invester
P2P Blogger
Posts: 612 
Likes: 618
|
Post by invester on Sept 30, 2017 7:14:23 GMT
Not too negative (yet) on this one. By all accounts the full loan amount should be close to recoverable if indeed past evidence relating to this property is to be believed and money has been spent on upgrades. I feel Lendy have been forced to withdraw from secondary market because the original valuation is clearly not a fair reflection of the likely sales figure and they would be in breach of regulation if they continued to trade it. I feel that the reasoning is weak, or perhaps Lendy's methodology of putting absolute faith in bits of paper. For instance, I could borrow £1m on a pair of my old trainers if there was a valuation certificate saying it was worth £1,300,000. And similarly that loan would be able to be traded even though everyone knew it was a sham until another bit of paper came along and confirmed the original valuation was wrong and that actually it was worth zero. If we went through the entire loan book and looked at valuations vs probable recoveries under default (which would almost always be a fire sale) then I guess many loans would be at very large LTVs, apart from on paper of course. At the same time I wonder why a sale hasn't gone through. The person behind it seems keen to get rid of it, and you'd have thought there would be enough minted people in the surrounding areas.
|
|
|
|
Post by charliebrown on Sept 30, 2017 7:39:54 GMT
Not too negative (yet) on this one. By all accounts the full loan amount should be close to recoverable if indeed past evidence relating to this property is to be believed and money has been spent on upgrades. I feel Lendy have been forced to withdraw from secondary market because the original valuation is clearly not a fair reflection of the likely sales figure and they would be in breach of regulation if they continued to trade it. I feel that the reasoning is weak, or perhaps Lendy's methodology of putting absolute faith in bits of paper. For instance, I could borrow £1m on a pair of my old trainers if there was a valuation certificate saying it was worth £1,300,000. And similarly that loan would be able to be traded even though everyone knew it was a sham until another bit of paper came along and confirmed the original valuation was wrong and that actually it was worth zero. If we went through the entire loan book and looked at valuations vs probable recoveries under default (which would almost always be a fire sale) then I guess many loans would be at very large LTVs, apart from on paper of course. At the same time I wonder why a sale hasn't gone through. The person behind it seems keen to get rid of it, and you'd have thought there would be enough minted people in the surrounding areas. Nice analogy with your old trainers  You’ve hit the nail on the head there. I imagine even on the loans that were ok and paid us back with interest a lot of them had dodgy valuations and it was just lucky we didn’t need to “test” those valuations.
|
|
|
|
Post by martin44 on Oct 24, 2017 8:40:42 GMT
Anyone shed any further light on this one re: Update 29/09/2017 'As part of the LPA receiver’s initial due diligence following its appointment on this loan, it has taken advice from various third parties in connection with the property’s value. Unfortunately, this advice has returned giving an adverse opinion as to the property value.'
Mrs44 and her brother are both in this and wondering what may be going on.
|
|
mikes1531
Member of DD Central
Posts: 6,453
Likes: 2,320
|
Post by mikes1531 on Oct 24, 2017 10:47:51 GMT
Anyone shed any further light on this one re: Update 29/09/2017 ' As part of the LPA receiver’s initial due diligence following its appointment on this loan, it has taken advice from various third parties in connection with the property’s value. Unfortunately, this advice has returned giving an adverse opinion as to the property value.' Mrs44 and her brother are both in this and wondering what may be going on. A skeleton may have been found in a closet. (Do haunted castles sell at premium or discounted prices?  ) Or it simply may be that the receivers asked for a valuation and it came in lower than expected. Unfortunately, large unique properties can't be valued easily because of the lack of comparables. Getting a good price depends on the right buyer being in the market at the right time -- or perhaps even needing two of those to bid against each other. Without that, a forced sale is likely to require a big discount on the 'value' in order to encourage someone who really doesn't want the property to take it off your hands. Because of the thinness of the market for this type of property, ISTM that if you ask five valuers for a VR you'll get at least five, very different, answers.
|
|
twoheads
Member of DD Central
Programming
Posts: 1,089
Likes: 1,192
|
Post by twoheads on Oct 24, 2017 10:50:44 GMT
Because of the thinness of the market for this type of property, ISTM that if you ask five valuers for a VR you'll get at least five, very different, answers. But you can bet that Lendy would go with the highest.
|
|
|
|
Post by charliebrown on Oct 25, 2017 14:33:27 GMT
Anyone shed any further light on this one re: Update 29/09/2017 ' As part of the LPA receiver’s initial due diligence following its appointment on this loan, it has taken advice from various third parties in connection with the property’s value. Unfortunately, this advice has returned giving an adverse opinion as to the property value.' Mrs44 and her brother are both in this and wondering what may be going on. A skeleton may have been found in a closet. (Do haunted castles sell at premium or discounted prices? ) Or it simply may be that the receivers asked for a valuation and it came in lower than expected. Unfortunately, large unique properties can't be valued easily because of the lack of comparables. Getting a good price depends on the right buyer being in the market at the right time -- or perhaps even needing two of those to bid against each other. Without that, a forced sale is likely to require a big discount on the 'value' in order to encourage someone who really doesn't want the property to take it off your hands. Because of the thinness of the market for this type of property, ISTM that if you ask five valuers for a VR you'll get at least five, very different, answers. However, is it more than a coincidence that a valuation for the purposes of lending would be significantly higher than a valuation for the purposes of sale/ recovery? It seems to be the same old story with all the loans that have gone bad.
