H****ey Br*****g L**n

That was nodnoL, notloB crops up in Monty Python's dead parrot sketch.

So I put in a serious point hoping for guidance and all I get is a load of excitement about sad teardrop (anagramsite.com)

dead parrots

Everybody was expecting that one

well yes that was rather my point, that there is a good chance that the loan will be sweetened by a month or 2 of interest at 18%.

I did read somewhere just recently though that for distressed sales you should figure 66% of full valuation (which I think means that to feel safe one is looking for 66% ish LTV, less say another 5% to cover interest, and no doubt another 5% to cover dead money while the sale takes place, say 55% in all)

If you read the AC valuation reports thoroughly, often the valuer is asked to provide a value for a sale with a time restriction of, say, three or six months.  The discount required for a faster sale -- compared to waiting for a buyer to come along and pay the full value -- can be eyewatering!  In the case of borrower defaults, therefore, I think we should expect either a long wait for our money or a faster return and a capital loss.  (Not forgetting, of course, that lender interest is at the end of the queue for repayments after foreclosure administration fees, introducer fees, AC fees, etc.)

In short, while 70% LTV sounds like it ought to be more than adequate to protect lenders, lenders still are taking on a risk in order to receive their returns.  Whether all P2P/P2B lenders realise that risk exists is another matter completely.