oldgrumpy
Member of DD Central
Posts: 5,087 
Likes: 3,233
|
Post by oldgrumpy on Feb 25, 2016 16:18:03 GMT
Don't prop 'em up?  I see the borrower for #20623/4 ( an A+ borrower to whom I lent at 8% + 2% cashback on his previous venture) now wants more money but his risk has deteriorated to A and the 8% has not improved, and the cash back has gone. Feelingin Credible sent me an emailing about why I was withdrawing funds. I wonder if they comprehend the implications of me suggesting I can do very much better than 7% (after fees) for this kind of loan on rival platforms. |
|
am
Posts: 1,495
Likes: 601
|
Post by am on Feb 25, 2016 18:06:14 GMT
This is "interesting" one: Expansion And Growth Loan (20544). 2 consecutive years (2013,2014) of losses, negative assets and 0 credit score. No info on 2015. And the rating is A+. I'm all in.  From Q&A: "The reason for the A+ rating is due to the strength of the Group and the strength of the Directors personal guarantees" . At least they've answererd few questions. Unfortunately, while they've given us the accounts for the guaranteeing company, they haven't given us the accounts for the group.
|
|
am
Posts: 1,495
Likes: 601
|
Post by am on Feb 25, 2016 18:16:24 GMT
Don't prop 'em up? I see the borrower for #20623/4 ( an A+ borrower to whom I lent at 8% + 2% cashback on his previous venture) now wants more money but his risk has deteriorated to A and the 8% has not improved, and the cash back has gone. Feelingin Credible sent me an emailing about why I was withdrawing funds. I wonder if they comprehend the implications of me suggesting I can do very much better than 7% (after fees) for this kind of loan on rival platforms. I suspect that there isn't an increased risk (for 20624), but just FC's habit of putting property development loans as A+ and bridging loans as A. Looks like I've got another early repayment in prospect, as tranche 4 isn't due to repay until April. 20623 has a higher LTV.
|
|
andyp
Stubborn Yorkshireman from the rhubarb triangle
Posts: 150
Likes: 115
|
Post by andyp on Mar 10, 2016 22:22:26 GMT
The way Fumbling Coterminosity handle the end of a multi-tranched loan, and indeed any loan that is late, is a mess. The tranches dont match the underlying loan and they have extreme difficulty in paying anything other than 'a month's extra interest'. God only knows how they are going to use the proceeds of Richmond 8 to pay the extension of the overall loan. Security still looks good though. FC "have granted the borrower a 3 month loan extension to secure sale and completion of the two units at this development. We are expecting the first tranche to be repaid at the end of this month and interest will continue to be paid each month to investors until repayment is received." The have removed the risk band from Richmond 1-3 & 5-7, they forgot to derate 4 for some reason. The happy borrower gets an extra 3 months at 7.5% without penalties and all the lenders are locked in. Given the original 8month loan had 2% cash back the effective rate on the loan was 10.5%, whereas after the default they are paying 7.5%, a discount of 28.6%. Breach the contract and get a discount, certainly a novel marketing ploy by FC, but not one to encourage lenders I suspect!
|
|
SteveT
Member of DD Central
Posts: 6,875
Likes: 7,924
|
Post by SteveT on Mar 10, 2016 22:25:50 GMT
The happy borrower gets an extra 3 months at 7.5% without penalties and all the lenders are locked in. Given the original 8month loan had 2% cash back the effective rate on the loan was 10.5%, whereas after the default they are paying 7.5%, a discount of 28.6%. Breach the contract and get a discount, certainly a novel marketing ploy by FC, but not one to encourage lenders I suspect! The cost of added CB came out of Financially Challenged's margin so strictly speaking the borrower will not be getting any discount.
|
|
andyp
Stubborn Yorkshireman from the rhubarb triangle
Posts: 150
Likes: 115
|
Post by andyp on Mar 10, 2016 22:43:17 GMT
You may well be right, but that doesn't improve my return.
|
|
blender
Member of DD Central
Posts: 5,719
Likes: 4,272
|
Post by blender on Mar 10, 2016 23:45:02 GMT
You may well be right, but that doesn't improve my return. Not 'may well be right', stevet is right, because he knows that cash back comes from FC, from their fee from the borrower. Agreed that an extension of 3 months at the same rate is a good deal for the borrower, but it is not outrageous.
