ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 12, 2016 10:00:13 GMT
Is there anyway to know the loan term before launch? its shown on the particulars tab on loan page though this has been found to not always be accurate in the case of 1yr loans. Several have subsequently turned out to be only 6 months. Theyve been more accurate recently. This one is supposedly a year
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dp
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Post by dp on Apr 12, 2016 10:00:15 GMT
Is there anyway to know the loan term before launch? Look on the loan and then PARTICULARS. 1 Month - 365 days
Doesn't all loan say this? and still doesn't answer the question?
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SteveT
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Post by SteveT on Apr 12, 2016 10:02:16 GMT
Look on the loan and then PARTICULARS. 1 Month - 365 days
Doesn't all loan say this? and still doesn't answer the question?
Recent new loans have specified 183 days on occasions, so I guess the assumption has to be that interest will be retained to cover 12 months. 1 month is the minimum term for early repayment.
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Post by dodgeydave on Apr 12, 2016 10:04:22 GMT
It is only a guide.
Look at how many loans are paid early versus those that over run.
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 12, 2016 10:06:27 GMT
Am I looking at the wrong data or have things changed in the past week or so? On the pipiline I read: PBL 91 - Public house conversion to residential, Emsworth Value: 435k (was it 300k?) Loan: 304k (was it 210k?) It also seems the valutation document has been messed up totally. The Valuation Date is reported as 6 March 2016 (the original one), but the report starts with "Instructions. On 4 April 2016 you requested....". Furthermore: a) the GDV table include finance calculated at 8% (less than half paid here). This should be revised. b) We are lending this guy more than he paid for the whole place initially (he paid 290k, we lend 304k??). This looks crazy to me. The security is too weak compared to current market prices. What SS is lending (304k) correspond to: 93,5% of the marketed-initially requested price 105% of the market price really paid few months ago. This looks to me too far from the Prudential 70% max LTV SS has set for the network. I have put to zero all my prefunding, at least until I understand what is going on. I hate when things suddenly change with no reason and no explanation. It would have been much better to have a second document explaining what new facts have been considered... They got planning on the site in the past week. The valuation thus increased, we lend against the valuation. description needs updating as still says seeking planning also says will covert into a DFL once planning gained but I assume this loan is still the original version. Few of these descriptions need revisiting eg DFL2 which still says more details to follow & close to completion. Highlighted through q&a but q completely ignored 
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 12, 2016 10:10:48 GMT
Look on the loan and then PARTICULARS. 1 Month - 365 days
Doesn't all loan say this? and still doesn't answer the question?
In that case, strictly speaking for all the reasons posted. No
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SteveT
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Post by SteveT on Apr 12, 2016 10:20:46 GMT
Now live. £295 allocation. 1248 investors
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Post by Deleted on Apr 12, 2016 12:01:37 GMT
very upset, asked for £300 only got £295, blast  |
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 12, 2016 12:13:35 GMT
Further to the earlier discussion of loan terms. Anybody else noticed that the term field in the particulars now mirrors the time remaining so you cant see what the original term was unless it is contained in the description.
PBL60 is another one with uncertainty, 12 month term which ties in with the time remaining, yet has received a 3 month extension. So is 12+3, 6+3 and the time remaining is wrong. Ive asked the Q and for clarification on the additional 200k referred to in todays update.
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Post by Deleted on Apr 12, 2016 12:47:18 GMT
They got planning on the site in the past week. The valuation thus increased, we lend against the valuation. I haven't followed very much the development finance loans (DFL), so have to ask the question. The property was bought few weeks ago for 290k and then very quickly got a planning permission for a transformation. Assume the borrower dies/goes out of business/out of the country (for separate and independent reasons) just a few days after getting the SS money, what do we have in hand as a security and how could we use it? If SS tried to sell it on the open market (before any serious work had commenced on it), do you really expect it to get to +50% on its market price of few weeks ago (290+50%=435k)? I cannot believe a planning permission can push the property value instantly of +50% (and if it does you should ask why the previous owner did not do it before selling it...).
