adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Sept 27, 2019 17:34:31 GMT
How interesting - clearly the council owned it at some time. Why it is MrC who provides such information and not FS? I missed the part of the VR that talked about demolishing it. The council sold it (I presume), the HO sold it for a very low price - I know hindsight is a perfect science but shouldn't this have rung a few bells. I did guestimate this one at £800K after expenses - be interesting to see just far out I am...
|
|
james21
Member of DD Central
Posts: 651
Likes: 669
|
Post by james21 on Sept 27, 2019 18:24:48 GMT
Obviously this chap had other FS loans that they did not declared to the lenders (disgraceful), he will have come off quite well no doubt, feel for the suplementals wipe out, I am in the development loan and predict a 30% recovery and no interest
|
|
pip
Posts: 542
Likes: 725
|
Post by pip on Sept 27, 2019 18:28:31 GMT
Forget the valuation, that’s not really the issue here.
The issue is that hundreds of thousands was sent to the bank account of a borrower, well in excess of the amount it cost them to purchase the property or it appears they have spent on the property. That money seems to have gone without trace.
What oversight did FS have to ensure that the money released to borrower was spent on completing the project and not siphoned off?
FS you can’t pass the buck that easily.
|
|
sqh
Member of DD Central
Before P2P, savers put a guinea in a piggy bank, now they smash the banks to become guinea pigs.
Posts: 1,426
Likes: 1,211
|
Post by sqh on Sept 27, 2019 19:23:18 GMT
Forget the valuation, that’s not really the issue here. The issue is that hundreds of thousands was sent to the bank account of a borrower, well in excess of the amount it cost them to purchase the property or it appears they have spent on the property. That money seems to have gone without trace. What oversight did FS have to ensure that the money released to borrower was spent on completing the project and not siphoned off? FS you can’t pass the buck that easily. Actually, I think it's all about the valuation. As a rule I don't invest in 2nd tier/2nd change loans, and the same applied in this loan. However, I did buy the 2nd tier loans on the SM after reading the Nov 2017 and March 2018 VR's, because the development was nearing completion and valuations couldn't be very far wrong. I won't be the only lender to have seen that opportunity. The valuer can't claim Brexit, these VR's were well past the Referendum date. The valuer can't claim Grenfell. These VR's were months later. The valuer can't claim the market has fallen, Hometrack prices in Liverpool are rising the fastest of any town/city in the UK at 5.8% p.a. It looks like a slam dunk PI claim against a RICS valuer. If that fails, then I cannot see any point in ever requesting a valuation. I think the valuer took the supposed sale price of one apartment and multiplied by 42. Surely that's gross negligence?
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Sept 27, 2019 21:32:17 GMT
I think both pip and sqh have valid points - I see that this chap has over £6.5m of OUR money - as I said before when I borrowed money to develop the bank kept very tight control of my (their!) bank account and there is no way on this planet they would have let me get into this mess. To be fair to FS I don't think we don't (as yet) had proof that there is no audit trail but neither do we have proof there was one. So FS throw £6.5m+ at this chap and at least 5 of the 6 developments have or are expected to make a massive loss. So how do we know a couple of million or so has not gone walkabout - we don't! This chap has gone bankrupt so virtually no chance of seeing the money. I wonder if he is now living in emergency council accommodation - answers on a digital postcard. I thank you.
|
|
|
Post by defaultinator5000 on Sept 27, 2019 21:37:23 GMT
It's also not against the law for a developer to work on more than one project at once. Yes this does concentrate risk but not increase it overall. While knowing more about the borrower is always useful I don't recall FS ever promising to let us know that borrowers had other projects on the go together with loans from FS or any other platform / finance provider. I agree with most of the things you said. However, what you refer to as "concentrated risk" is most definitely increased risk. Let us assume that, knowing the type of borrowers FS attracts, the probability of a borrower defaulting on his obligations is 30% (my sorry portfolio says otherwise, but let's be generous). If the borrower takes out three loans, the odds of all three loans going pear-shaped is 30%. However, if three unrelated borrowers took out those three loans, the odds of all three loans defaulting is merely 2.7%, a collossal difference.
