|
|
Post by chielamangus on Nov 28, 2015 19:55:26 GMT
I guess the point is that there is no obligation on the borrower to undertake the renovations. Hence the only "firm" security is the valuation in its current state. However the knowledge that there are funds available to support the "intended" renovation goes some way to providing confidence in the exit plan. No one has actually said the borrower has other funds of any worth to support a renovation. Do you think any renovation by the current owner is likely or worthwhile anyway? As SS say, no one gives a damn what the borrower does with the money, as long as there is adequate security. So the real issue for investors is how reliable the valuation is. 23 acres is apparently worth about £230k. Are the house and outbuildings worth £1.5m?? Actually, there is another issue. Is the borrower getting the best financial advice and pursuing the best strategy? Why not an outright sale now and save on our interest and SS fees? And if this loan is good for the borrower, how and why? But in P2P lending we don't ask these questions - heaven forbid that any morality issues should be involved.
|
|
mikes1531
Member of DD Central
Posts: 6,453
Likes: 2,320
|
Post by mikes1531 on Nov 29, 2015 20:12:43 GMT
... but we are content to lend 70% against todays valuation. : But you aren't lending to this borrower -- we are. And it's our money that's at risk if the borrower's exit plan doesn't work, and you have to dispose of the property for us. So it ought to be the people who are putting up the money who make the judgement as to what they'd like to know. And as ablender said, just because I didn't ask a question doesn't mean I wouldn't be interested in -- and consider relevant -- the answer. If, like another platform, you'd rather not publish 'questions' that aren't questions at all -- most likely being opinions or unwarranted criticisms -- I have no problem with that. But if people ask genuine questions regarding a loan such as those raised above, and the answers reveal info that hadn't already been made available, then you should have no objection to having it put on your website where anyone interested in that loan can see the question and the answer. Give your investors some credit for being able to distinguish between what's relevant to them and what isn't. They will ignore the bits that are irrelevant to them. If you don't give them the opportunity, they can't. Why make it harder for yourselves -- because you'll have to answer similar questions multiple times, or upset people by not answering at all? And harder for your investors -- by making them think of everything they might like to know that they haven't already been told and making them ask you for it?
|
|
ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 11,330 
Likes: 11,549
|
Post by ilmoro on Nov 29, 2015 20:45:21 GMT
... but we are content to lend 70% against todays valuation. Why make it harder for yourselves -- because you'll have to answer similar questions multiple times, or upset people by not answering at all? And harder for your investors -- by making them think of everything they might like to know that they haven't already been told and making them ask you for it? At least 3 people have now asked some variant of the same question - in my case about 10 minutes before SS popped up on the forums last night with a non-numerical response (coincidence maybe) - and thats just the ones that have revealed themselves on here. I suspect several people have asked a question about the status of the planning at Hull, which again would seem a fairly key piece of information to provide to investors as the documents do not appear to provide a clear answer. I would be amazed if in the case of loans that are near or past their redemption dates there arent multiple questions on whats going on. Yet no sign of your Q&A on PBL36, for example, on the site. SS are going to end up with a very cluttered inbox I suspect.
|
|
ben
Posts: 2,020
Likes: 589
|
Post by ben on Nov 30, 2015 8:32:03 GMT
the replies from ss appear to me that they no longer care, the money being lent is no longer theirs so no real risk to them, they get money whatever happens and will have very low overheads now .
Also with how fast everythng gets snapped up at moment i think they are not to worried about funding loans, just getting as many on as possible and if it goes belly up in a year they have made plenty of money
|
|
beechside
Member of DD Central
Posts: 152
Likes: 197
|
Post by beechside on Nov 30, 2015 11:35:52 GMT
Warning - opinions ahead ;o)
I look at these as loans. For my 12%, I take a risk on whether or not I will recoup my initial outlay. I'm with SS on saying that the only measure is the current LTV. I don't really like 70% LTV so could pass but I'll probably take it and sell before maturity. The SM makes my investment decisions so much easier. Get in early and sell early. It doesn't mean all loans are bad but it's about mitigating risk.
To me, the potential for greatest personal impact is SS going under (who's done DD on SS themselves, by the way? Would be grateful for a link or two). Insolvency practitioners are not known for their altruism and could easily raid proceeds to fund their own "legitimate expenses". You can then forget 70%.
Incidentally, the deepest residential property slump was about 28% back in 2008 (source Halifax Price Index). However, try selling a half-completed refurb and you'll be lucky to get 50% of the pre-refurb value.
I'd rather someone took the money and squandered it than started a build and then go bust. I don't expect SS to have a view on whether a refurb will be completed. However, I will always be more cautious when it involves residential projects. The individual is far more likely to fall foul of budget limits than a corporate who (in theory) should have higher standards, better project management and good quantity surveyors on the case.
So, I'm agnostic about the Q&A and don't blame SS in the least for not bothering (they never have* and it should have been simply retired in the new web site - bet they're regretting it now). Yes, I would like the monthly updates to be individually added to each loan but it's no hardship opening up the latest email.
I think SS are a terrific outfit and, with apologies should I cause offence, I think there are bigger fish to fry than whether SS put this info on their web site. We have a professional valuation and a team that I believe are in it for the long run. I've certainly seen no evidence to the contrary and suggestions that they will cut and run are unfounded and dangerous.
