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Post by dualinvestor on Oct 21, 2016 4:36:54 GMT
A question to Saving Stream... Are you reasonably confident that the sale price, less all fees, including the administrators' fees, will be enough to cover the return of capital and accrued interest? This is a Receivership and the person (s) appointed are Receivers and managers. The scope of their work is far less complex than that of a Adminstrator (eg they will not be doing any trading of a buisness, they are not responsible for collecting and selling other assets of the company, they do not have to prepare reports/proposals or deal in any other way with any creditors, except secured creditors, the compay may have). The sum of which means that the fees should be lower.
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Post by dualinvestor on Oct 21, 2016 4:49:37 GMT
I think you are right here mikes1531 , SS set a precedence here which i reckon they will now be regretting, i would not be surprised if and when 20 is sorted, they will never use a red box again. SS might get away with not naming the old T&C loans in default when they default (and thus avoid the requirement to use a big red box), but not the new T&C loans. When a loan on the new T&Cs defaults, SS will have to tell us and make it clear all investors via a big red box (or simply stop SM activity of trading defaulted loans) Under the new terms, as far as lenders are concerned, clause 13.1 states "Saving Stream (acting as agent on behalf of the lenders) and Saving Stream Security Holding may enforce payment of the debt and enforce the security against the borrower." This may be entirely different to what is stated as default in the loan agreement between SS and the borrower, eg in loan agreements there are usually several potential events that if they occur automatically or at the discretion of the lender put the loan into default. Whilst it would seem good practise to notify lenders by a big red box I can't see anything that would compel them to do so. That would be a matter for someone who is aggreived by the failure to do so and who has lost money as a consequence to test in court.
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Post by geraldine1210 on Oct 21, 2016 5:55:30 GMT
A question to Saving Stream... Are you reasonably confident that the sale price, less all fees, including the administrators' fees, will be enough to cover the return of capital and accrued interest? This is a Receivership and the person (s) appointed are Receivers and managers. The scope of their work is far less complex than that of a Adminstrator (eg they will not be doing any trading of a buisness, they are not responsible for collecting and selling other assets of the company, they do not have to prepare reports/proposals or deal in any other way with any creditors, except secured creditors, the compay may have). The sum of which means that the fees should be lower. Thank you.
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dovap
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Post by dovap on Oct 21, 2016 9:16:48 GMT
Receiver been on the case for ~ a month - so I guess this is on the market now for those looking to purchase a piggy farm ?
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mikes1531
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Post by mikes1531 on Oct 22, 2016 17:33:23 GMT
The piggy farm is yours for £450k (Zoopla). If the property is for sale for less than the loan amount, that creates an interesting situation. In the update of three weeks ago, SS wrote "Lendy will cover the interest for the next 2-3 months and recover these payments from the sale proceeds. We don\'t feel it necessary to formally default this loan as we believe there is a viable exit strategy in place." There may be an exit strategy in place, but ISTM that it doesn't appear be a viable way of recovering all of investors' capital and interest. With such a low price, the only way Lendy could recover their interest payments would be by investors suffering a capital loss. So unless SS/Lendy have something significant up their sleeve, it would appear that anyone invested/investing in this loan is not going to receive from here forward what they're being led to believe they will. That makes me think that another red box needs to appear very soon. While the SM seems to be a bit clogged right now, ISTM that it's about to get a lot worse.
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Post by dualinvestor on Oct 24, 2016 15:13:40 GMT
Lendy will cover the interest for the next 2-3 months and recover these payments from the sale proceeds. We don't feel it necessary to formally default this loan as we believe there is a viable exit strategy in place - Savingstream update just after receiver appointed, amount outstandin on the loan £455,000 plus interest accruing at £4.5k per month on the platform loan (plus whatever interet Lendy ltd are charging on top) for at least the last month, probably more than that before it defaulted entered a new exit strategy.
Property listed for £450,000 (prior to costs of realisation e.g Receiver's, agents and legal fees and expenses.
Anyone notice the discrepancy?
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seeingred
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Post by seeingred on Oct 25, 2016 9:51:36 GMT
As a new investor in this platform (but not to P2P) I bought into 056 in a small way. This was after the chickens were known to be coming home to roost - or maybe it was pigs flying past the full moon. There was nothing on the SS site to indicate a particular problem, no big red box for example. I only later found this forum and including the valuable insights and contributions from CD.
Leaving aside for the moment what investors and potential investors were or were not told and when, and what they arguably should have been told, (see previous posts) no-one seems to have questioned the validity of the valuation - which was for £650k in August 2015. Now the site is for sale at £450k (and open to offers??). Lendy might well be funding the interest on the loan for 2 to 3 months (so it looked a reasonable short term investment at a time when the SM was very thin) but if these interest payments are ultimately to be taken from capital - and if the NET sales proceeds are significantly below the £450k figure (as they seem certain to be), where does that leave SS investors?
How can we rely on valuations if these are so far off the mark? Are they worth the paper they are written on? Granted values can change, key personnel may die and a business or building project can lose its way - these are risks investors must accept - but I would question £650k down to £450k or less within a year or so unless maybe all farmland has been similarly affected? It does not give confidence in other farm valuations?
The other general point is that if a borrower has a string of failed companies behind him, then we might be told. In other loan details we are told that (I paraphrase here) the borrower is 'a wealthy man, an highly experienced and successful property developer, a building surveyor with a 27 year history of developing similar sites', etc etc - so as to give prospective investors some extra degree of reassurance. If these 'positive' comments about borrowers are considered relevant to be included by SS in their information to lenders, maybe it could be argued that 'highly negative' characteristics of borrowers should be included by SS also - as an equally valid point of additional information upon which an investment decision could be based?
