hendragon
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Post by hendragon on Jul 22, 2016 15:50:26 GMT
The recent update from FS was that the painting has been sold at auction, and that settlement would be within 35 days. Interestingly they also state that interest will accrue until payment is made. I seem to recall that when the Grand Piano was sold at auction that FS stated that they were obliged to settle with the borrower when the sale was made and interest would not accrue to lenders whilst payment from the auction was awaited. I am interested as to why there should be this difference.
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mikes1531
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Post by mikes1531 on Jul 22, 2016 17:58:32 GMT
Perhaps different auction houses have different policies.
Or perhaps FS realise how having money tied up earning nothing really puts investors off. (That's got to have been a factor influencing FS's recent decision to start paying interest on investments as soon as they are made.)
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Post by fundingsecure on Jul 25, 2016 11:37:41 GMT
Thank you for the question. The reason why interest continues to accrue is that the circumstances are entirely different. In a default situation, FS sells the asset at which point the debt is considered to have been settled and interest can no longer be applied. In this case, it is not a default situation. The borrower is selling the painting to pay off the debt. Therefore the debt continues until repaid. I hope that clarifies.
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