I would also add that, in my humble opinion, the likelihood of a borrower being serious about paying his debt rather than shafting the lenders with inflated valuations is inverse proportional to the number of "projects" ongoing in parallel. If these borrowers were genuinely competent enough to simultaneously manage several large-scale development projects, they would not be taking out crowd-funded 13% interest loans. I, for one, would not have invested in any of these loans if I knew they were all connected.
Now, it is true that the borrower could have taken out loans on different platforms - that is one of the many unknown unknowns that inherently come with the risks of investing. However, in this case FS were well aware of the borrower taking out millions of pounds at high interest rates on different securities and, being silent about it, deliberately misled many borrowers into thinking a portfolio of these loans is less risky than it actually was.
|
|
james21
Member of DD Central
Posts: 651
Likes: 669
|
Post by james21 on Sept 28, 2019 6:26:22 GMT
It's also not against the law for a developer to work on more than one project at once. Yes this does concentrate risk but not increase it overall. While knowing more about the borrower is always useful I don't recall FS ever promising to let us know that borrowers had other projects on the go together with loans from FS or any other platform / finance provider. I agree with most of the things you said. However, what you refer to as "concentrated risk" is most definitely increased risk. Let us assume that, knowing the type of borrowers FS attracts, the probability of a borrower defaulting on his obligations is 30% (my sorry portfolio says otherwise, but let's be generous). If the borrower takes out three loans, the odds of all three loans going pear-shaped is 30%. However, if three unrelated borrowers took out those three loans, the odds of all three loans defaulting is merely 2.7%, a collossal difference.
I would also add that, in my humble opinion, the likelihood of a borrower being serious about paying his debt rather than shafting the lenders with inflated valuations is inverse proportional to the number of "projects" ongoing in parallel. If these borrowers were genuinely competent enough to simultaneously manage several large-scale development projects, they would not be taking out crowd-funded 13% interest loans. I, for one, would not have invested in any of these loans if I knew they were all connected.
Now, it is true that the borrower could have taken out loans on different platforms - that is one of the many unknown unknowns that inherently come with the risks of investing. However, in this case FS were well aware of the borrower taking out millions of pounds at high interest rates on different securities and, being silent about it, deliberately misled many borrowers into thinking a portfolio of these loans is less risky than it actually was.
Well put, I read recently the new FCA requirements to platforms will require greater transparency for lenders to see where loans are connected borrower. FCA states ""P2P platforms need to implement these changes by 9 December 2019""
|
|
kielbasa
Member of DD Central
Posts: 246
Likes: 411
|
Post by kielbasa on Sept 28, 2019 8:58:43 GMT
I think both pip and sqh have valid points - I see that this chap has over £6.5m of OUR money - as I said before when I borrowed money to develop the bank kept very tight control of my (their!) bank account and there is no way on this planet they would have let me get into this mess. To be fair to FS I don't think we don't (as yet) had proof that there is no audit trail but neither do we have proof there was one. So FS throw £6.5m+ at this chap and at least 5 of the 6 developments have or are expected to make a massive loss. So how do we know a couple of million or so has not gone walkabout - we don't! This chap has gone bankrupt so virtually no chance of seeing the money. I wonder if he is now living in emergency council accommodation - answers on a digital postcard. I thank you. Do we have evidence of this? I just had a look at the Insolvency Service website and my search had no matches. Of course, I could have done something wrong. I would be grateful if you would post a link or some other evidence on DD Central. Thanks.
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Sept 28, 2019 10:00:10 GMT
I read the below and was hopeful I might see some of my money soon and now I read To me these 2 statements are not compatible - if all documentation has been signed and agreed then I didn't expect the sale to fail! Looks to me as if FS have tried to sneak this in as if we wouldn't notice rather then inform us as soon as the sale failed. In fact I now wonder just how far advanced this new sale is - as the last sale failed after the DD then how do we know this one won' go the same way - we don't!