|
|
adrianc
Member of DD Central
Posts: 10,019
Likes: 5,147
|
Post by adrianc on Mar 11, 2016 8:31:57 GMT
You may well be right, but that doesn't improve my return. No, but it does address your complaint - that the borrower was getting a discount. CB is a front-loaded incentive to buy. If a loan repays early, it's concentrated. If a loan repays late or is formally extended, it's watered-down. If the original buyer strips-and-flips, that's their profit. Or, to look at it another way, buy on the interest rate, regarding any CB as a little gift from Father Christmas, and you're about right.
|
|
bigfoot12
Member of DD Central
Posts: 1,817
Likes: 816
|
Post by bigfoot12 on Mar 11, 2016 9:06:05 GMT
No, but it does address your complaint - that the borrower was getting a discount. CB is a front-loaded incentive to buy. If a loan repays early, it's concentrated. If a loan repays late or is formally extended, it's watered-down. If the original buyer strips-and-flips, that's their profit. Or, to look at it another way, buy on the interest rate, regarding any CB as a little gift from Father Christmas, and you're about right. Christmas seems to have been cancelled.
|
|
acky
Posts: 481
Likes: 262
|
Post by acky on Mar 11, 2016 12:29:41 GMT
No, but it does address your complaint - that the borrower was getting a discount. CB is a front-loaded incentive to buy. If a loan repays early, it's concentrated. If a loan repays late or is formally extended, it's watered-down. If the original buyer strips-and-flips, that's their profit. Or, to look at it another way, buy on the interest rate, regarding any CB as a little gift from Father Christmas, and you're about right. Christmas seems to have been cancelled. .. perhaps that's because none of us believe in Father Christmas any more!
|
|
|
|
Post by GSV3MIaC on Mar 14, 2016 20:30:13 GMT
Hendon 10 is looking a bit fragile, despite being smallish. I wonder if it'll come back at a higher rate, or maybe some of that missing CB?
|
|
acky
Posts: 481
Likes: 262
|
Post by acky on Mar 14, 2016 21:38:33 GMT
Hendon 10 is looking a bit fragile, despite being smallish. I wonder if it'll come back at a higher rate, or maybe some of that missing CB? Doesn't it first have to go through the loop of being pulled (with or without "technical error") and then being relisted on "terms more favourable to investors", i.e. identical terms except for being half the principal?
|
|
jayjay
Member of DD Central
Posts: 264
Likes: 116
|
Post by jayjay on Mar 15, 2016 9:14:19 GMT
Hendon 10 is looking a bit fragile, despite being smallish. I wonder if it'll come back at a higher rate, or maybe some of that missing CB? Doesn't it first have to go through the loop of being pulled (with or without "technical error") and then being relisted on "terms more favourable to investors", i.e. identical terms except for being half the principal? When we get to the ISA launch maybe it will be the first on the wrong side of the fence. The non-Isa investors can munch carefully on the first bit of Hendon CB, whilst the ISA holders look on. More likely ISA investors will be in an autobid induced haze and FC will hope they don't notice. PS My ISA will be S&S this coming year - the IFISA is inconducive to easy withdrawal in the case of a crisis.
|
|
|
|
Post by GSV3MIaC on Mar 15, 2016 13:13:44 GMT
Plus the stock market is semi-tanked (not to say it can't go lower if it puts its mind to it). You are right though, IFISA is not the first stop for any money which requires liquidity or minimum risk.
|
|
|
|
Post by Deleted on Mar 15, 2016 15:08:59 GMT
Plus the stock market is semi-tanked (not to say it can't go lower if it puts its mind to it). You are right though, IFISA is not the first stop for any money which requires liquidity or minimum risk. I don't have the full details. But if you think to the RS ISA, if they maintain the full Provision Fund they built in many years, I see it being a very conservative pot of security placed on funds. And usually the exit route from RS is easy (P&L only depends on future market movements, which are unpredictable). As for the stock market, don't forget a few months ago the FTSE reached its maximum. I certainly would not consider it at all safe (specially in case of a Brexit).
|
|
