Property development loan end dates

I'm trying to understand the exact significance of the comment made by FC against the (ever-so-late) London short-term property loans :

"...We can confirm that interest on this loan has increased by 2% which is applicable from the date of expiry..."

I assume that the borrower is being expected to pay 2% more than the existing 10% rate. Will lenders also see this increase in interest?

Yes, that's fairly fundamental, isn't it! OK, so I was tired.
Thanks Blender.

The valuation is always the full market value the RICS valuer believes the completed properties would have in the current market when the valuation is carried out. This has been confirmed by FC in Q&A. RICS valuers don't and couldn't predict what the market will do in the future - no one knows.

The valuers have to work to the RICS approved process when making their valuation. Of course, if a sale were needed quickly to repay the loan in a default situation it might be necessary to drop the price substantially, perhaps down to 75% of whatever the market value is come the day. Alternative valuations like this with various caveats are probably in the reports, but FC doesn't share reports with us so we have to make our own assumptions.

Note that for later tranches of ongoing projects, the valuation is still the original one done when the first tranche was listed. Market prices have probably moved since then, in recent times generally upwards. Refinancing onto new loans usually comes with an updated valuation.

Please remove the borrower's name, your lordship.

I believe not.

And in the case of the one(s) where the borrowers never did actually buy any properties, there's a charge on their current portfolio. That loan had a business plan of selling their current portfolio (which repays the FC loan) and buying different properties giving a higher return. (I haven't seen any recent mentions of that loan - anyone know the current state?)

What the borrowers "needed" in that case was not a loan, but a line of credit. In hindsight FC should have sent them elsewhere, but perhaps FC weren't to know that their hopes of finding properties to purchase were overoptimistic. I'm not in that loan because I don't trust London valuations and (IIRC) because of execution risk in the borrowers business plans. As it panned out the borrowers have spent a lot of money on excess interest. I hope they can extract themselves from the loan without further loss.