phil
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Post by phil on Jun 26, 2016 20:20:03 GMT
Two loans placed on the platform this weekend, the reaction by investors has me somewhat baffled. Both properties require some refurbishment. The Princes Risborough property has equity of some £155k and Oldham has £20k. On a 90 day sale basis equity is £130k and £12,500. Princes Risborough is an area that many people aspire to and is in high demand but Oldham is just, well, Oldham. The Oldham property has been purchased this year by the borrower yet the valuer was unable to ascertain the purchase price, knowledge of this year's purchase price may help investors decide if the £50k valuation is reasonable. What has me a little baffled is that Princes Risborough has achieved £13,250 in funding since yesterday morning (34 hours online) yet Oldham has nearly £11,000 since been placed online just 10 hours ago. I have a spare £1k in my account that I want to invest in a non-development loan so either of these fit the bill, usually I'd diversify and stick £500 in each but surely with a choice between a £130k or £12,500 equity on a 90 day sale the Princes Risborough property is a no brainer?
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baldpate
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Post by baldpate on Jun 26, 2016 21:07:13 GMT
Might it have to do with the fact that Princes Risborough is a 2nd charge at overall LTV 68%, whereas the Oldham is a 1st charge at (if you accept the valuation) 60%? Also, consider that Oldham is a smaller loan and could fill (and so start earning interest for lenders) quite quickly - much sooner that PR; in the current slow-motion market this could be an important consideration for investors.
Not that I'm in any rush to invest in either of these loans at 12%
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phil
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Post by phil on Jun 26, 2016 21:33:46 GMT
Good points that I overlooked.
Talking of investing in loans at 12% I see we have a 14% Liverpool loan going online in the morning. Google *Lot **** - ** S*****n Lane, Liverpool* and read the first few results. I'm trying to work out what appears to be a discrepancy in both the value and rents. Gives a total floor area of some 404 sqm though unclear if it includes the two apartments. The FS valuation doesn't seem to state total floor area.
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Post by Deleted on Jun 27, 2016 6:50:04 GMT
market demand in Oldham and Princes Risborough, is of course, a big fat 0.
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jamesc
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Post by jamesc on Jun 27, 2016 17:09:05 GMT
If you are still looking at these two then the no brainer is Newry 12% LTV at 12% but going fast.
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rogerthat
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Post by rogerthat on Feb 9, 2018 11:12:50 GMT
Found an old thread
Any comment on this Princes Risborough renewal..wonder whether there is any binding agreement that the property will be sold if the loan is not paid off first ?
Why has the value increased ?...its generally situated in a desirable area...why hasn't it filled quickly ?
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steve11523
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Post by steve11523 on Feb 9, 2018 11:54:07 GMT
Although I'm not keen on second charges, I put a small amount in since it seems an ok property in a good area and should be sellable at someone well in excess of both loans.
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rogerthat
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Post by rogerthat on Feb 9, 2018 12:04:32 GMT
Although I'm not keen on second charges, I put a small amount in since it seems an ok property in a good area and should be sellable at someone well in excess of both loans. I noticed the 'new' valuation still listed that it is in need of cosmetic updating...I thought that was the findings on the last one. Secondly the comment about the borrower selling after a month of this loan isn't binding. I didn't manually renew my old holdings and I'm hesitant atm in putting any more in..but if I do it wont be as much as before
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Post by mrclondon on Aug 29, 2018 22:47:37 GMT
Well as it happens this one isn't in Princes Risborough itself, but the quieter Monks Risborough immediately to the north. The property is on a quiet side street of similiar (as well as larger) properties a short walk from a pictureseque church and a silightly odd prefab "church hall". No off road parking is the obvious draw back, but it feels as if there will always be demand for it even with any cosmetic issues. The roofs in the street are a mixture of thatch and red tiles, indeed the other half of this semi is red tiled, so there is presumably no necessity to re-thatch when it needs renewal. The local station has an hourly service to Marylebone.
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Post by multiaccountmanager on Feb 10, 2019 20:59:34 GMT
This is due for renewal today.
I have a little invested here from the secondary market and am fairly new to FS platform.
What can be expected to happen now?
This loan has rolled over since 2016 and it doesnt appear a serious effort to "must sell" has taken place.
Now it is at 67% LTV so looks as if the borrower will have to stump up the interest if he can or try harder to sell.
I am a bit alarmed by some of the posts on other threads where it seems there is not much regard for FS management being active??
On the other hand there is none of this loan now available on the SM so do people think is safe?
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Post by mrclondon on Feb 10, 2019 21:22:07 GMT
This is due for renewal today. I have a little invested here from the secondary market and am fairly new to FS platform. What can be expected to happen now? This loan has rolled over since 2016 and it doesnt appear a serious effort to "must sell" has taken place. Now it is at 67% LTV so looks as if the borrower will have to stump up the interest if he can or try harder to sell. I am a bit alarmed by some of the posts on other threads where it seems there is not much regard for FS management being active?? On the other hand there is none of this loan now available on the SM so do people think is safe? Sales on the SM are suspended automatically by FS at 30 days prior to the renewal date. However, that said, there was a reasonably high trade in parts of this loan prior to the cut off.
As far as I know the borrower lives in this property, and is not intending selling it. Its a second charge loan (with the 1st charge probably held by a bank / building society for a standard mortgage). There are any number of reasons why the borrower might have wanted to raise extra funds, and why a high cost financer such as FS was the best option at the time and apparently remains the best option.
