gustapher
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Post by gustapher on Oct 2, 2017 21:25:24 GMT
Where to go from here? I'm certainly not going to be investing any more - we are looking at a commercial property investment at the moment - a big factory unit with machinery and stockholding - finance rates? About 5 to 6% for an investment of about £1.5m - so why are so many people going to Lendy for money? Because no sensible bank or lending institution would hand out a dime to them. What type of finance is that though? At 5-6% that sound more like a normal commercial mortgage. Bridging/development finance is completely different. A quick google search shows Lendy's rates while not cheap are not out of the ordinary.
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GeorgeT
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Post by GeorgeT on Oct 2, 2017 21:34:30 GMT
I've been going thorugh the valuations. As Chartered surveyors ourselves, I'm staggered to see the utter  being written by the valuers of most of these Lendy investments. I've written in strong words to Lendy and in response to my suggestion that I set up a website revealing just how bad this is, they tried to pull the legal 'threat' of defamation. I won't even give them the benefit of a reply - FACTS dear Lendy - are not defamation. Lets briefly look - valuations based on the 'possible value of the business when set up on a piece of overpriced goat pasture' - result: DEFAULT with little or no possibility of recovery. A long list of defaults, and mostly now quoting similar stories - over valued. Another - 'Oh - its in default because we never considered the fact the borrower might not actually have the money to do the development'... Now a bunch of over priced London developents that are looking similarly dodgy. Lendy - YOU are making statements to investors - don't bloody tell me that it is not your business to make sure these facts stand up, and when the thing falls over, tell me I should have done more research - that's complete bullshit. YOU make statements. YOU tell investors you have credit checked and done due diligence? It looks like a 6 year old could have done better diligence on some of these loans. WHY does Lendy stop allowing interest to accrue to the owner of an investment when it is placed into the SM? I asked that question and they neatly side stepped it - no answer. Why? Because I reckon its bloody illegal. I own that investment till its sold. They don't want a SM - if they did, interest would accrue in the normal way, whether someone had their share on the market or not. It's still mine, with any interest accrued, till its sold. Where to go from here? I'm certainly not going to be investing any more - we are looking at a commercial property investment at the moment - a big factory unit with machinery and stockholding - finance rates? About 5 to 6% for an investment of about £1.5m - so why are so many people going to Lendy for money? Because no sensible bank or lending institution would hand out a dime to them. Lendy told me to do my research - I did - and checking the valuations carefully reveals just how the system is being screwed. Who is in bed with who I have no idea - but the valuation surveyors have substantial indemnity insurance - in my view they are going to need it. Funny how Lendy now refer to 'taking legal advice' when referring to the valuations. They must have very happy lawyers - because almost every loan seems to be handed to their receivers and lawyers - some months before they are due to mature. And they threaten anyone who dares question their financial acumen! Chartered Surveyors are required to act in a way that does not damage the reputation of the profession and comply with RICS codes of conduct. Your post does not do that so I doubt very much you are a chartered surveyor. I think you are a troll. Beside your post makes little sense because on the one hand you say the valuations are a load of rubbish and on the other hand you say you have been investing in LY loans. If you have the expertise you claim to have and feel as you state then why have you been investing in these loans in the first place. Of course some of the valuations are based on certain assumptions and events that are hypothetical and are quite subjective and do not allow for the fire sale scenario but that does not mean they are rubbish. They are what they are and need to be interpreted. Of course LY is a lender of last resort and of course if people had top class credit backgrounds and top class low risk proposals they would be able to obtain cheaper finance elsewhere. That's why you get a headline rate of 12% here. Surely a knowledgeable professional like yourself didn't think you could get 12% interest without accepting an awful lot of risk and lending to some borrowers of dubious character and history. It is all about separating the wheat from the chaff and adopting a sensible, risk averting investment strategy. i.e. the risk of any loan increases as the loan ages and therefore the risk to reward ratio is at its best in the early months and at its worst in the later months. Hence you stick to younger loans.
