mack
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Post by mack on Aug 10, 2016 0:46:05 GMT
Some good sleuthing there, meledor , thanks. I agree it seems unlikely that the borrower would go to the trouble of getting PP if there wasn't some agreement in place with the previous owner, especially given the borrower's pre-purchase involvement. But rather than having to infer this, I think it is perfectly reasonable for savingstream to provide us with confirmation that such an option to buy was indeed in place and that it explains the difference in purchase price of £2,885,000 in 2015 and SS's market valuation of £5,000,000 in 2016.
Why? It sounds like you expect SS to not only offer you the chance to invest in the loan but do your DD for you.
Remember it wasn't too long ago that we didn't get to know the identity of the borrower. Now apparently SS, according to some, need to check that the borrower meets an as-yet-unspecified ethical checklist, and also disclose the commercial (and possibly confidential) arrangements the borrower made with the previous owner of the property.
Are you serious? Saving Stream markets to the general public, allows investors to invest in pence rather than minimums of thousands and requires no verification that investors are "sophisticated" as required by the FCA for high risk investments. You damn right they better do the DD rather than the investors or they need to market it to a completely different type of investor.
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Post by meledor on Aug 10, 2016 6:37:18 GMT
Why? It sounds like you expect SS to not only offer you the chance to invest in the loan but do your DD for you.
Remember it wasn't too long ago that we didn't get to know the identity of the borrower. Now apparently SS, according to some, need to check that the borrower meets an as-yet-unspecified ethical checklist, and also disclose the commercial (and possibly confidential) arrangements the borrower made with the previous owner of the property.
Are you serious? Saving Stream markets to the general public, allows investors to invest in pence rather than minimums of thousands and requires no verification that investors are "sophisticated" as required by the FCA for high risk investments. You damn right they better do the DD rather than the investors or they need to market it to a completely different type of investor.
If you are not prepared to do any DD and want it all on a plate then I humbly suggest you would be better of putting your money in the building society. You cannot expect to earn 12% p.a. without some work on your part and a recognition of the risk arising from a greater degree of uncertainty than would apply to investments with lower returns.
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SteveT
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Post by SteveT on Aug 10, 2016 7:01:17 GMT
I suspect it will also put off the BHs who will move onto platforms where they face fewer restrictions. This was a £3m loan and every BH got what they asked for (with £500k or so remaining), so filling bottom-up made no difference. Above that sort of level, BHs have pretty much always got what they ask for. So the only difference it makes is in the £1m-£3m bracket, where SS haven't really struggled to fill loans for a long time. If your point is that, if BHs can no longer hoover up 6 figure chunks of an over-subscribed £2m loan, they'll all sit on their hands the next time a £5m loan appears in the pipeline then I reckon self-interest wins out. There aren't too many other places out there launching £5m-£10m per month of 12% asset-secured loans and SS always have the option of waving the cash-back wand a little to help them get the gold-plated cheque-books out again. Pre-funding by % allocation of whatever people are rich / bold / stupid enough to ask for is a dogs breakfast of a process, leaving the majority frustrated at getting scaled back whilst a minority wallow in more than they're willing or able to pay for. Happily I think we're rapidly approaching its demise.
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jamesc
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Post by jamesc on Aug 10, 2016 10:15:54 GMT
Has anyone noticed a problem with the SS website in last 15 minutes tried to make two purchases and after solving the catcha only got the twrilling thing then tried to cancel A loan part I had for sale got the same and eventually was timed out but all loan parts still appear on SM  ? |
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nick
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Post by nick on Aug 10, 2016 10:19:46 GMT
I've had the same problem when buying. It seems when this has happened in the past the transactions did all go through so be weary of retrying the same transaction.
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Post by meledor on Aug 10, 2016 10:42:33 GMT
If you are not prepared to do any DD and want it all on a plate then I humbly suggest you would be better of putting your money in the building society. You cannot expect to earn 12% p.a. without some work on your part and a recognition of the risk arising from a greater degree of uncertainty than would apply to investments with lower returns.
It is, IMHO, incumbent upon savingstream to ensure that the information they have provided is correct and that the LTV stated takes cognisance not only of the property in question but also the people connected with the loan. savingstream continue to use the open market valuation when declaring the LTV, ignoring the prospect of possible default and subsequent consequence to capital returns. The average lender is probably not aware of this and probably does not know how to carry out any DD on their own behalf. We should remember that many lenders in p2p are not aware of platforms like this and rely solely on the information given by platforms listing loans. I strongly believe that all platforms should be made to list p2p forum sites on the loan page and encourage lenders to visit them for further information on loans. There are many on this forum who readily jump to the defence of platforms regarding the naming of borrowers, LTVs, defaults and mock the (supposed) ignorance of lenders in not carrying out their own DD. The majority of p2p lenders are not sophisticated lenders, relying on the individual platforms to get their DD right and these platforms have a moral and legal duty to these people as well.
