micky
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Post by micky on Sept 15, 2017 7:48:32 GMT
PF should ensure no capital loss but I can't see any accrued interest or bonus being paid.
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Post by loftankerman on Sept 15, 2017 8:06:26 GMT
Page 1 of this thread makes excellent reading now, unless you have money in the loan.
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seeingred
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Post by seeingred on Sept 15, 2017 8:06:55 GMT
Is this some sort of dream world?
A valuation of a domestic property in an expensive area by Aztec Valuers for £1,785,000
An aborted auction for £1,290,000
And now sold for a measly £1 million - less fees of course. How much will actually come back to the platform? Are we allowed to know? We'll be lucky to see 50% of the purported valuation figure.
This is making P2P property valuations look like a comedy act. And I understand it is not the first time - look at the garden centre and the tin shed in Somerset.
is it time maybe to start to collate data with a view to publishing some of these valuations and the achieved figures?
Lest we forget.
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r1200gs
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Post by r1200gs on Sept 15, 2017 12:29:32 GMT
Thanks. I've not been following all the goings on with Lendy. Do you happen to know how long it'll likely be before we see the principal back in our accounts? Are we talking a couple of weeks or more like 9 months? Precedent says (and this LY we're talking about, so could easily change) that the capital (including any shortfall) will pay out when the auction purchase completes (which can take up to a month; any more and it would be a sign there are issues). The PF won't cover the accrued interest, which LY will probably claim will be chased through other avenues (PG etc) but realistically there is little chance of any further recoveries Agreed, very little chance of further recoveries. I suspect though that we'll be strung along for quite a while before that's admitted, jam tomorrow. After costs, this is likely going to net around 50 percent of the valuation used to justify the loan. This isn't the first time and it's not restricted to Lendy, but I hope nobody is left in any doubt regarding these valuations. They are almost always ludicrously optimistic.
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Post by mrclondon on Sept 15, 2017 15:33:09 GMT
I thought it might be worth pasting into this thread a post I made last month on the Property Valuations thread on this board. The £1m auction sale price equates to £3077 per sqm which is WAY down on the listed comparables which ranged £4000-£5800 per sqm. Its hard to know what conclusion to draw at present, other than distressed sale prices can bear little relation to OMV. (Clearly my "worst case" assumptions were overly optimistic  ) This knotty subject has probably been aired elsewhere but I would like to mention it regarding Lendy. At the moment a particular loan has caught my eye, PBL123. This loan has a value attributed to it of £1,785,000 but it is advertised for a forthcoming auction with an estimate of £1,300,000. It did not reach its reserve price in a previous auction. Was this property significantly overvalued by the agent? Is this a real change in the value since last year? In general, how can investors be sure that properties have been valued correctly? The valuation of one off properties is not easy, and will to an extent be swayed by the personal taste of the individual valuer. However, looking at my notes from last year I felt this was probably slightly over valued. It is c. 325 sqm so has been valued at £5500 / sqm with a 10% reduction for quick sale. Para 16.5 states "The external space is however limited and this may deter some families in addition to which the proximity of P*** Road may also be a deterrent." The comparables (VR section 16.3 & 16.4) vary from c. £4000 / sqm for the 2 largest properties, to one at £4400 / sqm and the remainder £5500 to £5800 / sqm. Valuing solely on sqm / sqft is not reliable and fails to take into account issues like minimal grounds (not good at this price range) and the fact that there are limited people even in the SE that can afford £1.5m+ properties. Valuing this one at £5500 / sqm in line with the bulk of the comparables given the lack of grounds seemed to me to be a tad optimistic, but the valuer may not enjoy gardening ! I worked on £5000 / sqm = £1,625,000 as a more realistic OMV (71% LTV), and then knocked 20% off to achieve a quick sale = £1,300,000 (which is the value you are reporting as the current auction estimate, and equates to £4000 / sqm) The loan value of £1,160,250 was 90% LTV of my worse case estimate so even with recovery fees I felt a full recovery would be possible so I was in. (Although I sold on the SM at some point to switch to something else on the platform). Although I don't shout it too loudly on here, I'm as much a sceptic on valuation reports as ozboy . However, this VR doesn't seem to me to be that far adrift of reality given the subjective nature of the game, but a 10% reduction for quick sale is too low although that may be a fixed value for this firm of surveyors. The key here is a valuation report is a subjective opinion of one person on one particular day. It is up to each lender to study the report, and in conjunction with additional internet research to form their own view of a worse case value for the asset in a fire sale situation. |
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peteuk
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Post by peteuk on Sept 15, 2017 17:41:41 GMT
On another note! It seems that everyone is of the opinion that the PF will take up the slack, if they did, the PF would soon run out of money, about two years ago lendy came out with a formula on how they would pay out does anyone other than me remember what it was, all i can remember is that they would effectively lower the LTV by a percentage on the loan ,What say you!.