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bugs4me
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Post by bugs4me on Oct 2, 2017 21:54:00 GMT
I've been going thorugh the valuations. As Chartered surveyors ourselves, I'm staggered to see the utter being written by the valuers of most of these Lendy investments. I've written in strong words to Lendy and in response to my suggestion that I set up a website revealing just how bad this is, they tried to pull the legal 'threat' of defamation. I won't even give them the benefit of a reply - FACTS dear Lendy - are not defamation. Lets briefly look - valuations based on the 'possible value of the business when set up on a piece of overpriced goat pasture' - result: DEFAULT with little or no possibility of recovery. A long list of defaults, and mostly now quoting similar stories - over valued. Another - 'Oh - its in default because we never considered the fact the borrower might not actually have the money to do the development'... Now a bunch of over priced London developents that are looking similarly dodgy. Lendy - YOU are making statements to investors - don't bloody tell me that it is not your business to make sure these facts stand up, and when the thing falls over, tell me I should have done more research - that's complete bullshit. YOU make statements. YOU tell investors you have credit checked and done due diligence? It looks like a 6 year old could have done better diligence on some of these loans. <snip> Chartered Surveyors are required to act in a way that does not damage the reputation of the profession and comply with RICS codes of conduct. Your post does not do that so I doubt very much you are a chartered surveyor. I think you are a troll. <snip Irrespective as to whether the poster is genuine or not, I suspect that what he/she is stating is how many lenders viewing this forum feel and it's not just isolated to LY. There are more than a couple of active loans where the borrower is presented to prospective lenders as person of 'means'. So whilst they may be asset rich but cash poor most traditional lenders would be attracted to the proposition unless of course material facts are not being disclosed which I imagine is the case. And this probably deliberate omission of material facts by the platform is to put it mildly deception.
I never in my wildest dreams felt that 12-13% return would be the norm. Closer to 8% after defaults but those defaults - not just on LY - are making that 8% look optimistic IMO. I think we've got to face facts that sooner or later P2P is in danger of blowing up with one platform at least and there will be contagion. Whether it's instigated by the FCA (unlikely), a high profile legal case or the media (more likely IMO).
The saddest part is that most forum members are probably more P2P literate than the vast majority of lenders that are not members but are enticed by 12% returns hiding behind the FCA authorisation.
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Post by grotdog on Oct 2, 2017 22:39:07 GMT
"It is all about separating the wheat from the chaff and adopting a sensible, risk averting investment strategy. i.e. the risk of any loan increases as the loan ages and therefore the risk to reward ratio is at its best in the early months and at its worst in the later months. Hence you stick to younger loans.
"
How the hell do you do that - there is no SM - you cannot bail out as the loan ages - still nobody has explained why the 'policy' is not to pay interest on anything on sale. You invest in a younger loan, and THEN IT AGES AND YOU ARE TRAPPED!! Please explain why interest is not paid when a loan is put on the secondary market in the ever decreasing hope some other poor idiot might buy it.
Troll? To use an aussie term - bollocks. I'm a pissed off investor who can see that Lendy is operating so close to falling over backwards and taking everyone with them, that I'm making damn sure people start making noises and forcing them to change their cowboy attitude. Only this week sometime we had emails saying a loan was about to be paid off - then another saying "oh - erm.. it wasnt - they only paid some of it - we'll um... attempt to get some more back"... Professional does not seem to enter their minds.
As for Rics and professionalism - we are not valuers. I specialise in old houses and I'm bloody good at what I do - I've reduced the damp industry from a £400 million a year fraud to virtually nothing - I protect homeowners from being scammed by valuers recommending damp surveys because they don't understand the one thing that causes deterioration of a building - damp. If they don't understand, and have to get someone else to look at it, they shouldn't survey a dolls house. And that is about how I feel about the idiots that are valuing Lendys properties. Someone on here mentioned 'fire sale' prices. We don't even seem to be getting that - one house that was valued at £1.7 million has been listed at £1million and they can't even seem to get that. How incompetent do these valuers have to be?
.. and by the way George ... the number of rics surveyors that are ending up in court for ethics breaches is not pretty to watch. This week we had another firm who broke every rule in the book - it is so commonplace it's scarey. I'm not a troll - but after spending my life living in some very tough places in the world, doing some bloody tough things, I'm not afraid to speak my mind and put pen to paper. I'm handling more than half a dozen incompetence cases at the moment, and won several more in the past months. rics seriously needs to pull its socks up - and these valuations underline that need very urgently and seriously.
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dovap
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Post by dovap on Oct 2, 2017 23:02:09 GMT
grotty is SEETHING
I'm sure someone will be along soon to suggest that discounts on the SM is the answer
hth
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Post by p2plender on Oct 3, 2017 4:48:51 GMT
Quick somebody pass him a pair of rose tinted specs, there's plenty kicking about on here..