"It is, IMHO, incumbent upon savingstream to ensure that the information they have provided is correct.."
Agreed. Are you suggesting that it is not?
"..and that the LTV stated takes cognisance not only of the property in question but also the people connected with the loan."
Not sure how the LTV can take "cognisance" of the people connected with the loan. The LTV is whatever the LTV is as determined by the property valuation.
I am certainly not mocking anyone's (supposed) ignorance. I appreciate not everyone has the time to do a lot of DD and this is where this forum is useful. The amount of DD I will do depends on the size of the loan - I did more on this because in my opinon it looks quite attractive.
Questions have been asked about the amount paid for the property by the borrower in March 2015. As I had already found that out I was happy to share it here. Inevitably it caused further questions because of the difference between that and the valuation. I and SteveT have answered that as well. However for some people that is not good enough and presumably want SS to disclose the borrowers purchase price as a matter of course along with an explanation of why there is a difference from the valuation. I personally do not think that is realistic - I've already mentioned possible confidentiality issues relating to the nature of the agreement and the previous owner - but there is a wider issue which your comment highlights which is that if you do not have confidence in the valuation report then you should not be investing in the first place. The platform definitely does not have "a moral and legal duty" to do people's DD for them. The 12% comes with a certain amount of risk. If you are not sure don't invest.
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Post by trilby on Aug 10, 2016 10:58:44 GMT
Another £130k just appeared on the SM, apparently from SS because the queue is still only £21k.
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SteveT
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Post by SteveT on Aug 10, 2016 11:10:30 GMT
Another £130k just appeared on the SM, apparently from SS because the queue is still only £21k. Probably parts they've had to cancel, bought by lenders who assumed it would be allocated by % of pre-fund and that it would be oversubscribed As the saying goes, "be careful what you wish for"!
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goopy
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Post by goopy on Aug 10, 2016 11:16:31 GMT
Another £130k just appeared on the SM, apparently from SS because the queue is still only £21k. Probably parts they've had to cancel, bought by lenders who assumed it would be allocated by % of pre-fund and that it would be oversubscribed As the saying goes, "be careful what you wish for"! Or SS are holding quite a lot of this loan and they are releasing it slowly so as not to 'spook' the market, as they have done in the past. What I don't understand is why there is 21k of investors loan parts for sale? The loan only went live yesterday and it was filled bottom up so presumably everyone got what they wanted?
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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 Aug 10, 2016 11:19:20 GMT
Probably parts they've had to cancel, bought by lenders who assumed it would be allocated by % of pre-fund and that it would be oversubscribed As the saying goes, "be careful what you wish for"! Or SS are holding quite a lot of this loan and they are releasing it slowly so as not to 'spook' the market, as they have done in the past. What I don't understand is why there is 21k of investors loan parts for sale? The loan only went live yesterday and it was filled bottom up so presumably everyone got what they wanted? People who didnt see/read/read all the mail in time and prefunded on basis of % allocation
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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 Aug 10, 2016 11:27:57 GMT
Oops, has anyone looked at the loan particulars recently? SS updated it a few days ago to include reference to borrowers long term involvement & exercising an option which explains the discounted purchase price (email repy). Gold stars to meledor and SteveT and SS who were clearly paying attention. No stars to CD and me for not spotting this  |
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goopy
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Post by goopy on Aug 10, 2016 11:42:52 GMT
Or SS are holding quite a lot of this loan and they are releasing it slowly so as not to 'spook' the market, as they have done in the past. What I don't understand is why there is 21k of investors loan parts for sale? The loan only went live yesterday and it was filled bottom up so presumably everyone got what they wanted? People who didnt see/read/read all the mail in time and prefunded on basis of % allocation Of course, that makes perfect sense ilmoro .
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Post by meledor on Aug 10, 2016 14:53:49 GMT
"It is, IMHO, incumbent upon savingstream to ensure that the information they have provided is correct.."
Agreed. Are you suggesting that it is not?
There are numerous posts on this site that highlight discrepancies in various valuation reports that savingstream have posted in loans.
