pip
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Post by pip on Oct 17, 2016 14:08:21 GMT
To be honest I don't really understand what your point is, beyond the problems that I have already outlined which I said I agree with you.
How is FC able to make the lender bring in additional security, they may not have any additional security to put against the loan? It's not going to happen.
If you don't think FC's DD and fraud prevention procedures allow you to meet you goals then simply don't lend through them.
I kindly suggest 10% net of fees is ambitious, but if you think you can achieve that good luck to you.
For me with all their problems, property development loans are still pretty attractive as part of a well diversified portfolio.
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ptr120
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Post by ptr120 on Oct 17, 2016 14:42:06 GMT
Pip, this loan is on a hotel which is open and trading - as such it is (in my opinion) a little different to, for example, a 'simple' property development loan where the construction and / or sale has been delayed for whatever reason. The asset is would appear to be capable of generating sufficient revenue to service these loans on a monthly basis yet FC have not required the borrower to do so because their systems can't cope with it.
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jayjay
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Post by jayjay on Oct 17, 2016 16:43:08 GMT
Pip, this loan is on a hotel which is open and trading - as such it is (in my opinion) a little different to, for example, a 'simple' property development loan where the construction and / or sale has been delayed for whatever reason. The asset is would appear to be capable of generating sufficient revenue to service these loans on a monthly basis yet FC have not required the borrower to do so because their systems can't cope with it. The hotel continues to produce a revenue stream and FC hold a debenture. I have had it confirmed from customer services that the original prospectus is correct on these points. My reading is that FC property team would willingly refinance themselves but the borrower is looking (and indeed nearly completing?) elsewhere. Meanwhile 12% revenue accrues.
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Post by Deleted on Oct 18, 2016 0:16:06 GMT
To be honest I don't really understand what your point is, beyond the problems that I have already outlined which I said I agree with you. How is FC able to make the lender bring in additional security, they may not have any additional security to put against the loan? It's not going to happen. If you don't think FC's DD and fraud prevention procedures allow you to meet you goals then simply don't lend through them. I kindly suggest 10% net of fees is ambitious, but if you think you can achieve that good luck to you. For me with all their problems, property development loans are still pretty attractive as part of a well diversified portfolio. Well, if you don't understand what means that my risk profile increases disproportionally, then it looks to me you don't understand how things work in the bridging loan industry. It is pretty commonplace to ask additional security when you are giving something extra (say 1 extra year of interest), not originally planned, to a borrower. And given, typically, these borrowers have either personal or company assets (but they usually lack cash), asking them to bring in an additional security is the easiest way to find a common discussion ground in renewals. FS and SS ask this all the time to borrowers. As for your suggestions to leave FC: ah, ah. Once again you are naive enough not to understand I have practically planned already it years ago. I have probably the record number of withdrawals in 2016 (over 100 in the last 6 months now). I am progressing all the time in selling and waiting the end of all the loans I have (always selling with a small premium, at least to cover the fees). 10% net is not ambitious at all. I would have easily reached it without fraud. Of course I had planned/hoped for more support from the FC team all the way (no diversification is not enough in my view). Good luck with the FC property loans. You can still buy many of my loan parts on the SM and they offer better rates than on the primary market.
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Post by Deleted on Oct 18, 2016 0:26:46 GMT
Pip, this loan is on a hotel which is open and trading - as such it is (in my opinion) a little different to, for example, a 'simple' property development loan where the construction and / or sale has been delayed for whatever reason. The asset is would appear to be capable of generating sufficient revenue to service these loans on a monthly basis yet FC have not required the borrower to do so because their systems can't cope with it. The hotel continues to produce a revenue stream and FC hold a debenture. I have had it confirmed from customer services that the original prospectus is correct on these points. My reading is that FC property team would willingly refinance themselves but the borrower is looking (and indeed nearly completing?) elsewhere. Meanwhile 12% revenue accrues. Well, I don't have any proof or even a written confimation that the revenues generated via the security are actually collected in any way by FC. It would be the first time that a solid asset is litterally stolen (of its value) under the nose of the very careful FC team. Certainly nominating a receiver would, at very least, guarantee a formal solution to the problem of having direct access to the security books and current revenues. Whatever reading of the situation, the reality if 188 days of delay and 218 days of non-payment of any interest by FC with an LTV running up all the time. And revenue 'accruing' all the time (with no additional security in) is exactly part of the problem, as that is helpòing to grow the loan the borrower will have to pay back and has problems in dealing with.... It is a Vicious circle that needs breaking with either new security or an immediate default/receivership.
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pip
Posts: 542
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Post by pip on Oct 18, 2016 8:55:58 GMT
To be honest I don't really understand what your point is, beyond the problems that I have already outlined which I said I agree with you. How is FC able to make the lender bring in additional security, they may not have any additional security to put against the loan? It's not going to happen. If you don't think FC's DD and fraud prevention procedures allow you to meet you goals then simply don't lend through them. I kindly suggest 10% net of fees is ambitious, but if you think you can achieve that good luck to you. For me with all their problems, property development loans are still pretty attractive as part of a well diversified portfolio. Well, if you don't understand what means that my risk profile increases disproportionally, then it looks to me you don't understand how things work in the bridging loan industry. It is pretty commonplace to ask additional security when you are giving something extra (say 1 extra year of interest), not originally planned, to a borrower. And given, typically, these borrowers have either personal or company assets (but they usually lack cash), asking them to bring in an additional security is the easiest way to find a common discussion ground in renewals. FS and SS ask this all the time to borrowers. As for your suggestions to leave FC: ah, ah. Once again you are naive enough not to understand I have practically planned already it years ago. I have probably the record number of withdrawals in 2016 (over 100 in the last 6 months now). I am progressing all the time in selling and waiting the end of all the loans I have (always selling with a small premium, at least to cover the fees). 10% net is not ambitious at all. I would have easily reached it without fraud. Of course I had planned/hoped for more support from the FC team all the way (no diversification is not enough in my view). Good luck with the FC property loans. You can still buy many of my loan parts on the SM and they offer better rates than on the primary market. Hor there is no need to be patronising and arrogant you know? A little courtesy costs nothing, cheap insults at me was totally uncalled for. I was only giving my opinion.
