KoR_Wraith
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Post by KoR_Wraith on Sept 1, 2021 10:38:48 GMT
£850k GDV provided in the valuation report but with next to zero information as to how this number was decided upon?
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criston
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Post by criston on Sept 1, 2021 10:40:50 GMT
Only time for a quick read, may have missed it.
Initial value £350k.
Ablrate loan £450k.
Does it say anywhere that funds are handed over in tranches.
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KoR_Wraith
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Post by KoR_Wraith on Sept 1, 2021 10:46:41 GMT
Only time for a quick read, may have missed it. Initial value £350k. Ablrate loan £450k. Does it say anywhere that funds are handed over in tranches. Given purchase price is £350k and £100k is needed for renovation works on a very short time scale I'd expect the full amount to be given in a lump sum. I'm still struggling with the GDV - not a single house on that street has sold for over £400k. Presumably the hugely increased GDV is dependent on the charity bank/housing authority refinance stuff but nowhere is this explained in any detail.
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Post by brummiefred on Sept 1, 2021 11:10:33 GMT
Once completed, the property is expected to reach £850,000 in value. The value is based upon a
combination of rental yield, uplift in property specifications and a government-backed lease for housing association tenants.
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blender
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Post by blender on Sept 1, 2021 11:23:14 GMT
I'm very pleased to be proved wrong about Ablrate's fee. The reduced risk has been reflected in the fees, which are £1500 up front and .167% pm - or 2% pa compared with lenders' 9%. So their total fees should be £6,500 if all goes to plan.
Not much scope to pay for valuations etc. out of that. Nor much need?
Also a socially useful project.
So, I'm impressed with Ablrate's approach to this new venture and not inclined to pick holes.
Now, how about getting those late repayments made, so we can lend on this.
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criston
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Post by criston on Sept 1, 2021 11:25:17 GMT
Once completed, the property is expected to reach £850,000 in value. The value is based upon a combination of rental yield, uplift in property specifications and a government-backed lease for housing association tenants. That's KoR_Wraith point. No details of how it was arrived at.
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ilmoro
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'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 Sept 1, 2021 11:26:04 GMT
Only time for a quick read, may have missed it. Initial value £350k. Ablrate loan £450k. Does it say anywhere that funds are handed over in tranches. Given purchase price is £350k and £100k is needed for renovation works on a very short time scale I'd expect the full amount to be given in a lump sum. I'm still struggling with the GDV - not a single house on that street has sold for over £400k. Presumably the hugely increased GDV is dependent on the charity bank/housing authority refinance stuff but nowhere is this explained in any detail. can you provide the full valuation report as the one currently uploaded doesnt appear to comply with RICS standards. It provides a valuation on the basis of assumptions that are not stated. Where are the comparisons?
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criston
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Post by criston on Sept 1, 2021 11:28:27 GMT
£850k GDV provided in the valuation report but with next to zero information as to how this number was decided upon? That's how FundingSecure did it. !
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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 Sept 1, 2021 11:43:24 GMT
Hmm in the light of the recent dear CEO letter how does the proposal compare the COBS 18.12.26?
Information: P2P agreements where the lender selects the agreements
COBS 18.12.26R 09/12/2019
Where a lender has the choice to enter into specific P2P agreements, a firm must provide the lender with at least the following information about each P2P agreement:
1) price of the agreement - well its there but presented in a fragmented way so lenders have to do the maths
2) annual % rate - no, as above
3) maturity date - no, but will be dependent on drawdown and term is given
4) payment frequency - yes
5) repayment amounts - no (will appear post drawdown)
6) total amount payable - no
7) description of likely return, reflecting default rate etc - no
8)risk assessment, credit worthiness etc - yes
9) asset - yes though valuation is unhelpful
10) fees - yes (perhaps this covers 1/2)
11) risk categorisation in relation to risk framework - no
12) - NA
Still looks like a reasonable proposition given the nature of the proposal and the supporting lenders record
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p2pfan
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Post by p2pfan on Sept 1, 2021 11:51:39 GMT
Only time for a quick read, may have missed it. Initial value £350k. Ablrate loan £450k. Does it say anywhere that funds are handed over in tranches. Given purchase price is £350k and £100k is needed for renovation works on a very short time scale I'd expect the full amount to be given in a lump sum. I'm still struggling with the GDV - not a single house on that street has sold for over £400k. Presumably the hugely increased GDV is dependent on the charity bank/housing authority refinance stuff but nowhere is this explained in any detail. Very disappointed in the risk profile of this loan and the way that Ablrate have spun it in the marketing materials by focusing on the GDV rather than LTV etc. As others have stated, the value of the property is £350k and the loan is for £450k, so this is significantly higher than 100% LTV! A potential 9% p.a. interest is not commensurate with a LTV massively higher than 100%. As wiser people than I have commented above, there is no evidence provided for why this property might be worth £850k one day. It's extremely high for such a property in such an area. The valuation report is very thin on detail. ablrate, please provide £850k valuation reasoning ASAP.