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Post by Deleted on Oct 25, 2016 10:34:59 GMT
Its probably priced for a quick sale. We'll find out soon enough if the valuation was accurate.
As lenders, we don't really care if the security yields a net 455k, 456k, or 4 million. We don't see any of the excess.
Regarding interest, from the presentations given by Lendy, it seems they take the interest (our cut and their cut), plus the fees upfront. So they should be able to cover a couple of months extra interest, and then theres the provision fund on top of that.
If theres a small shortfall, on such a small loan, it could be worth Lendy making lenders whole just for the publicity.
tbh, I'm very curious to see how this works out.
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Post by dualinvestor on Oct 25, 2016 10:46:09 GMT
As a new investor in this platform (but not to P2P) I bought into 056 in a small way. This was after the chickens were known to be coming home to roost - or maybe it was pigs flying past the full moon. There was nothing on the SS site to indicate a particular problem, no big red box for example. I only later found this forum and including the valuable insights and contributions from CD. Leaving aside for the moment what investors and potential investors were or were not told and when, and what they arguably should have been told, (see previous posts) no-one seems to have questioned the validity of the valuation - which was for £650k in August 2015. Now the site is for sale at £450k (and open to offers??). Lendy might well be funding the interest on the loan for 2 to 3 months (so it looked a reasonable short term investment at a time when the SM was very thin) but if these interest payments are ultimately to be taken from capital - and if the NET sales proceeds are significantly below the £450k figure (as they seem certain to be), where does that leave SS investors? How can we rely on valuations if these are so far off the mark? Are they worth the paper they are written on? Granted values can change, key personnel may die and a business or building project can lose its way - these are risks investors must accept - but I would question £650k down to £450k or less within a year or so unless maybe all farmland has been similarly affected? It does not give confidence in other farm valuations? The other general point is that if a borrower has a string of failed companies behind him, then we might be told. In other loan details we are told that (I paraphrase here) the borrower is 'a wealthy man, an highly experienced and successful property developer, a building surveyor with a 27 year history of developing similar sites', etc etc - so as to give prospective investors some extra degree of reassurance. If these 'positive' comments about borrowers are considered relevant to be included by SS in their information to lenders, maybe it could be argued that 'highly negative' characteristics of borrowers should be included by SS also - as an equally valid point of additional information upon which an investment decision could be based? Just to address the valuation point, when a property is the subject of a insolvency proceding (Administration Receivership Liquidation etc) the previous "Going Concern" valuation goes out of the window, hence the reluctance of SS (and probably all of the other platforms) to appoint receivers. See the article inThe Times yesterday www.thetimes.co.uk/article/peer-pressure-grows-for-fundingindustry-to-pay-its-dues-on-time-lb5cpsqg6
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Post by Deleted on Oct 25, 2016 10:53:53 GMT
Lendy seem to have been quite quick to appoint receivers in this case though.
I'm looking forward to seeing a test of the hypothesis that 'borrower background doesn't matter if the security is good'
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oldgrumpy
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Post by oldgrumpy on Oct 25, 2016 11:17:42 GMT
seeingred As a new investor, no doubt you will be watching PBL064 with more than curiosity also, if you took a bit of that one. Apparently the borrower is "talking" to SS. I wonder if that is to obtain similar loan flexibility to that he gave (or didn't give) to the farmer who previously owned the property secured by PBL056.
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dovap
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Post by dovap on Oct 25, 2016 11:36:19 GMT
Be interesting to see what it fetches when/if it sells
£450K seems pricey for a small ex pig farm and some sorry looking 'footings'
Wonder what the loan was actually used for ?
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Post by dualinvestor on Oct 25, 2016 11:52:27 GMT
Be interesting to see what it fetches when/if it sells £450K seems pricey for a small ex pig farm and some sorry looking 'footings' Wonder what the loan was actually used for ? I did a "back of the envelope" valuation based upon recent sales at auction ib the are and came up with £300k a couple of months ago. It was stated as reasonable by the farmer critic of the debtor. Of course neither of us are valuers and that was just our opinion.
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Oct 25, 2016 11:55:45 GMT
Be interesting to see what it fetches when/if it sells £450K seems pricey for a small ex pig farm and some sorry looking 'footings' Wonder what the loan was actually used for ? The purpose of the loan was to "Purchase and development" However... strange goings on... The property was purchased from a company that DP was also the director of (seriously)... funny enough, that company also had the receivers sent in, almost at the exact same time as our receivers were sent in (who were appointed by a company that DP is the director of). Confused; yes, so am I. DP is up to something... I can feel it in my bones. Edit - for reference, the original owner paid only £180,000 c2013. It was purchased using a loan from one of DP companies (the one that has brought in the administrators to that company)
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ianj
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Post by ianj on Oct 25, 2016 12:33:13 GMT
However... strange goings on... The property was purchased from a company that DP was also the director of (seriously)... funny enough, that company also had the receivers sent in, almost at the exact same time as our receivers were sent in (who were appointed by a company that DP is the director of). Confused; yes, so am I. DP is up to something... I can feel it in my bones. Edit - for reference, the original owner paid only £180,000 c2013. It was purchased using a loan from one of DP companies (the one that has brought in the administrators to that company) I'm out of the two related loans now, but they retain a morbid fascination and it's got the point now where I feel the use of an annotated flip-chart / whiteboard / Powerpoint presentation / post on You Tube is required to keep track of the myriad facts relating to DP, his companies and the SS loans. P.S. Good to see you haven't totally 'retired'.
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