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Post by grotdog on Oct 3, 2017 7:34:24 GMT
Well I've seen it all now - from the rather asinine comments in reply, it's no wonder England is in the mess it's in. I won't bother pointing out the blindingly obvious - but I'd have expected individual investors on this forum to be a little more concerned with their investments than they apparently are. Clearly they couldn't give a rats that Lendy is acting more like a bunch of overstuffed public schoolboys in the 6th form bar than financial professionals with due care and diligence for their clients money. Money that is propping up their own flash lifestyle with nice shiny boats at the yacht club?
Wake up you lot - and try actually pressuring Lendy into acting with due care.
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Post by p2plender on Oct 3, 2017 8:04:43 GMT
I actually did wake up around 6 months ago and constantly bemoaned Lendy filling the pipe line with never ending supply just as the sm was getting very clogged. Hence the this thread. Let's hope a few paid a little attention.
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Post by martin44 on Oct 3, 2017 8:20:54 GMT
Well I've seen it all now - from the rather asinine comments in reply, it's no wonder England is in the mess it's in. I won't bother pointing out the blindingly obvious - but I'd have expected individual investors on this forum to be a little more concerned with their investments than they apparently are. Clearly they couldn't give a rats that Lendy is acting more like a bunch of overstuffed public schoolboys in the 6th form bar than financial professionals with due care and diligence for their clients money. Money that is propping up their own flash lifestyle with nice shiny boats at the yacht club? Wake up you lot - and try actually pressuring Lendy into acting with due care.Many have, myself included, unfortunately they seem to have now taken a vow of silence. If you think its bad here take a look at Fundingsecure, there is now a clear danger the whole P2P thing is beginning to turn sour. (Or maybe i'm 6 months too late)
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gustapher
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Post by gustapher on Oct 3, 2017 8:35:35 GMT
The best thing you can do to pressure Lendy in my view is to try to be objective at all times. That means criticising where it is due, but provide evidence to support what you are saying rather than pure opinion/speculation. It also means giving credit where it is due.
The problem with venting negative emotions all the time - no matter how justified they might feel - is that it switches people off and undermines your own credibility. On the other hand if you are fair and balanced it will add weight to your criticisms as and when you do make them.
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Post by jackpease on Oct 3, 2017 8:39:39 GMT
I think the "asinine" comments may be because this board has been (sometimes tiresomely) criticising Lendy for the last several months - and new commentators wade in as though none of the arguments had been loudly aired before them.
I think the Lendy criticism is overdone as it is a billed as a risky platform, it is a lender pretty well of the last resort, the valuations may be rubbish but then the same could be said for most rivals, which are increasingly attracting similar ire.
The upside to anger about all this is that hopefully people stop ignoring the risk and uncertainty that is inherent in this sector, and then getting annoyed that losses are not just someone else's problem.
Jack P
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Post by peerlessperil on Oct 3, 2017 9:21:29 GMT
Lendy/SS has always been, in my opinion, one of the riskiest p2p platforms. The following are all concerns that were evident before the current SM back-up, and could be observed by those who took the effort to peruse this forum: - Potential for conflicts of interest given the platform/directors apparently having equity involvement in the garden centre that defaulted
- Comments from Directors that in my opinion indicate a lack of experience in loan recovery (for instance, regarding whether the identity and character of the borrower even matters in secured lending)
- The risk that loans kept under old Ts & Cs could place severe stress on the platform's balance sheet
- Loans to directors of £392k as per Dec 2015 accounts filed at companies house (relative to £1.14m of shareholders funds)
- Lendy is still operating under interim FCA approval
- The directors started lending money against boats, not property
- A large number of lenders intending to offload loans before they reach maturity ("flippers"), relying on a the secondary market to stay liquid in perpetuity
- A par-only secondary market that assists with the supply of "greater fools" (look up the Greater Fool Theory - I'm not being derogatory)
- Huge chunky loans, often secured on commercial premises, where a poor recovery could create a loss potentially exceeding the undisclosed value of the provision fund
- Tranched development funding loans where funding could dry up before the project is completed
- Poor disclosure regarding the provision fund (and Ts & Cs amended to we will "aim" for 2%)
- Some uncertainty on this forum over which loans have been transitioned from the old to the new Ts&Cs
In addition to the above, most of the "12%" platforms often fail to disclose what an asset was recently purchased for, and the valuations are usually optimistic. Property valuation is an art, not a science, once you stray away from the most liquid residential properties (and even then market sentiment can turn very rapidly). Even conservative and diligent valuations can become irrelevant in a forced sale - the value is merely what a buyer on the auction day is willing or able to pay.
None of the points I raise here are new, they are merely the risks that accompany earning 12%. P2P is still the wild, wild west - the sheriff is not in town and you may get shot in the bar minding your own business.
