beat yourself up, as I'm sure you're not. |
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sg
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Post by sg on Feb 28, 2017 19:32:03 GMT
ozboy - grumpy old codger according to the wife.
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ben
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Post by ben on Feb 28, 2017 19:34:30 GMT
Is the interest being paid on this? or has it be capped at return of capital only?
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stevio
Member of DD Central
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Post by stevio on Feb 28, 2017 19:49:02 GMT
Is it possible to post the email (anonymised) - I didn't get the email either, but would be interested in the content
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vmail
Open image in a new tab.
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Post by vmail on Feb 28, 2017 19:55:10 GMT
To be replaced with PBL037*, PBL038*, PBL039*, PBL046*, PBL047*, PBL056*, PBL069*, PBL070*, PBL071*, PBL074, PBL075, and PBL081
* indicates soon
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Feb 28, 2017 20:06:37 GMT
Is it possible to post the email (anonymised) - I didn't get the email either, but would be interested in the content Dear Terminator, We would like to announce the full repayment of the above loan. All investors should now have their capital credited to their Saving Stream accounts. The accrued interest to date will be included in the end of the month interest payments. In December 2014, Lendy Ltd advanced £1,700,000 of Saving Stream investors funding in bridging finance to E** W****** R****** L**, to fund the A****** G***** C***** project. When sale negotiations fell through nine months ago, the loan went into default. Since then Lendy Ltd and our appointed agents have been working closely with the borrower to effect a satisfactory outcome. We are pleased to confirm that today the matter concluded with the successful sale. While the project did not meet its original sale objective, it was sold for £1.3m, with the difference in capital made up by our Provision Fund. As a result none of the 1,156 lenders in this loan will lose any capital. Over the past two years, lenders have collectively earned over £170,000 in interest on this loan, based on the gross annual return of 12%. Our auditors have conducted a thorough review of this loan and are satisfied that Lendy Ltd advanced the loan on a sound commercial basis and that our underwriting and due diligence were conducted in a stringent and thorough way. Users of the Lendy platform can be assured that Lendy takes a responsible approach to lending, and will always take every possible precaution to prevent a loan defaulting. Kind regards, The Saving Stream Team
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stevio
Member of DD Central
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Post by stevio on Feb 28, 2017 20:16:30 GMT
To be replaced with PBL037*, PBL038*, PBL039*, PBL046*, PBL047*, PBL056*, PBL069*, PBL070*, PBL071*, PBL074, PBL075, and PBL081 * indicates soon I'm not the only pessimist  (thinking its convenient the default is cleared just before they start the new rules)
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Liz
Member of DD Central
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Post by Liz on Feb 28, 2017 20:17:05 GMT
From the default page:
"These are loans where we are no longer confident about the borrowers ability to repay the loan and have therefore officially defaulted the loan. Monthly interest payments are not guaranteed. We are taking all appropriate steps to recover 100% of the capital from these loans."
Don't expect interest to be paid with loans under the new T&C's
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ben
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Post by ben on Feb 28, 2017 20:22:48 GMT
That is going to have cost SS a fair penny when you add it all up, but not worry there auditors are happy so it is all good.
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(thinking its convenient the default is cleared just before they start the new rules)