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Post by masquedefer on Apr 29, 2017 15:05:06 GMT
Possibly LL/SS should include some suitable wording in their instructions to valuers. Something on these lines perhaps?
When carrying out valuations for LL/SS the valuer must bear in mind that LL/SS mainly lend to borrowers who are unable to obtain loans from larger mainstream lenders who operate higher loan eligiility tests. As a consequence there is a much higher risk of loan default and likelihood that the valuation will be subject to real-world testing via repossession/disposal of the asset. It is essential that valuations are provided with this in mind and that valuations err on the conservative side, particularly where there is wider valuation bracket due to lack of information or assumptions including quality of planned building works, local variations in market conditions, etc. Furthermore the valuer must not rely on financial information or projections provided solely by the borrower. The valuer must also understand that the valuer is the lender's eyes and ears on the ground and in accordance with the RICS Red Book, the valuer must report on all factors that might impact on the valuation, its reliability and the sutiability of the asset for secured lending.
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ozboy
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Mine's a Large One! (Snigger, snigger .......)
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Post by ozboy on Apr 29, 2017 15:39:09 GMT
Possibly LL/SS should include some suitable wording in their instructions to valuers. Something on these lines perhaps? When carrying out valuations for LL/SS the valuer must bear in mind that LL/SS mainly lend to borrowers who are unable to obtain loans from larger mainstream lenders who operate higher loan eligiility tests. As a consequence there is a much higher risk of loan default and likelihood that the valuation will be subject to real-world testing via repossession/disposal of the asset. It is essential that valuations are provided with this in mind and that valuations err on the conservative side, particularly where there is wider valuation bracket due to lack of information or assumptions including quality of planned building works, local variations in market conditions, etc. Furthermore the valuer must not rely on financial information or projections provided solely by the borrower. The valuer must also understand that the valuer is the lender's eyes and ears on the ground and in accordance with the RICS Red Book, the valuer must report on all factors that might impact on the valuation, its reliability and the sutiability of the asset for secured lending.For reference, they do have the following in their instruction letter, but I think yours is better! Unfortunately, as we know, nothing is done anyway and the VR is accepted regardless, even when the currently used Instructions clearly aren't fulfilled. No questions are asked, just bung it on to the punters Lenders.
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Post by masquedefer on Apr 30, 2017 10:54:41 GMT
The following to be sent to LL/SS on Monday. Will they listen I wonder? Any other suggestions/additions, etc., greatly appreciated.
Further to my earlier communication (ref xxxx) and following the LL/SS group discussion on the P2P forum site about the accuracy of valuations, LL/SS are requested to:
• Ensure that all Valuers are selected, appointed and paid directly by SS/LL and not by borrowers or intermediaries such as brokers.
• Ensure that all Valuers carry adequate PI cover for the scope and scale of valuations undertaken.
• Ensure that they will not reuse firms whose valuations are found to be outside the normal valuation range/bracket for the type of property.
• Incorporate the following or a similar clause in future valuation instructions……..When carrying out valuations the Valuer must bear in mind that LL/SS mainly lend to borrowers who are unable to obtain loans from larger mainstream lenders who operate higher loan eligibility tests. As a consequence, there is a much higher risk of loan default and likelihood that the valuation will be subject to real-world testing via repossession/disposal of the asset. It is essential that valuations are provided with this in mind and that they err on the conservative side particularly where there is wider valuation bracket due to e.g. lack of information or assumptions including quality of planned building works, local variations in market conditions, etc. Furthermore, the Valuer must not rely on financial information or projections provided solely by the borrower. The Valuer must also appreciate that (s)he is the lender's eyes and ears on the ground and in accordance with the RICS Red Book, the (s)he must report on all factors that may impact on the valuation, its reliability and the suitability of the asset for secured lending.
