aj
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Post by aj on Mar 12, 2018 13:48:11 GMT
An interesting development... would the original buyer have put down a deposit when contracts were exchanged? (As you would in a domestic property sale) I presume that should FS force a sale to a new buyer, the original buyer would only lose out on their legal fees, and any deposit would be returned?
As the first charge is not yet in default and given FS's track record I think the original buyer can drag it out a for at least 2 more months before they lose it!
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adrian77
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Post by adrian77 on Mar 12, 2018 13:49:04 GMT
I am not sure I agree with this. I would be surprised if the selling contract does not have a set date along with a hefty penalty payment. If the purchaser has legitimate concerns along with a specified time period as specified in the contract then I just don't see how the exchange can be negated?
Wonder if there is any connection between the buyer and seller and this does not feel right to me. I signed for a commercial property last week - I now have 3 months to complete or I lose the purchase and a rather large sum of money - it's not rocket science!
Interesting one which I never liked the look of.
Whatever hopefully this will soon be resolved.
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aj
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Post by aj on Mar 12, 2018 14:59:21 GMT
I am not sure I agree with this. I would be surprised if the selling contract does not have a set date along with a hefty penalty payment. If the purchaser has legitimate concerns along with a specified time period as specified in the contract then I just don't see how the exchange can be negated? Wonder if there is any connection between the buyer and seller and this does not feel right to me. I signed for a commercial property last week - I now have 3 months to complete or I lose the purchase and a rather large sum of money - it's not rocket science! Interesting one which I never liked the look of. Whatever hopefully this will soon be resolved. I think that FS could theoretically call in the defaulted loan to the borrower. This would allow them to take posession and sell to the new buyer. The contract is between borrower and buyer, FS just holds a charge against it. I expect both the borrower and original buyer would lose out in this situation but it all depends on the contract in question.
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Post by brummiefred on Apr 4, 2018 13:02:49 GMT
Original purchaser failed to complete by deadline date (29th March) so FS now in discussions with alternative purchaser with completion set for within 28 days
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james21
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Post by james21 on Apr 4, 2018 13:12:59 GMT
Original purchaser failed to complete by deadline date (29th March) so FS now in discussions with alternative purchaser with completion set for within 28 days Note: Not borrower in discussions with alternative purchaser but FS. Its a default in all but name
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rogerthat
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Post by rogerthat on Apr 4, 2018 13:37:58 GMT
Original purchaser failed to complete by deadline date (29th March) so FS now in discussions with alternative purchaser with completion set for within 28 days Note: Not borrower in discussions with alternative purchaser but FS. Its a default in all but name Seems the 29th was a red letter day for completions..or broken promises or defaults or however you wish to paint over the cracks..Barnoldswick anyone ? 
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adrian77
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Post by adrian77 on Apr 4, 2018 19:39:00 GMT
I have had a quick look on google and there seems to be no change whatsoever - there is no evidence of any work in the FS details unless I have missed it? Of course the google map may be out of date - any reader in the area?
This looks a complete disaster to me for the following reasons
1) £1.65m has already been advanced followed by £250K on a different property - so that is £1.9m over 2 properties but FS only have a charge on one - so what's happened to the other £250K ?
2) we were told
well that does not seem to be exactly accurate does it? I wonder if the alleged purchaser wasn't stupid and had an exit written into the contract subject to DD etc. Of course he could be an associate of the applicant. However assuming the purchaser was genuine then I just don't understand why we were told the above completion dates.
FS state the cinema was valued at £3.2m - that may be an airey-fairey residual valuation but no way can I see the existing site being worth anywhere near that.
So it looks to me that FS advanced £1.65m which was shakey at best - no work is done so FS advance another £250k used by the borrower to buy another property i.e. increased the debt on the original asset which we were told was sold but it isn't!
Well FS can say goodbye to that £250K and I really can't see 100% recovery on this one
Classic!
