I am only an engineer and no expert in these matters, but I thought that the UK had moved away from the caveat emptor and information asymmetry, with protection afforded by the likes of the Consumer Rights Act 2015. I believe that SS owe investors a duty of care and by denying access to crucial documents during development, SS are breaching that duty. This is especially so since you changed the Ts&Cs and we investors are now lending directly to borrowers.
I think this is an important point, and one which Savingstream's lawyers can probably advise Paul on. I would imagine if there was a substantial capital loss arising from a default and it subsequently came to light that Savingstream had been in possession of information that would have been material to the due diligence carried out by lenders, a case might be brought against the platform arguing that it is liable for lenders' losses, at least in part, if not in whole. I understand the sensitivity of borrowers to having their personal/private/business interests exposed, but if "caveat emptor" is applicable here then surely also "caveat venditor" should apply - reasonable disclosure should be an expectation when you're borrowing money from P2P lenders. If borrowers don't like it, they can (try to) borrow the money from banks instead...
Post by lendinglawyer on Mar 22, 2017 19:51:10 GMT
Appreciate it's not the exact point at hand here, but I suspect the "legal" restrictions around sharing certain reports are rather "contractual" restrictions imposed by the borrower and/or the report provider, although I would say SS should have sufficient negotiating strength to be able to bat the restriction away to give the information to investors.
As a more general point about standards of information etc., I think actually it would be very difficult to ground a claim barring something pretty egregious. Honestly, I think it would have to go beyond negligence as I am not convinced SS would have a "duty of care" as suggested by one, and anyway so-called "pure economic loss" is very difficult to recover under a tort (i.e. negligence) claim so really you would need a breach of contract (difficult given SS's Ts&Cs) or fraud (which is obviously very hard to prove and requires real dishonesty)... Or of course some sort of claim for breach of FSMA/FCA rules, but my suspicion is that one of the reasons why P2P yields are comparably high for a fixed return asset class open to joe public is that it is less heavily regulated than e.g. offerings of debt securities (my knowledge of this area is however pretty limited), and therefore there is a balance to be struck between desire for high yields and regulatory burden, which if increased I strongly suspect would be passed on to investors through lower yields rather than swallowed by the platforms...
All of which is not to say I excuse poor disclosure (I absolutely do not), I just wanted to put my views (and some facts as I understand them) out there.
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Hi, we have had confirmation from the valuer as to the residual land value of phase 1 of the site (this has increased the overall residual land value of the site from £10.1m to £10.37m and is commented upon in the loan parts. We have also clarified/confirmed the GDV of phase one as per the commentary in the loan parts copied below;:
- GDV of Phase 1 is now calculated at £33,804,000 being the GDV of the completed 60 eco-lodges and 94 eco-glamping pods (£26,180,000) plus the value of the existing buildings/property on the site (arena, gas and restaurant site of £3,654,000) plus the residual land value of phase two (£3,970,000).
Hence the increase in the GDV on the website of £3,970,000, as the residual land value of phase 2 was previously excluded, but is now included.
I responded by listing my loan parts for sale today. 12% and 280 days to run tick a few of the right boxes - but potential total size of loan is a big red cross for me.
My advice would be only invest if you are comfortable to hold to term. Liquidity of any sort must be questionable once this one enlarges some more.
This is already the case, as i've a feeling you are about to find out..... At the rate mine has just moved down the queue, which was a lot smaller than it is now, i'd say you have 2 to 2.5 months of no interest coming on that money, knocking your 12% down to about 7% XIRR at a rough guess.