PBL 069; PBL 070 & PBL 071 - the Gloucestershire Loans

IRC HNW have

So, basically, there's Football Association chance of any claim ever against PI Insurance, regardless of how wildly inaccurate, and even possibly fraudulent, a Valuation Report might be?

All very cosy isn't it. Makes me feel even warmer & more comfortable than ever.

All understood georget, but you don't think there's such animals as "Tame" Valuers?

There are enough Valuations discussed on here over the past year that have been obviously and wildly misleading and/or inaccurate, it kind of dents the "Profession" a bit don't you think?

Yes, hands up, I AM distrustful of valuations carried out by qualified valuers, and with good reason I think. 

It's not only the Valuations per se, there's also the little matter of inadvertently and conveniently omitting highly significant, material facts in the VRs.

One instance I recall is the Platform explicitly instructing the Valuer to comment & report on planning permissions regarding the property and PP comments were completely absent from the VR, which the Platform knowingly accepted and then presented to Investors. Of course, the property was/is riddled with pp question marks but this omission was all deemed OK in the scheme of things!

Is this in any way acceptable?

OK, so if the above were true, we would clearly expect quite wide error margins in valuations, particularly in more specialised types of property.  Fair enough. However, if all valuations were genuine, then we would obviously expect roughly equal numbers of under-valuations and over-valuations, and we are most definitely not seeing this. As we all know, virtually all errors in valuations  over-value the asset. 

Valuers clearly pander to the wishes of the client. It has always been thus and probably always will be. 

Thank you for your interesting comments.


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@ Dandy. Not correct, as I understand the law. One can claim all reasonably foreseeable consequential losses and costs. The SAAMCO cap merely limits the claim total to the difference between the negligent valuation and the true valuation (not including includes legal costs). So in this particular case, due to the excessive overvaluation, the SAAMCO cap would be £1.23 million (£5.23m - £4.0m) which would be more than adequate to cover likely losses.

@ Lobster & Georget - Good points, although I thought LL/SS appointed and directly paid the Valuation Surveyors (i.e. not the broker or the borrower), so if there is any biais, the valuer should be erring on the side of his Client's aims (i.e. not to have overvaluations). If any Lendy staff are pressurising Valuers otherwise, they should be sacked immediately.


As far as I am aware no LL/SS investors have incurred any losses on previous failed investments. The Glos Loans are likely to be the first (of several others also in the pipeline). The purpose of my post was to guage investor interest and resolve for recovering their losses wherever possible.

There are plenty of no win no fee solicitors who would gladly take on this case, especially given the high chance of success, due to the gross overvaluation and the ability of the surveyor (via PI insurer) to pay the quantum and all legal costs.

PI insurers do pay out on a regular basis on negligent valuations. It is just not advertised. That's why PI premiums for surveyors are very high.

I assume LL/SS monitor this forum and formally request that they notify the surveyor of a potential claim. If (as some forum writer's beleve) LL/SS will not go down this route to recover losses then I suppose directly affected investors can do it ex parte on account of LL/SS failing to exercise proper fiducuary interest.  

Also I formally request that LL/SS do not use this surveying firm again.

Even if the LL/SS reserve fund reimburses all losses there is still a patent case for a making a claim against the surveyor (in order to replenish the reserve fund), which also raises another question that perhaps ALL LL/SS investors have an interest in this matter. After all why should the reserve fund deplete itself when a valid claim could be made elsewhere to recover the loss.

Any other lending institution, banks, BSs, etc. and their major investors, would not take the view (as some forum members) that valuation reports amount to zilch and so should not be relied upon. They can reasonably be relied upon by investors and where there are excessive over/under valuations the surveyor is liable in negligence.

Are there any Glos Loans investors supportive of attempting to recover their likely losses arising from the massive 40% negligent over-valuation and putting the surveying firm (and current PI insurer) immediately on notice?

One reason why the platform may not discourage 'over' valuations is to get the business. Quite regularly the loan is for purchase and pp/legal costs so a residual valuation could be greater than purchase & the platform bags their execution fee.