|
|
mikes1531
Member of DD Central
Posts: 6,453
Likes: 2,320
|
Post by mikes1531 on Oct 25, 2017 20:11:06 GMT
Because of the thinness of the market for this type of property, ISTM that if you ask five valuers for a VR you'll get at least five, very different, answers. However, is it more than a coincidence that a valuation for the purposes of lending would be significantly higher than a valuation for the purposes of sale/ recovery? It seems to be the same old story with all the loans that have gone bad. Instructions to valuers ought to request both 'open market' and short marketing period (90 or 180 days, or both) values. Where this has been done, readers of the VRs can get an idea of whether the valuer thinks the property would be easy or difficult to sell in a recovery situation. I've seen some VRs with this information and IIRC in some cases, such as 'ordinary' houses, the discounts believed to be required to shift the properties quickly have been small, while in other cases, such as unique properties, they have been considerable. This is information that should be made available routinely to platform investors so that they can be better informed when deciding whether or not to make an investment in a loan against the property.
|
|
stevio
Member of DD Central
Posts: 2,065
Likes: 894
|
Post by stevio on Oct 25, 2017 20:26:39 GMT
However, is it more than a coincidence that a valuation for the purposes of lending would be significantly higher than a valuation for the purposes of sale/ recovery? It seems to be the same old story with all the loans that have gone bad. Instructions to valuers ought to request both 'open market' and short marketing period (90 or 180 days, or both) values. Where this has been done, readers of the VRs can get an idea of whether the valuer thinks the property would be easy or difficult to sell in a recovery situation. I've seen some VRs with this information and IIRC in some cases, such as 'ordinary' houses, the discounts believed to be required to shift the properties quickly have been small, while in other cases, such as unique properties, they have been considerable. This is information that should be made available routinely to platform investors so that they can be better informed when deciding whether or not to make an investment in a loan against the property. Best make up your own mind on value rather than trust in a valuer employed by the borrower
|
|
|
|
Post by charliebrown on Oct 26, 2017 12:25:06 GMT
Wouldn’t it be more prudent to only lend up to 70% of the 90 day valuation? And also to get 3 different 90 day valuations and take the lowest of the 3. Valuations, or lack of accurate valuations, is the biggest p2p risk factor.
|
|
r1200gs
Member of DD Central
Posts: 1,336
Likes: 1,883
|
Post by r1200gs on Oct 26, 2017 12:35:55 GMT
Wouldn’t it be more prudent to only lend up to 70% of the 90 day valuation? And also to get 3 different 90 day valuations and take the lowest of the 3. Valuations, or lack of accurate valuations, is the biggest p2p risk factor. I think it would be best to get a decent valuation before you even think of getting an LTV based on 90 or 180 days. What we have all seen is absolutely ludicrously inflated valuations that somebody should be held accountable for. It's definitely the biggest P2P risk and it shouldn't be.
|
|
ingwer
Member of DD Central
Posts: 121
Likes: 47
|
Post by ingwer on Jan 19, 2018 17:10:15 GMT
19/1 update - ".... However, enforcement action is continuing notwithstanding the borrower’s attempts to refinance and the LPA Receiver has listed the property for auction on 15 February 2018."
I assume this is the usual auction company A****P who coincidentally have an auction on 15th. Nothing on their preview page though yet.
Interesting times ahead...
|
|
Monetus
Member of DD Central
Posts: 1,179
Likes: 2,961
|
Post by Monetus on Jan 19, 2018 19:20:43 GMT
It is on rightmove Guide price is about 1/4 of the debt  Wow - 25% potential recovery as a "guide price"? A 11% loan? I'm lost for words. 
|
|
mary
Member of DD Central
Posts: 698 
Likes: 711
|
Post by mary on Jan 19, 2018 19:33:43 GMT
Apoplectic! Even if this is a low ball guide to stoke interest you have to assume a greater than 50% loss is more than guaranteed.
Having managed to avoid the prior disasters to date, this is a salutary reminder to me that losses are inevitable at some point.
|
|
ingwer
Member of DD Central
Posts: 121
Likes: 47
|
Post by ingwer on Jan 19, 2018 19:43:32 GMT
Maybe that is why the PF is not being used for anything else * hope *
|
|
|
|
Post by df on Jan 19, 2018 20:43:12 GMT
I've written it off (in my mind) about 3 months before it went below 0 days. Getting 25% back would be a nice surprise.
|
|
You’ve hit the nail on the head there. I imagine even on the loans that were ok and paid us back with interest a lot of them had dodgy valuations and it was just lucky we didn’t need to “test” those valuations. 
)