Even if this sale does proceed I would wager it will be at a very low price as I don't doubt the buyer knows this one is a lemon and he has FS over a barrel. I hope this one is wrapped up before 2020 but I doubt it - prove me wrong FS - I thank you!
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Sept 28, 2019 10:22:37 GMT
if you go to FS DD and look at the company you will see details of his company and under the insolvency tab:
17 Dec 2018 Appointment of receiver or manager
17 Dec 2018 Appointment of receiver or manager
17 Dec 2018 Appointment of receiver or manager
24 Apr 2018 Appointment of receiver or manager
I should have said this company is in receivership (4 actions). If you look at his accounts it looks to me as if it is only a question of time before these companies are wound-up. This chap was also in Hells Bells which is currently dissolved, for other companies we have e.g ** Sep 2019 First Gazette notice for compulsory strike-off etc etc - if it walks like a duck...
My mistake I should have been clearer although I would say he is currently ,in effect, already bust. Whatever I just can't how FS are going to get a penny out of him
|
|
james21
Member of DD Central
Posts: 651
Likes: 669
|
Post by james21 on Sept 28, 2019 10:32:12 GMT
they wont get a penny out of him as you say or from the valuers insurers but they have to go through the process and thats fair enough
|
|
arby
Member of DD Central
Posts: 910
Likes: 959
|
Post by arby on Sept 28, 2019 12:38:28 GMT
I read the below and was hopeful I might see some of my money soon and now I read To me these 2 statements are not compatible - if all documentation has been signed and agreed then I didn't expect the sale to fail! Looks to me as if FS have tried to sneak this in as if we wouldn't notice rather then inform us as soon as the sale failed. In fact I now wonder just how far advanced this new sale is - as the last sale failed after the DD then how do we know this one won' go the same way - we don't! Even if this sale does proceed I would wager it will be at a very low price as I don't doubt the buyer knows this one is a lemon and he has FS over a barrel. I hope this one is wrapped up before 2020 but I doubt it - prove me wrong FS - I thank you! FS said they were waiting on signed documents, not that they had received them, and as we all know, nothing counts until you've got a contract in hand, and even then, there's always a way or price to get out of it. Not sure where you're seeing the incompatibility in their statements.
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Sept 28, 2019 13:23:30 GMT
In my book a completed document is a signed one...however be interesting to see where we go with this new buyer!
|
|
bg
Member of DD Central
Posts: 1,368
Likes: 1,929
|
Post by bg on Sept 28, 2019 14:46:48 GMT
In my book a completed document is a signed one... What, even when they say in the same sentence that they're waiting for said document to be signed?
|
|
syalith
Member of DD Central
Posts: 62
Likes: 102
|
Post by syalith on Sept 28, 2019 15:53:17 GMT
I'm over the moon with this update.
I have large sum in the first charge loan and had half written it off in my mind. I'm not home and dry yet but with the new buyer paying a £25k deposit they certainly seem committed to buying it.
The biggest positive for me is the price, it seems to be more than enough to cover the first loan with interest even after receiver's costs which was my main concern.
I invested in this loan knowing that it had a high chance of failure but figured with the extremely low LTV and 15% interest rate it was a good investment to make, even in the event of a default, and it looks like my bet may have paid off.
I steered well clear of the lower ranking loans, having had my fingers burned in the past on a much smaller 2nd charge loan, but I can certainly see why so many would have invested in it, and none of those people deserve the outcome they are likely to get.
I'll be interested to see if Fundingsecure find any success going after the RICS surveyor and their insurance, as in my mind that surveyor is as much complicit in this as the fraudulent borrower. I don't see anything coming from the legal action against the borrower - he's probably on some tropical island enjoying his ill-gotten spoils.
|
|