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mikes1531
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Post by mikes1531 on Apr 12, 2016 14:21:43 GMT
It is only a guide. Look at how many loans are paid early versus those that over run. I accept it's only a guide, and I have no problem with early repayments. Bridging loans are like that. But the important issue for me is knowing how much interest was retained when the loan was made. If the stated term and the time remaining accurately reflect the retained interest then I'm happy. What I don't want to do is invest in a '12-month' loan and find out seven months later that only six months' worth of interest was retained, so I won't be receiving any interest on the loan that month -- or at any time -- until either the borrower coughs up more interest or repays the loan in full, including the accrued interest. Under the old Ts&Cs, this didn't make any real difference because SS/Lendy were committed to paying the interest whether or not the borrower did. The new Ts&Cs are very different, and if SS/Lendy haven't received the interest from the borrower then there will be nothing passed along to SS investors.  There is a significant shortcoming with SS Loan Particulars in that they are very short of dates, so it's impossible to tell when a loan first was offered to investors, and when it drew down. If the remaining time shown on a loan is accurate, and indicates when the prepaid interest will be completely used up, then that would be good, but ISTM that there have been a number of cases where a loan has been extended and SS haven't made it clear whether or not additional interest was received from the borrower. Hopefully there will be fewer such cases in the future as that is critical info to know when operating under the new Ts&Cs.
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Liz
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Post by Liz on Apr 12, 2016 14:22:51 GMT
They got planning on the site in the past week. The valuation thus increased, we lend against the valuation. I haven't followed very much the development finance loans (DFL), so have to ask the question. The property was bought few weeks ago for 290k and then very quickly got a planning permission for a transformation. Assume the borrower dies/goes out of business/out of the country (for separate and independent reasons) just a few days after getting the SS money, what do we have in hand as a security and how could we use it? If SS tried to sell it on the open market (before any serious work had commenced on it), do you really expect it to get to +50% on its market price of few weeks ago (290+50%=435k)? I cannot believe a planning permission can push the property value instantly of +50% (and if it does you should ask why the previous owner did not do it before selling it...). We don't need 435k omv to get our money back. I will take the 290k and 14.5k from the provision fund, worst case.
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mikes1531
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Post by mikes1531 on Apr 12, 2016 14:30:40 GMT
Further to the earlier discussion of loan terms. Anybody else noticed that the term field in the particulars now mirrors the time remaining so you cant see what the original term was unless it is contained in the description. We'll need to keep our eyes on PBL090. Its remaining time has been decreasing while waiting for the sale to complete, and is down to 171 days today. Yesterday's update indicates that completion is expected today, so the question is whether the time remaining reverts to 183 days upon completion or continues to decrease. In short, does the six-month term of this loan start when it was offered to investors or when it draws down?
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littleoldlady
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Post by littleoldlady on Apr 12, 2016 14:47:56 GMT
I cannot believe a planning permission can push the property value instantly of +50% (and if it does you should ask why the previous owner did not do it before selling it...). Planning can increase values much more than that. Agricultural land valued at £5k per acre can be worth £1m an acre overnight in an extreme case. As to why the previous owner did not do it there is little I can say on a public forum but the fact is that in the majority of cases where there is a dramatic change of use it is a developer that obtains it. Obtaining planning consent is a skill that professionals may have when amateurs don't.
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mikes1531
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Post by mikes1531 on Apr 12, 2016 14:51:10 GMT
I haven't followed very much the development finance loans (DFL), so have to ask the question. The property was bought few weeks ago for 290k and then very quickly got a planning permission for a transformation. Assume the borrower dies/goes out of business/out of the country (for separate and independent reasons) just a few days after getting the SS money, what do we have in hand as a security and how could we use it? If SS tried to sell it on the open market (before any serious work had commenced on it), do you really expect it to get to +50% on its market price of few weeks ago (290+50%=435k)? We don't need 435k omv to get our money back. I will take the 290k and 14.5k from the provision fund, worst case. : The cost of appointing LPA receivers to take possession of the property, and legal fees and agents' fees to complete the sale, are significant, so the 'worst case' claim from the PF will be a lot greater than just £14.5k. And if the recovery process were to drag on past the point to which prepaid interest was retained -- the recovery process generally is not fast -- there'd be accrued interest and SS/Lendy fees to add to the claim as well. Then we'd have to hope the PF Trustees' use their discretion and meet the claim in full. We also need to recognise that, because of the retained interest, unless SS/Lendy are monitoring the property and the borrower closely, it may not be clear that the borrower is going to default until the loan is near maturity. And we might not find out until then whether or not the refurbishment work is complete. Or, for that matter, even started. (Unfortunately, AC have a 'good' example of what can go wrong in a situation such as this in receivership now.)
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