Sure glad I did not have £300K in this one
Some readers have said they expect defaults to rise - well I won't argue with that!
Another one to add to the worry list. Just glad I smacked it with the smutty stick - of course it may have been a mistake but I doubt it...
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mariner
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Post by mariner on Apr 4, 2018 20:01:15 GMT
Yet another loan destined for a long drawn out list of pathetic updates methinks, check in a years time
As stated before FS are way out of their depth with property loans, in fact clueless
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micky
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Post by micky on Apr 4, 2018 21:04:45 GMT
It's a long shot but is there any chance that the original purchaser has cut out the middleman- our borrower and gone straight to FS to do a deal him/herself?
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rogerthat
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Post by rogerthat on Apr 4, 2018 21:21:52 GMT
It's a long shot but is there any chance that the original purchaser has cut out the middleman- our borrower and gone straight to FS to do a deal him/herself? What a devious mind you must have  ....after what ive read on this platform recently and Mr Smutty not knowing which way to turn and with all the potential black holes appearing in the way of updates or renewals, that's the shortest straw ive seen today so I'm gonna grab it. I would throw thruppence under the pillow later tonight but the way things seem to be heading on FS presently, I think Id better hang on to it. fundingsecure , you really need to get a grip on this situation because there are some very concerned lenders out here looking over their shoulders at the blast wave still emanating from another P2P
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adrian77
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Post by adrian77 on Apr 5, 2018 9:23:54 GMT
I am sure you are right and I missed it BUT we were given a residual valuation rather than it being made clear this was a wild punt with the owner hoping to turn a quick profit. As I have said before I played that game as a young developer but it was very dangerous. I thought this proposed sale was a safety measure that could be called upon if needed.
I thought the commercial retail market was declining due to over-supply and FS stated
well if other plans had failed then why was this one likely to succeed at massive borrowing costs? I am glad the frontage is listed but that is another expense. I guess the local market has cooled and the building deteriorated so this asset has gone down in value.
Sadly I have never developed a building of this size but I really can't see it being worth much more than £1m - message to FS don't worry about local developers knowing the situation here and making low offers! I often buy from distressed sellers at 50% discount so I may (or may not) be in the right ball park.
Never did like loans with bonuses - guess there is no such thing is life as free popcorn!
If this makes 50% capital recovery that is £150K loss (plus loss of interest over a couple of years) for those with £300K in this one - even a 30% loss will result in a £100K loss - bit of a video nasty.
This sure looks like another disaster in the wings - coming soon to a screen near you!
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adrian77
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Post by adrian77 on Apr 5, 2018 10:00:35 GMT
update to my last post - looks to me the below £250K lower ranking loan may well be a 100%
write off
This is not the first property loan where I worry about a total loss...
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Liz
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Post by Liz on Apr 5, 2018 10:38:15 GMT
update to my last post - looks to me the below £250K lower ranking loan may well be a 100% write off This is not the first property loan where I worry about a total loss... . I avoided this, glad I did as I worry for the investors in this one. I just didn't have a clue to the value of a dilapidated cinema. I stick to loans like the one today, where I can check the value and not having to believe the dodgy valuation. The 1st loan, at best was a risky proposition, the 2nd was a big gamble and those lenders are either super trusting of the FS updates or at best, politely I shall say naive. Scarborough anybody?
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Post by brummiefred on Apr 5, 2018 17:54:01 GMT
adrian77. I have been over to have a look this afternoon and can positively state that there are NO signs of any activity.
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adrian77
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Post by adrian77 on Apr 5, 2018 19:42:38 GMT
thanks very much - looks like this was a speculative punt at 30% interest that really didn't come off - Funding Secure - I don't this so....
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....after what ive read on this platform recently and Mr Smutty not knowing which way to turn and with all the potential black holes appearing in the way of updates or renewals, that's the shortest straw ive seen today so I'm gonna grab it. I would throw thruppence under the pillow later tonight but the way things seem to be heading on FS presently, I think Id better hang on to it.