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kt
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Post by kt on Oct 18, 2016 9:46:42 GMT
Agreed. Hor we can all appreciate that you are frustrated with Funding Circle but you need to step back and take a deep breath.
There are always going to be differences of opinion. By being rude you undermine your other statements.
We can all see that you are annoyed and we feel your frustration though it is not clear what you are hoping to achieve by continuing on restating your grievance.
Perhaps it is time for you to call your solicitor should you feel so aggrieved.
With respect and good intentions,
KT
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blender
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Post by blender on Oct 18, 2016 11:10:48 GMT
Hor, so much of your analysis is good and your conclusion that you need to leave FC if you wish to obtain 10% net also correct. FC is no longer for the experienced lender who wishes to pick loans to do better. 10% historical is ok, going forward it is not. FC is for the investor who wants to put a sum in simply and achieve around 7% net, without bothering about the detail. You can do a bit better but no longer 10% net going forwards. If you have discovered that why not forgo the premium, sell quickly at par, avoid further defaults and lateness, and get the higher rates for longer on the other sites? FC are not going to change to suit you, so why keep fighting them?
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Investboy
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Trying to recover from P2P revolution
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Post by Investboy on Oct 18, 2016 11:58:17 GMT
I did speak to Funding Circle during LendIt about these property loans. The marketing team couldn't really comment but I was told someone would contact me to discuss this. To date I've not had any contact, so I will try again later today. Also during their recent Investors Drinks people raised same questions. But "they could not comment on loan particulars" and referred to contact customer service.
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Post by Deleted on Oct 18, 2016 12:21:32 GMT
Hor, so much of your analysis is good and your conclusion that you need to leave FC if you wish to obtain 10% net also correct. FC is no longer for the experienced lender who wishes to pick loans to do better. 10% historical is ok, going forward it is not. FC is for the investor who wants to put a sum in simply and achieve around 7% net, without bothering about the detail. You can do a bit better but no longer 10% net going forwards. If you have discovered that why not forgo the premium, sell quickly at par, avoid further defaults and lateness, and get the higher rates for longer on the other sites? FC are not going to change to suit you, so why keep fighting them? I have not put an extra penny in FC for about two years and I am in the final part of full withdrawal plan which should allow me to extract all my original invested capital within the next 3 months (current projection) and will leave the total interest running on the very few selected loans I will have left by then (as my 10% goal is still not impossible to achieve if some recoveries kicks in). I am not interested in accelerating this process if this costs me lost revenue and will anyway continue fighting for the sums which are still overdue (like this loan) or in default. I honestly do hope that recommendations and complaints from customers will make FC change at least in the process followed for property loans. It would be very naive from them not to listed at all to so many people complaining all in the same direction. It is just a question of time and I am sure they will realise the risks they are putting their lenders in....
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markr
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Post by markr on Oct 18, 2016 14:20:44 GMT
A similar situation is happening with the Newquay property loans. To be fair to FC and the borrower on this one, the first 8 tranches are repaid and a big chunk of the final tranche 9 (~190k IIRC) has been paid to FC. This raises another issue though: the borrower no doubt believes they've repaid the bulk of tranche 9 and are accruing interest only on the balance, lenders in tranche 9 have been paid nothing and may reasonably assume interest is accruing on their entire loan part.
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blender
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Post by blender on Oct 18, 2016 14:35:52 GMT
Surely FC would not be silly enough to use that argument. The loan is not repaid until the lenders have it. Whether FC can extract the interest from the borrower is another matter. I guess that FC will pay in full and we will never know who paid.
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adrianc
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Post by adrianc on Oct 18, 2016 15:02:40 GMT
A similar situation is happening with the Newquay property loans. To be fair to FC and the borrower on this one, the first 8 tranches are repaid and a big chunk of the final tranche 9 (~190k IIRC) has been paid to FC. Yep, recent comments say £40k (17th Oct) and £150k (12th Oct) have been received towards a £250k total tranche. There may be bits left over from previous tranches, too, so they're nearly there. That's between them, FC and the Ts & Cs of the loan... SEP, as far as I'm concerned.
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blender
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Post by blender on Oct 18, 2016 16:50:23 GMT
SEP Someone Else's Problem or Spherical Error Probable? Both I suppose.
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avenger
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Post by avenger on Oct 19, 2016 4:07:12 GMT
Agreed. Hor we can all appreciate that you are frustrated with Funding Circle but you need to step back and take a deep breath. There are always going to be differences of opinion. By being rude you undermine your other statements. We can all see that you are annoyed and we feel your frustration though it is not clear what you are hoping to achieve by continuing on restating your grievance. Perhaps it is time for you to call your solicitor should you feel so aggrieved. With respect and good intentions, KT For the last six months or so, Hor has been threatening to contact everyone from his MP to the FCA - Don't put ideas into his head ....
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