"..and that the LTV stated takes cognisance not only of the property in question but also the people connected with the loan."
Not sure how the LTV can take "cognisance" of the people connected with the loan. The LTV is whatever the LTV is as determined by the property valuation.
The LTV is not only determined by the property valuation. There are generally 3 valuations that can be used in arriving at the LTV figure. savingstream always uses the open market valuation. The Loan amount is determined by savingstream and in determining this figure savingstream could take into account the past history of the borrower. A person with a poor credit history or other financial related issues could be offered a lower loan figure, thereby reducing the LTV, giving the lenders greater capital protection.
I am certainly not mocking anyone's (supposed) ignorance. I appreciate not everyone has the time to do a lot of DD and this is where this forum is useful. The amount of DD I will do depends on the size of the loan - I did more on this because in my opinon it looks quite attractive.
Questions have been asked about the amount paid for the property by the borrower in March 2015. As I had already found that out I was happy to share it here. Inevitably it caused further questions because of the difference between that and the valuation. I and SteveT have answered that as well. However for some people that is not good enough and presumably want SS to disclose the borrowers purchase price as a matter of course along with an explanation of why there is a difference from the valuation. I personally do not think that is realistic - I've already mentioned possible confidentiality issues relating to the nature of the agreement and the previous owner - but there is a wider issue which your comment highlights which is that if you do not have confidence in the valuation report then you should not be investing in the first place. The platform definitely does not have "a moral and legal duty" to do people's DD for them. The 12% comes with a certain amount of risk. If you are not sure don't invest.
The issue some people have IMO is that an open market valuation figure has been used that does not reflect the sum paid for the property. Some lenders are asking for a simple explanation of why this figure was used. There is no need to disclose privileged or confidential information. A higher valuation figure results in a lower LTV making the loan seem safer to lend to.
Having been involved for many years in property development, I am aware of the vagaries of property valuations and recognise that it is not an exact science. I'm surprised that you seem to think that all valuation reports are factually correct. They are the opinion of a qualified surveyor at a given point in time based on prevailing circumstances. Due to the nature of the financial markets and demographics, property valuations can be out of date by the time they are printed and posted out. The standard answer of some people on this site who don't like @savinstream's actions being questioned is "you should not be investing in the first place".
I did not say that savingstream should do everyone's DD for them. What I said was that people relied on the platforms getting their DD right. Platforms do have a legal and moral duty towards their lenders and IMHO, we will see court action arising in the near future when a platform gets it wrong.
I am aware of the risks of p2p, lending in the high six figures across 14 platforms, so I will take your advice with the graciousness it was given. 
"They [valuation reports] are the opinion of a qualified surveyor at a given point in time based on prevailing circumstances."
I have not suggested otherwise. However the opinion will be based on facts relating to the property and those need to be correct.
"There are numerous posts on this site that highlight discrepancies in various valuation reports that savingstream have posted in loans."
Could you please give some examples where SS have provided incorrect information?
"I did not say that savingstream should do everyone's DD for them."
Other posters (martin44 and mack) were saying that hence my previous comments. And you did say "the average lender ...does not know how to carry out any DD on their own behalf" and if true this concerns me because there is no such thing as a free lunch especially with investments offering a higher return. In my opinion they would be better off in lower risk investments. No one is disagreeing that platforms need to get their own DD right.
You have repeated your view that SS should be using lower valuations when calculating LTVs. As SS's policy is to set a 70% ceiling for LTVs this will result in reduced loan amounts being offered and I suspect there would be downwards pressure on interest rates for such deals as a result. Personally I am happier with the returns as they are albeit with the additional risk.
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mack
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Post by mack on Aug 10, 2016 15:07:06 GMT
No. What I said was if saving stream is not doing the due diligence that the general public can rely on then they will end up having to market to sophisticated investors. Some p2p platforms already do and do not market directly to the public and the entry level is £100k - £250k and above.
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Post by dualinvestor on Aug 10, 2016 15:14:29 GMT
No. What I said was if saving stream is not doing the due diligence that the general public can rely on then they will end up having to market to sophisticated investors. Some p2p platforms already do and do not market directly to the public and the entry level is £100k - £250k and above. Whatever you believe should happen or savingstream should do they are explicit in their terms and conditions 2.5 reads "A lender must form its own opinion regarding the creditworthiness of a borrower and undertake its own research, analysis and assessment of each borrower for each loan and, where appropriate, seek its own independent financial and legal advice."
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