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Liz
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Post by Liz on Apr 30, 2017 11:35:53 GMT
The following to be sent to LL/SS on Monday. Will they listen I wonder? Any other suggestions/additions, etc., greatly appreciated. Further to my earlier communication (ref xxxx) and following the LL/SS group discussion on the P2P forum site about the accuracy of valuations, LL/SS are requested to: • Ensure that all Valuers are selected, appointed and paid directly by SS/LL and not by borrowers or intermediaries such as brokers. • Ensure that all Valuers carry adequate PI cover for the scope and scale of valuations undertaken. • Ensure that they will not reuse firms whose valuations are found to be outside the normal valuation range/bracket for the type of property. • Incorporate the following or a similar clause in future valuation instructions…….. When carrying out valuations the Valuer must bear in mind that LL/SS mainly lend to borrowers who are unable to obtain loans from larger mainstream lenders who operate higher loan eligibility tests. As a consequence, there is a much higher risk of loan default and likelihood that the valuation will be subject to real-world testing via repossession/disposal of the asset. It is essential that valuations are provided with this in mind and that they err on the conservative side particularly where there is wider valuation bracket due to e.g. lack of information or assumptions including quality of planned building works, local variations in market conditions, etc. Furthermore, the Valuer must not rely on financial information or projections provided solely by the borrower. The Valuer must also appreciate that (s)he is the lender's eyes and ears on the ground and in accordance with the RICS Red Book, the (s)he must report on all factors that may impact on the valuation, its reliability and the suitability of the asset for secured lending.
And why/should they listen to you?
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Balder
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Post by Balder on Apr 30, 2017 11:43:24 GMT
Please correct me if I am wrong here.
The 6 Gloucestershire loans have a total value stated at £5.6M, total loan £3.7185M LTV 66%.
As the loan value also included the interest that Lendy retain then assuming 20% total interest at the end of the term there is approx £3.098M left to repay which is approx 55% LTV against the £5.6M or 77% LTV against I believe someone has quoted total advertised sale prices.
I am not saying that the valuations are OK but as Lendy include the interest in the loan amount then the LTV against the base property values will always be better than published and better than other platforms quoting the same LTV but who do not withhold interest.
Or have I got it wrong?
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r1200gs
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Post by r1200gs on Apr 30, 2017 11:57:51 GMT
The following to be sent to LL/SS on Monday. Will they listen I wonder? Any other suggestions/additions, etc., greatly appreciated. Further to my earlier communication (ref xxxx) and following the LL/SS group discussion on the P2P forum site about the accuracy of valuations, LL/SS are requested to: • Ensure that all Valuers are selected, appointed and paid directly by SS/LL and not by borrowers or intermediaries such as brokers. • Ensure that all Valuers carry adequate PI cover for the scope and scale of valuations undertaken. • Ensure that they will not reuse firms whose valuations are found to be outside the normal valuation range/bracket for the type of property. • Incorporate the following or a similar clause in future valuation instructions…….. When carrying out valuations the Valuer must bear in mind that LL/SS mainly lend to borrowers who are unable to obtain loans from larger mainstream lenders who operate higher loan eligibility tests. As a consequence, there is a much higher risk of loan default and likelihood that the valuation will be subject to real-world testing via repossession/disposal of the asset. It is essential that valuations are provided with this in mind and that they err on the conservative side particularly where there is wider valuation bracket due to e.g. lack of information or assumptions including quality of planned building works, local variations in market conditions, etc. Furthermore, the Valuer must not rely on financial information or projections provided solely by the borrower. The Valuer must also appreciate that (s)he is the lender's eyes and ears on the ground and in accordance with the RICS Red Book, the (s)he must report on all factors that may impact on the valuation, its reliability and the suitability of the asset for secured lending.
And why/should they listen to you? Perhaps they won't, but they should also keep in mind that such a reasonable request is probably the wish of pretty much all lenders on the platform. To be honest, if I had any idea that something other than a completely independent valuation by a person appointed by the platform was a possibility, I would have been a lot more cautious than I am now, and my investment is already dropping.