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micky
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Post by micky on Sept 15, 2017 17:53:40 GMT
Lendy seem okay with using the PF as they need too-
15/09/2017
'The property was sold at auction on 14 September 2017 for the sum of £1,000,000 and we will now be pursuing the borrower for the residual debt outstanding. Where the property sold for less than the capital sum, Lendy intends to make payment of the shortfall from its provision fund. All accrued interest and bonus accrual payments will only be payable on successful enforcement action being taken. In light of the fact that the property sold for less than the original value provided, we will be reviewing this with our professional advisors.'
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GeorgeT
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Post by GeorgeT on Sept 15, 2017 18:04:56 GMT
So they've cost the PF £290,000 by not selling it last month. When the reserve was £1.3m, and it was only £10k off (or 0.76% below reserve), that was madness. It's clear the economy is worsening, bank rate rise quite near etc.
Investors will get all their capital back but don't expect any interest.
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Post by GSV3MIaC on Sept 15, 2017 18:55:01 GMT
"(otherwise it's a crash!)"
I see a tin shed that resembles that remark! Oh, and maybe the incomplete development in Exeter where the off-plan buyer 'can decide on the height of their roof'.
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GeorgeT
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Post by GeorgeT on Sept 16, 2017 20:55:35 GMT
So basically LY lent £1.16 million to the borrower and then repossessed the property and sold it for £1.0 million.
Sounds like a great bit of business .....
But could be nothing compared with the deal that the man with the tin shed ends up getting. But then probably not because as LY have told us, the background of the borrower is immaterial.
This doesn't sound like a sustainable business model to me.
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oldgrumpy
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Post by oldgrumpy on Sept 17, 2017 13:32:00 GMT
So basically LY lent £1.16 million to the borrower and then repossessed the property and sold it for £1.0 million. Sounds like a great bit of business ..... But could be nothing compared with the deal that the man with the tin shed ends up getting. But then probably not because as LY have told us, the background of the borrower is immaterial.This doesn't sound like a sustainable business model to me. I'm quite sure LY would also tell us, if asked, that the background of the lending platform is material. I would wholeheartedly agree with them.
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micky
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Post by micky on Oct 11, 2017 16:29:22 GMT
Capital just repaid.
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btc
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Post by btc on Oct 11, 2017 16:36:20 GMT
at least £1,160,250....... will probably be leaving lendy today
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Post by lendinglawyer on Oct 11, 2017 16:40:39 GMT
All these default repayments and yet still my £5.99 is stuck across 6 defaults. Get your act together, Lendy Support !!! (Jokes - I am pleased to see another default resolved, although query how much the PF was used given the reference to interest only being paid on successful enforcement, which implies capital was topped up out of PF as enforcement is not complete...) Edit: Just seen 15/09 update from Lendy, quoted below, which I looked at in light of @new2p2p 's post below. I hadn't been following this loan very closely as I was never in it. It's quite a big dip in valuation, etc., and while I know property valuations have suffered since Brexit, the election, etc., this was a distressed sale at auction, etc., to wipe the best part of 40% off the 90 day marketing period value seems ... excessive ... I would also like to know whether the PF is "re-topped up" if successful enforcement action recovers at least accrued interest and bonuses and PF shortfall. I'm not sure any loan has got to true enforcement in this way, so be interesting to keep an eye on over the next few months. Even if Lendy probably hope everyone forgets about it once they get their capital back and the loan successfully transitions to the "repaid" tab - IMO there should be a "partially repaid" tab where loans are still in enforcement proceedings for outstanding interest etc. |
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dovap
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Post by dovap on Oct 11, 2017 16:52:37 GMT
ah well - guess the property investment plans of the
borrower went as well as some of her other ventures.
ho hum
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