*For clarity: I mean SS have never updated the Q&A section of the web site. They have, in my experience, always responded to emails and given full answers.
|
|
|
|
Post by savingstream on Nov 30, 2015 12:27:47 GMT
the replies from ss appear to me that they no longer care, the money being lent is no longer theirs so no real risk to them, they get money whatever happens and will have very low overheads now . Also with how fast everythng gets snapped up at moment i think they are not to worried about funding loans, just getting as many on as possible and if it goes belly up in a year they have made plenty of money This is simply not true in the slightest. Our entire reputation is on the line for every single loan that we make. We might not be legally on the hook for the new loans coming through the pipeline, but we are on the hook from a business longevity POV.
|
|
|
|
Post by savingstream on Nov 30, 2015 12:31:10 GMT
Warning - opinions ahead ;o) I look at these as loans. For my 12%, I take a risk on whether or not I will recoup my initial outlay. I'm with SS on saying that the only measure is the current LTV. I don't really like 70% LTV so could pass but I'll probably take it and sell before maturity. The SM makes my investment decisions so much easier. Get in early and sell early. It doesn't mean all loans are bad but it's about mitigating risk. To me, the potential for greatest personal impact is SS going under (who's done DD on SS themselves, by the way? Would be grateful for a link or two). Insolvency practitioners are not known for their altruism and could easily raid proceeds to fund their own "legitimate expenses". You can then forget 70%. Incidentally, the deepest residential property slump was about 28% back in 2008 (source Halifax Price Index). However, try selling a half-completed refurb and you'll be lucky to get 50% of the pre-refurb value. I'd rather someone took the money and squandered it than started a build and then go bust. I don't expect SS to have a view on whether a refurb will be completed. However, I will always be more cautious when it involves residential projects. The individual is far more likely to fall foul of budget limits than a corporate who (in theory) should have higher standards, better project management and good quantity surveyors on the case. So, I'm agnostic about the Q&A and don't blame SS in the least for not bothering (they never have and it should have been simply retired in the new web site - bet they're regretting it now). Yes, I would like the monthly updates to be individually added to each loan but it's no hardship opening up the latest email. I think SS are a terrific outfit and, with apologies should I cause offence, I think there are bigger fish to fry than whether SS put this info on their web site. We have a professional valuation and a team that I believe are in it for the long run. I've certainly seen no evidence to the contrary and suggestions that they will cut and run are unfounded and dangerous. Thanks so much for your support.
|
|
|
|
Post by Deleted on Nov 30, 2015 12:38:01 GMT
POV means point of view and, I'm assuming, has no sexual innuendo
|
|
webwiz
Posts: 1,133
Likes: 210
|
Post by webwiz on Nov 30, 2015 15:57:18 GMT
the replies from ss appear to me that they no longer care, the money being lent is no longer theirs so no real risk to them, they get money whatever happens and will have very low overheads now . Also with how fast everythng gets snapped up at moment i think they are not to worried about funding loans, just getting as many on as possible and if it goes belly up in a year they have made plenty of money Don't forget the Provision Fund. That's their money not ours and they take the first hit on a bad loan not us.
|
|
|
|
Post by savingstream on Nov 30, 2015 16:02:18 GMT
the replies from ss appear to me that they no longer care, the money being lent is no longer theirs so no real risk to them, they get money whatever happens and will have very low overheads now . Also with how fast everythng gets snapped up at moment i think they are not to worried about funding loans, just getting as many on as possible and if it goes belly up in a year they have made plenty of money Don't forget the Provision Fund. That's their money not ours and they take the first hit on a bad loan not us. Indeed, we forgot about the small matter of £1m of our own funds tied up in a bank account to be used as first loss (discretionary)...
|
|
|
|
Post by mrclondon on Nov 30, 2015 23:14:21 GMT
After all the discussion this proposed loan has prompted on this thread and the Q&A thread, and in particular doubts expressed about the valuation, I decided I had better take a much closer look before committing funds myself.
Reading the valuation report section on comparables (page 20) I'm left with the impression that the property should be worth at least £1.6m in better condition (£1.4m of the first comparable + 12% property inflation plus an allowance for more land ). So the question is what is the probability the property could be sold in its current condition for at least £1.3m (our loan value) at auction ? To my mind it feels that the refurbishment work needed to bring the property to a standard where it is practical for it to be bought by a non-developer is significantly less than £300k, so at a £1.3m purchase price there should be enough headroom for a developer to make a profit after fees and development costs.
To my mind this is on a par with other bridging loans offered on SS and other platforms at a 12% yield.
|
|
|
|
Post by dodgeydave on Dec 2, 2015 9:44:57 GMT
Just got 42% of my prefunding amount
|
|
ben
Posts: 2,020
Likes: 589
|
Post by ben on Dec 2, 2015 9:59:01 GMT
Got similar , there must be some seriously big investors on there someone had 70,000 up on one loan and was gone before i even clicked it from refreshing page
|
|
SteveT
Member of DD Central
Posts: 6,875
Likes: 7,924
|
Post by SteveT on Dec 2, 2015 10:06:44 GMT
First new loan there's been a text message about for a while too.
|
|
Investor
Member of DD Central
Posts: 662
Likes: 590
|
Post by Investor on Dec 2, 2015 10:15:52 GMT
and the first loan to have >£3m Pre-funded. Main sheet has been updated on the sticky page
|
|