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Post by masquedefer on Apr 30, 2017 12:40:37 GMT
Please correct me if I am wrong here. The 6 Gloucestershire loans have a total value stated at £5.6M, total loan £3.7185M LTV 66%. As the loan value also included the interest that Lendy retain then assuming 20% total interest at the end of the term there is approx £3.098M left to repay which is approx 55% LTV against the £5.6M or 77% LTV against I believe someone has quoted total advertised sale prices. I am not saying that the valuations are OK but as Lendy include the interest in the loan amount then the LTV against the base property values will always be better than published and better than other platforms quoting the same LTV but who do not withhold interest. Or have I got it wrong? £3.7185M was borrowed. £3.7185M is still owed. The fact that LL/SS deducted the interest payments up front out of the loan money is irrelevant, it just means that part of the loan was used to finance the interest.
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Post by masquedefer on Apr 30, 2017 13:06:07 GMT
Liz who said ........And why should they listen to you? Probably not, which is why I tried to obtain support on this forum. They are not unreasonable requests and are even in LL/SS's own long-term financial and business survival interests. It is clearly not in their interests to have defaults against inadequate equity. What I am requesting is also not untypical of valuation instructions which I receive from other relatively smaller lending organisations. I also personally think they represent best practice.
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Liz
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Post by Liz on Apr 30, 2017 13:53:03 GMT
Liz who said ........And why should they listen to you? Probably not, which is why I tried to obtain support on this forum. They are not unreasonable requests and are even in LL/SS's own long-term financial and business survival interests. It is clearly not in their interests to have defaults against inadequate equity. What I am requesting is also not untypical of valuation instructions which I receive from other relatively smaller lending organisations. I also personally think they represent best practice. Are their practises industry standard or are LTPP any different to any other p2p bridging/development site? LTPP won't listen to use mere mortals whilst they can fill loans and fill them as low as 7%, if you can find several members with millions invested then you might get listened to. If these measures will cost LTPP money, then again why would they spend the money whilst they are filling loans 30 X oversubscribed? This ship has sailed for a lot of forum members, so expect less support than you would have got 12 months ago. I do wish you good luck.
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elliotn
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Post by elliotn on Apr 30, 2017 14:19:33 GMT
A couple of the last few lower percenters had unsubscribed funds listed on the SM ie not 30x oversubscribed (exaggeration for effect aside), let's not give up hope they may listen to their investors yet - BHs leaving, a saturated SM, loans more regularly unfilled - they may just have to.
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Liz
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Post by Liz on Apr 30, 2017 14:32:23 GMT
A couple of the last few lower percenters had unsubscribed funds listed on the SM ie not 30x oversubscribed (exaggeration for effect aside), let's not give up hope they may listen to their investors yet - BHs leaving, a saturated SM, loans more regularly unfilled - they may just have to. As soon as they get ISA money then we may resort back to status quo. ie radio silence.
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Post by Deleted on Apr 30, 2017 16:21:53 GMT
Yeah, we've seen the SM get very close to saturation point when the total live loan book (including defaults) gets to about the 185m mark
So if they want to reach their goal of being 'the biggest property site' or whatever, then they are going to have to start paying attention to lenders again at some point.
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Liz
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Post by Liz on Apr 30, 2017 17:10:23 GMT
So if they want to reach their goal of being 'the biggest property site' or whatever, ...... You always need to use the word "Universe" LTPP Where the valuations are out of this world. 
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jonah
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Post by jonah on Apr 30, 2017 17:50:29 GMT
Yeah, we've seen the SM get very close to saturation point when the total live loan book (including defaults) gets to about the 185m mark So if they want to reach their goal of being 'the biggest property site' or whatever, then they are going to have to start paying attention to lenders again at some point. It will be interesting to see how much the monthly interest run tomorrow reduces the SM availability.
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Post by GSV3MIaC on Apr 30, 2017 18:20:16 GMT
Would normally have reduced it already, but the 'no INPL for SM purchases' scuppered that game. 8>.
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