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criston
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Post by criston on Sept 1, 2021 12:37:02 GMT
Mr 10% has paid up.
Could have more information than us.
Need to know if there are tranche pay outs & what makes the dwelling worth £850k on completion, before I even consider joining in.
As it stands, initial LTV will be minus 20% odd.
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Post by Badly Drawn Stickman on Sept 1, 2021 15:37:50 GMT
Mr 10% has paid up. Could have more information than us. Need to know if there are tranche pay outs & what makes the dwelling worth £850k on completion, before I even consider joining in. As it stands, initial LTV will be minus 20% odd. I am not sure the LTV is the relevant bit. Seems a fairly simple bridging loan of cost of property and refurbishment/restyling. The value is presumably entirely in the 'assured' exit strategy. If it works as per the instructions on the tin, then it may well be a good model for lenders.
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criston
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Post by criston on Sept 1, 2021 18:13:32 GMT
Mr 10% has paid up. Could have more information than us. Need to know if there are tranche pay outs & what makes the dwelling worth £850k on completion, before I even consider joining in. As it stands, initial LTV will be minus 20% odd. I am not sure the LTV is the relevant bit. Seems a fairly simple bridging loan of cost of property and refurbishment/restyling. The value is presumably entirely in the 'assured' exit strategy. If it works as per the instructions on the tin, then it may well be a good model for lenders. Would LTV be relevant when £450k is handed out for a £350k property (as it reads) & the borrower immediately say's 'go whistle' ?
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Post by Ace on Sept 1, 2021 19:06:21 GMT
I am not sure the LTV is the relevant bit. Seems a fairly simple bridging loan of cost of property and refurbishment/restyling. The value is presumably entirely in the 'assured' exit strategy. If it works as per the instructions on the tin, then it may well be a good model for lenders. Would LTV be relevant when £450k is handed out for a £350k property (as it reads) & the borrower immediately say's 'go whistle' ? Yes, there's a degree of trust required on this one, as we're clearly underwater to the tune of 100k on day one Personally, I do trust that ABLrate have sufficiently assessed the borrower's intentions and ability. I'm heartened that ABLrate have significantly reduced their fees from their normal levels, thus giving us lenders a proportionally higher share of the borrower fees. They must be expecting this one to run smoothly, as any default would quickly exhaust ABLrate's earnings here. Is 9% an adequate rate for this loan? It is for me... just.
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Post by overthehill on Sept 1, 2021 19:38:08 GMT
I am not sure the LTV is the relevant bit. Seems a fairly simple bridging loan of cost of property and refurbishment/restyling. The value is presumably entirely in the 'assured' exit strategy. If it works as per the instructions on the tin, then it may well be a good model for lenders. Would LTV be relevant when £450k is handed out for a £350k property (as it reads) & the borrower immediately say's 'go whistle' ?
If the borrower's contribution as a first loss is used to purchase the property, that makes it roughly 85% LTV. I don't know if it says the borrower will get the rest upfront or have to submit invoices and evidence of work, that small detail makes a huge difference.
EDIT: 300k/350k = 86% LTV. i.e. borrowers 50k + ablrates 300k is used to buy the property followed by assumption 100k dev spend reduces the %LTGDV to figure stated.
You're probably safer with a 8% Crowdproperty loan, if you can get in one!
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