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Post by masquedefer on Aug 6, 2017 11:45:29 GMT
@ Paul, Ly
Given the high likelihood that DFL projects overrun on time and/or cost. I suggest that on all future DFLs Lendy require from the borrower a verifiable plan of how they will finance any extra interest payments (delays) and/or raise extra secured capital (cost overrun).
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Liz
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Post by Liz on Aug 6, 2017 12:39:04 GMT
... Let's say they need another £1m and need to keep the existing funding for 12 months. Assuming total interest rate of 20% on current borrowing(inc. default interest & lendy's fee). Total borrowing £7m vs £8.6m GDV, already gives an 80%+ LTV. But factor in the interest due on loan 1 and: Total borrowing £7m+£1.2m vs £8.6m, gives LTV of 95%+. That 95% LTV assumes everything runs smoothly; and sales will need to exceed £8.4m after selling costs for the 2nd charge to just receive capital back, with little chance of full interest, so the 18% or even 25% would be irrelevant. The above figures are of course just an example and not based on any fact. Let's tweak that slightly and not allow for any further interest to the original investors. This may seem harsh, but the cold reality is that they aren't likely to get any interest that's currently accruing anyway, and if the borrower fails to attain alternative finance (and you may wonder who would touch this given Lendy are themselves typically a lender of last recourse) then even capital repayment is doubtful given a partially completed development site may sell for less than 50% of its' perceived value. I doubt the PF would cope with a shortfall running into millions. So, taking the extra £1m - which would provide c. £800k to finish the build and we get a total loan facility of £7m. The ten properties would have to sell at c. £725-£750k to comfortably cover costs and if they were to do so then existing (charge 1) investors could be partially repaid capital as each unit sold and charge 2 investors repaid on sale of the final unit. Any residual profit from the project could then be paid to the initial charge 1 investors as part-payment against accrued interest. All very speculative and even idealistic, of course. Problem is that we have no idea how much further funding this would require to see it through to completion nor indeed whether Lendy have explored how the " Build costs of £3,700,000 (fixed JCT contract with large, successful, local firm. Very experienced) " as mentioned in the original loan description have been allowed to slip so badly. Given that was for all 10 executive homes, it's a poor show that not even four have been completed even though they have been the primary focus since early March and since which £525k in further funding has been provided. Thanks to a lack of meaningful quantitative and qualitative updates, facts are very thin on the ground. Your sarcasm just shows how low your intellect is, so I have blocked you won't bother to read any of your posts.
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littleoldlady
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Post by littleoldlady on Aug 6, 2017 14:03:13 GMT
I don't think it is a worthwhile exercise quoting large figures without knowing exactly what stage each property has reached. ....... Hopefully the response on this thread will show Lendy we want to see this project completed not put into receivership but Lendy has the final say. To be fair I think it is clear in all the suggestions put forward that the figures are merely indicative in order to show the suggestion with a worked example which is usually easier to understand. I agree with your final statement.
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Post by Paul64 on Aug 8, 2017 16:35:08 GMT
Hi all, this is a very complicated loan, so please give me until the end of the week for me to respond. Paul
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izigor
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Post by izigor on Aug 10, 2017 4:46:33 GMT
Hi all, this is a very complicated loan, so please give me until the end of the week for me to respond. Paul "complicated" indeed, I think we've worked that part out. Personally, from what I understand so far "buggered" would be the adjective I would choose but then I'd probably be describing my mood rather than the loan itself. Looking forward to your update on this, thanks for the effort.
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spyrogyra
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Post by spyrogyra on Aug 10, 2017 8:08:04 GMT
Paul, the next (fair) step is to confess that part of the "complication" is due to Lendy's carelessness in monitoring the progress of the build.
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guff
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Post by guff on Aug 10, 2017 8:40:55 GMT
My preference would be to see Lendy expend all their time and efforts into (further) investigating active ways to progress the build and bring the project to a successful conclusion for, as far as is possible, the benefit of all parties. Time for inquisitions, confessions and attrition (or root cause analysis and lessons learned, if you prefer) when the remedial activities are complete. Indeed. It's just a shame that the whole lot has just slipped a week to the right with no progress.
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kaya
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Post by kaya on Aug 10, 2017 8:43:27 GMT
Aye, but just watch that sarcasm now!  (even my ingrained Scottish Glaswegian sarcasm can't get that one). |
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Liz
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Post by Liz on Aug 10, 2017 21:11:34 GMT
Lendy Support , Paul64 I like to remind you of something LY (then SS) said when they started to offer DFLs (see HERE) - in fact, the Q&A session at the time was directly related to DFL001 & DFL002; some investors may have invested with these in mind. I do know that the company involved has not gone bust, but I do believe that the text in red is particularly of interest when we look at the situation with DFL001 Didn't they also say they "intended" to top-up the PF after it was called upon?
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Post by mrclondon on Aug 11, 2017 8:34:32 GMT
Lendy Support , Paul64 I like to remind you of something LY (then SS) said when they started to offer DFLs (see HERE) - in fact, the Q&A session at the time was directly related to DFL001 & DFL002; some investors may have invested with these in mind. I do know that the company involved has not gone bust, but I do believe that the text in red is particularly of interest when we look at the situation with DFL001 A read of chapter 7.6 "Finishing Incomplete Real Estate Developments" from the book "Optimising Distressed Loan Books: Practical solutions for dealing with non-performing loans" by John Michael Sheehan is recommended. Most of the chapter (minus a couple of pages) can be read via google preview
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Jeepers
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Post by Jeepers on Aug 11, 2017 11:22:43 GMT
Hi all, this is a very complicated loan, so please give me until the end of the week for me to respond. Paul Just the usual film flam this week then? No update on this loan?
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Post by Paul64 on Aug 11, 2017 12:06:49 GMT
Hi Jeepers, as per our Weekly Update schedule since January this year, this week's update was pipeline, and full loan book next week (we alternate). I will however come back to the forum later today with an update on DFL001 as promised. Paul64 Lendy Support |
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Post by Paul64 on Aug 11, 2017 15:29:33 GMT
All, as of today, the borrower has so far failed to provide details of the proposed refinance offer. We are therefore in discussions with our solicitors and formulating our recovery plan. Lendy Support |
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Balder
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Post by Balder on Aug 11, 2017 15:38:28 GMT
All, as of today, the borrower has so far failed to provide details of the proposed refinance offer. We are therefore in discussions with our solicitors and formulating our recovery plan. Lendy Support is that the update you promised earlier in the week for this "complicated" loan. If so what a cop out you haven't answered any of the question put to you!
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GeorgeT
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Post by GeorgeT on Aug 11, 2017 16:07:15 GMT
Don't shoot the messenger. I was impressed by Paul at Cowes Week - it was good to hear him speak.
I guess LY will have to take the advice of Receivers. It doesn't sound over-hopeful of bringing this to a satisfactory conclusion by agreement.
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(even my ingrained Scottish Glaswegian sarcasm can't get that one).
