DFL001 - Exeter Loan 1 - DEFAULT

I'm not sure I agree with the above.  If an investor pre-funds a new tranche for £5k, that's supposed to mean they want £5k more of that loan.  If it turns out that the maximum allocation is only £3k, then I don't see how they could be aggrieved if Lendy were to take £2k from the front of the SM queue for that loan and allocate it to the investor so that they received all they pre-funded for.  Should they really care where the parts came from (PM vs. SM) as long as they don't have to pay for them instantly upon allocation?

There might be a slight issue if investors were to be putting in large pre-funding requests feeling confident they'd never be allocated the full amount because of the size of the tranche and then being surprised to find their requests have been allocated in full.  That's really the investor's problem, though, and could be alleviated a bit if Lendy were to give advance notice that they were going to do that for oversubscribed tranches in loans where parts are available via the SM.

However, as has been mentioned by others, I think the real reason SS can't do that is the FCA not wanting platforms to hold loan parts for their own account, even temporarily.  (I don't think it really would matter whether the money to buy the SM parts came from the client account or the platform's working capital because AIUI the FCA's concern is the risk associated with the parts.)  They might be allowed to use underwriters' funds, but that probably would be more expensive than it is worth to the platform.

"Latest Independent Monitoring Surveying Report received and next development drawdown due this week. Plots 1-4 are progressing well. However, an extension to term will be required in order to finish the remaining units. Updated valuation instructed in order to consider the request further."

So if the updated valuation is not satisfactory L will not grant an extension? Do they have a choice? i.e. the loan will not be repaid in 35 days regardless.

Thanks

1. Yes
2. Not necessarily, but it's already at 70%, so no leeway to advance further money without additional security. However last time I checked Rightmove few or none had sold as there an incentive for the first four that reserve, which seems that it is unlikely to meet the full valuation, and could been months away from repayment, by which time the extra interest due may not be fully covered.
3. Unknown, but if the developer has additional reserves and/or security that would be comforting. I think capital loss is unlikely, but interest after 90 days is very much at risk.

PS. For lottery just pm me the numbers!

In loans of this type, where progressive sales can occur (rather than all or nothing to one person or company) it would be helpful to us (and prudent for Lendy) to keep themselves up to speed with the progress on site and number of house sales (houses in this case, holiday lodges in other cases). If things are going wrong on site or if there is insufficient sales progress then Lendy should step in at an early stage and nudge the borrower to get the project back on track before matters become serious.

It may be a matter of poor building works supervision, lack of management on site, lack of a good sales agent or a combination of factors. But we need to see sales.

I am not convinced Lendy is very good at doing this - and certainly they have been less than adequate at communicating with lenders via meaningful updates. This could have an impact even upon the founding partners of Lendy - they need to be aware that all eyes are on their performance as managers of the platform, and in the internet age, eyes have a long reach.

There has been an example recently on another P2P platform where the platform stepped in to take some element of control of a large project to help steer it towards what we hope will be a more successful conclusion for all parties.

Wake up Lendy - the world is watching.

0.5% bonus kicked in today on this loan. It will pay 12.5% for the next 30 days (assuming no repayment or term extension suddenly appears).