I do retain some exposure to Lendy, but as a risky asset where I fully acknowledge that I may never see all of that money again.
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Post by loftankerman on Oct 3, 2017 10:05:10 GMT
I don't expect my few remaining loans with Lendy to be disasters and if they were, they are only about 6% of those that I have no expectation of recovering for the 'Bank of Dad' that I fund. In departing I see no benefit to anyone currently dealing with Lendy if I try to wreak havoc on the way out. I'm sure people with more at risk will feel differently.
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seeingred
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Post by seeingred on Oct 3, 2017 11:00:27 GMT
"I specialise in old houses and I'm bloody good at what I do - I've reduced the damp industry from a £400 million a year fraud to virtually nothing - I protect homeowners from being scammed by valuers recommending damp surveys because they don't understand the one thing that causes deterioration of a building - damp. If they don't understand, and have to get someone else to look at it, they shouldn't survey a dolls house. And that is about how I feel about the idiots that are valuing Lendys properties."The UK building industry has always been characterised by scams, waste of materials and poor workmanship. Things are better now than they were in the 1960s - rapid expansion of house building rates meant that untrained and often unsupervised labour was used on most sites. Damp is certainly an area where a lot of money has been made on the back of advertisements for products and procedures that simply do not work. Many younger builders simply do not understand older houses and the different requirements for mortar for example. Another example is the cowboy companies who offer to pressure wash moss from roofs "to enhance and protect the value of your property". They persuade little old ladies to pay £500 or more for work that actually damages the tile surfaces - the pressure washing opens up pores and in time the growth of moss is greater than it was before (and it did no harm anyway). I've thought of a website to address this and other issues myself. Another example is companies who sell heating systems to replace 'old inefficient night storage heaters'. Oh sure, they do, but nowhere amidst the sales patter of 'the latest clay core slimline design' etc etc do they mention the fact that these heaters use on peak electricity, which is rather more expensive than off peak (even if the heaters are inefficient owing to poor control of output). The advertisements are so carefully worded - to an expert the scam is as clear as day but to typical home owners it all sounds so plausible. The overriding observation however is that people (and investors) are forever gullible. High profile cases of companies being fined fro breaches of trading standards are in the news one week and forgotten the next, so a whole new set of gullible customers are always available. In any case Trading Standards hardly exists these days owing to cutbacks. The internet is changing this - but not always for the better because the internet itself, whilst a ready source of good advice, is also the mechanism by which so many crooks now make even more money than before. So few people can sort the good from the bad advice. "Buyer beware" - and "Investor beware". As for RICS valuations - they have proven to be such a joke that this side of P2P does need to be cleaned up. The current total of default loans on Lendy is £24million - and with more to come. The purported asset value total is £40 million. Lendy could possibly build into a sustainable business - but the style and purpose of management needs to change. I would thank grotdog for his timely observations.
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Post by charliebrown on Oct 3, 2017 14:02:40 GMT
The current total of default loans on Lendy is £24million - and with more to come. The purported asset value total is £40 million. If valuations were even ball-park accurate then we’d have very little to worry about, apart from recovery delays and inconvenience. In circumstances where, without any significant negligence/ incompetence/ fraud, I lost some invested capital I’d take it on the chin, without holding grudges. My biggest concern at the moment is where some loans appear to be a catalogue of negligence/ incompetence/ fraud. Take a look at IoW, Exeter, H**** for example. These look disastrous. It’s hard to imagine the outcomes being anything short of a blood bath. One catastrophe can wipe out tens of loans that went well, not just in terms of financial impact to investors but in terms of bad sentiment which can then quickly snowball.
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being written by the valuers of most of these Lendy investments. I've written in strong words to Lendy and in response to my suggestion that I set up a website revealing just how bad this is, they tried to pull the legal 'threat' of defamation. I won't even give them the benefit of a reply - FACTS dear Lendy - are not defamation. Lets briefly look - valuations based on the 'possible value of the business when set up on a piece of overpriced goat pasture' - result: DEFAULT with little or no possibility of recovery. A long list of defaults, and mostly now quoting similar stories - over valued. Another - 'Oh - its in default because we never considered the fact the borrower might not actually have the money to do the development'... Now a bunch of over priced London developents that are looking similarly dodgy. Lendy - YOU are making statements to investors - don't bloody tell me that it is not your business to make sure these facts stand up, and when the thing falls over, tell me I should have done more research - that's complete bullshit. YOU make statements. YOU tell investors you have credit checked and done due diligence? It looks like a 6 year old could have done better diligence on some of these loans.
