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Post by valueinvestor123 on Feb 14, 2015 17:04:54 GMT
I am curious what happens in the event of asset (mis)valuation with asset-backed loan sites like Assetz Capital, Funding Secure, SS, Thincats etc. Basically if the valuation was seriously out of whack either through negligence or due to document forgery or anything else...who is liable at the end? Is there some sort of indemnity insurance or how does this work?
And has something like this happened?
thanks, vi123
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Post by mrclondon on Feb 14, 2015 17:19:48 GMT
I am curious what happens in the event of asset (mis)valuation with asset-backed loan sites like Assetz Capital, Funding Secure, SS, Thincats etc. Basically if the valuation was seriously out of whack either through negligence or due to document forgery or anything else...who is liable at the end? Is there some sort of indemnity insurance or how does this work? And has something like this happened? thanks, vi123 A partial answer to your question was provided by Andrew Holgate recently "Assetz Capital contracts an independent legal firm to produce the loan documentation. If it is found that the firm has made a mistake, then Assetz Capital can make a claim on behalf of the lenders against the firm's PI cover. Similarly, where any third party is used for legal, accountancy or valuation work, we ensure they have the appropriate PI cover and that they are appointed to act in the right way and they confirm their PI is at risk if they are found wanting. This ensures that AC can pursue a claim under the PI on behalf of the lenders. If a third party does not have PI cover we will not use them."PI = professional indemnity
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Post by tybalt on Feb 14, 2015 18:06:53 GMT
In a lot of cases the valuations are so tinged with Caveats as to make them meaningless. My favourites are the valuations of licensed premises which are based on the forecast turnover and profitability of the outlet.
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