j
Member of DD Central
Penguins are very misunderstood!
Posts: 2,188 
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Post by j on Mar 7, 2015 21:03:57 GMT
Dear savingstream/Lendy Your growth over the last few months is to be congratulated. The weekly comms & interaction on this site with lenders is admired. The main issue though is that despite indicationsto resolve, the trust/SPV aspect is still up in the air. Other p2p lenders seem able to resolve this issue so, surely it is doable. It works in SS's favour as more of us will lend significantly more funds on the platform, meaning better returns for SS. Has there been any more progress on the matter to put lenders' mind to rest? Thanks |
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j
Member of DD Central
Penguins are very misunderstood!
Posts: 2,188
Likes: 540
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Post by j on Mar 11, 2015 9:50:39 GMT
Will take the radio silence as a clear indication we are nowhere near resolving the issue. I'm off to look at my funds with SS to reduce exposure drastically as I refuse to invest at my current level or more without further input/clarification on the matter.
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unmadem
Member of DD Central
Posts: 377
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Post by unmadem on Mar 11, 2015 15:53:07 GMT
Since xmas I have just recycled completing loans due to my nervousness around this issue. If resolved I'd probably double my investment level.
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Post by solicitorious on Mar 11, 2015 15:58:37 GMT
For the benefit of all, can people summarize the risks of this structure, as they see them?
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j
Member of DD Central
Penguins are very misunderstood!
Posts: 2,188
Likes: 540
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Post by j on Mar 11, 2015 16:28:05 GMT
For the benefit of all, can people summarize the risks of this structure, as they see them? My understanding is that regardless of how many loans & how much you put in each, you are effectively lending your funds collectively to SS/Lendy (parent co/owner). Lendy lend the money to the borrowers directly & we lend the money to Lendy, not the borrower directly. Othe p2p platforms, like AC, act as the middle man by simply bringing borrower/lender together onto the platform. Each loan on AC is treated as an SPV. With SS, you do not have this structure, which is what we all are crying out for. If Lendy went under, all your investment is vulnerable regardles of individual LTVs & solidity of individual loans. A single big loan loss can probably cause this, hence the much higher risk. Hope I explained in simple terms but others are welcome to modify/correct.
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manue
Posts: 25
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Post by manue on Mar 11, 2015 17:42:55 GMT
The way I see it is every platform has a different format non of them suit everybody you just have to pick the ones that you think will be good for you, and get used to the risk/reward that your investment will provide. To me it all comes down to trust and the good morals of the directors of these companies, no doubt some of these loans will go bad but if SS/Lendy have carried out proper DD with regards the valuations on the asset then the downside should not be disastrous.
If one of these p2p companies goes bust big time you can pretty much say goodbye to this form of lending, there will be a national outcry of enormous proportions because of the millions involved, you can bet you bottom dollar the government won't bail us or the unregulated p2p finance companies out.
The name of the game is risk, trust, reward..
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ramblin rose
Member of DD Central
“Some people grumble that roses have thorns; I am grateful that thorns have roses.” — Alphonse Karr
Posts: 1,370
Likes: 857
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Post by ramblin rose on Mar 11, 2015 18:54:39 GMT
For the benefit of all, can people summarize the risks of this structure, as they see them? ........................With SS, you do not have this structure, which is what we all are crying out for. If Lendy went under, all your investment is vulnerable regardles of individual LTVs & solidity of individual loans. A single big loan loss can probably cause this, hence the much higher risk. Not quite all of us are crying out for it, actually. I've kept reasonably quiet in those discussions because I can see why many/most want the standard p2p structure. It would certainly reduce the overall risk and would keep most people happier. But for myself, I'm happy to carry that additional risk because I've liked having a platform where I've not had to worry about which loans I've got into, beyond a personal desire to spread my repayment timings. On other platforms I need to pay particular attention to all the details of the borrower, their business and what I consider to be the risks of default, because if the loan defaults I stand a chance of losing some money. On SS I have the luxury of not having to worry about that at all - any given loan has the potential to cause exactly the same problems whether I've lent against it or not. So it's simple and straightforward - if there is loan availability at a time I have some money, I lend it. I lend here with full awareness of the risks and am personally happy with it.
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mikes1531
Member of DD Central
Posts: 6,452
Likes: 2,320
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Post by mikes1531 on Mar 11, 2015 18:56:54 GMT
For the benefit of all, can people summarize the risks of this structure, as they see them? My understanding is that regardless of how many loans & how much you put in each, you are effectively lending your funds collectively to SS/Lendy (parent co/owner). Lendy lend the money to the borrowers directly & we lend the money to Lendy, not the borrower directly. Othe p2p platforms, like AC, act as the middle man by simply bringing borrower/lender together onto the platform. Each loan on AC is treated as an SPV. With SS, you do not have this structure, which is what we all are crying out for. If Lendy went under, all your investment is vulnerable regardles of individual LTVs & solidity of individual loans. A single big loan loss can probably cause this, hence the much higher risk. Hope I explained in simple terms but others are welcome to modify/correct. There also is the fact that SS have stated here in this forum -- and reiterated -- that if any borrower defaults they will use their own funds to prevent their lenders from losing money. That is not in the Ts&Cs, and it's not obvious whether SS/Lendy have enough resources to be able to do this in the event of a default with a large PBL. (At the time it was stated/reiterated, SS hadn't started offering PBLs. It also was before SS said they'd put money into a Provision Fund.) One PBL default, therefore, could cause a knock-on effect which could seriously damage the platform, particularly if it affects lenders in other loans which were perfectly OK at the time. That's part of the reason a trust holding all the security on behalf of the lenders would be very desirable.
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