As to what happens next ... FS wll have sent / will send polite reminders to the borrower that renewal is due, and probably at some point in the next month or two the borrower will send the interest due since the last renewal to enable him to renew for another six months.
The value on which LTV's are based is only an indication of what a property might be worth on a good day with a queue of intersted buyers. If it had to be auctioned it might sell for less than the loan value .... the risk judgement you as a lender have to make is what you feel the worst case re-sale value would be if the asset had to be auctioned (and bear in mind the cost of sale of the asset could amount to tens if not hundreds of thousands of pounds if legal action to evict the borrower were to be required). If you are unable to form a view of the risk of capital loss on specific p2p loans then p2p investments may not be appropriate for you.
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Post by df on Feb 11, 2019 4:02:43 GMT
This is due for renewal today. I have a little invested here from the secondary market and am fairly new to FS platform. What can be expected to happen now? This loan has rolled over since 2016 and it doesnt appear a serious effort to "must sell" has taken place. Now it is at 67% LTV so looks as if the borrower will have to stump up the interest if he can or try harder to sell. I am a bit alarmed by some of the posts on other threads where it seems there is not much regard for FS management being active?? On the other hand there is none of this loan now available on the SM so do people think is safe? Sales on the SM are suspended automatically by FS at 30 days prior to the renewal date. However, that said, there was a reasonably high trade in parts of this loan prior to the cut off.
As far as I know the borrower lives in this property, and is not intending selling it. Its a second charge loan (with the 1st charge probably held by a bank / building society for a standard mortgage). There are any number of reasons why the borrower might have wanted to raise extra funds, and why a high cost financer such as FS was the best option at the time and apparently remains the best option.
As to what happens next ... FS wll have sent / will send polite reminders to the borrower that renewal is due, and probably at some point in the next month or two the borrower will send the interest due since the last renewal to enable him to renew for another six months.
The value on which LTV's are based is only an indication of what a property might be worth on a good day with a queue of intersted buyers. If it had to be auctioned it might sell for less than the loan value .... the risk judgement you as a lender have to make is what you feel the worst case re-sale value would be if the asset had to be auctioned (and bear in mind the cost of sale of the asset could amount to tens if not hundreds of thousands of pounds if legal action to evict the borrower were to be required). If you are unable to form a view of the risk of capital loss on specific p2p loans then p2p investments may not be appropriate for you.
True for some p2p investments, but those who invest in pawn on FS don't have much chance to form a view... More appropriate could be to use p2p platforms/accounts that deliver stable returns at lower rates. I think this is a direction p2p is going. Whilst FS and alike are struggling to fill loans, LW has 1 month queue to get invested and RS has no shortage of enthusiasm from investors.
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michaelc
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Post by michaelc on Feb 11, 2019 8:19:56 GMT
Good advice for new investors but just because someone is new to fs doesn't mean they are new to investing or p2p.
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Post by multiaccountmanager on Feb 11, 2019 16:02:12 GMT
Sales on the SM are suspended automatically by FS at 30 days prior to the renewal date. However, that said, there was a reasonably high trade in parts of this loan prior to the cut off.
As far as I know the borrower lives in this property, and is not intending selling it. Its a second charge loan (with the 1st charge probably held by a bank / building society for a standard mortgage). There are any number of reasons why the borrower might have wanted to raise extra funds, and why a high cost financer such as FS was the best option at the time and apparently remains the best option.
As to what happens next ... FS wll have sent / will send polite reminders to the borrower that renewal is due, and probably at some point in the next month or two the borrower will send the interest due since the last renewal to enable him to renew for another six months.
The value on which LTV's are based is only an indication of what a property might be worth on a good day with a queue of intersted buyers. If it had to be auctioned it might sell for less than the loan value .... the risk judgement you as a lender have to make is what you feel the worst case re-sale value would be if the asset had to be auctioned (and bear in mind the cost of sale of the asset could amount to tens if not hundreds of thousands of pounds if legal action to evict the borrower were to be required). If you are unable to form a view of the risk of capital loss on specific p2p loans then p2p investments may not be appropriate for you.
True for some p2p investments, but those who invest in pawn on FS don't have much chance to form a view... More appropriate could be to use p2p platforms/accounts that deliver stable returns at lower rates. I think this is a direction p2p is going. Whilst FS and alike are struggling to fill loans, LW has 1 month queue to get invested and RS has no shortage of enthusiasm from investors. Thank you for the information regarding the 30 day renewal SM cut off. I have a six figure P2P portfolio but am starting out on FS cautiously. How do you know that 1 the borrower lives there 2 He has no intention of selling. If the latter is true, why do FS have a loan update about a sale falling through? Yes I am very aware that distress sales at auction can generate low values, especially in today's market with Brexit uncertainty. Thank you again, especially for your report on the local neighbourhood. Where is parking available for the owner and visitors? Yes a significant issue. PS I think RS suffers from the old problem of borrowing short to lend long which is a major structural risk. Also all recent platform changes have reduced flexibility and attraction.
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sarahcount
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Post by sarahcount on Feb 11, 2019 20:49:59 GMT
Another update from FS that shows teeth and a reluctance to blindly accept borrower sob stories.
Go new improved FS! Take no prisoners.
(Loan always had too large a first charge in front of it for my taste but FS still confident that investors shouldn't suffer a loss)
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