mikes1531
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Post by mikes1531 on May 7, 2017 18:18:59 GMT
I took the opportunity to write to Lendy on this subject, this was their response: "The Lendy platform operates a discretionary Provision Fund, In the event of a default, if we are unable to recover sufficient funds through disposal of the security, lenders can apply to the provision fund for compensation for any losses to their capital. ..." I couldn't get past the first paragraph without nearly choking on my tea. Aside from the fact that there seem to be two sentences in that paragraph but only one 'full stop', does anyone here remember anyone actually saying anything about applying to the PF for compensation after the PBL020 property was sold?
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on May 7, 2017 21:34:28 GMT
I took the opportunity to write to Lendy on this subject, this was their response: "The Lendy platform operates a discretionary Provision Fund, In the event of a default, if we are unable to recover sufficient funds through disposal of the security, lenders can apply to the provision fund for compensation for any losses to their capital. ..." I couldn't get past the first paragraph without nearly choking on my tea. Aside from the fact that there seem to be two sentences in that paragraph but only one 'full stop', does anyone here remember anyone actually saying anything about applying to the PF for compensation after the PBL020 property was sold? The lender presumably did and then the borrower used the money allocated to repay the capital. Given that the former and the latter were both Lendy I guess we wouldnt know anyway.
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Liz
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Post by Liz on May 8, 2017 17:40:17 GMT
I couldn't get past the first paragraph without nearly choking on my tea. Aside from the fact that there seem to be two sentences in that paragraph but only one 'full stop', does anyone here remember anyone actually saying anything about applying to the PF for compensation after the PBL020 property was sold? The lender presumably did and then the borrower used the money allocated to repay the capital. Given that the former and the latter were both Lendy I guess we wouldnt know anyway. That e-mail asking members to apply to the PF will go down like a lead balloon. The 2nd e-mail refusing 100% compensation will go down like a gold balloon. OK, the science buffs will see a flaw, but you get the point.
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Post by justdabbling on Aug 22, 2017 8:21:46 GMT
I found this response to a negative review about Lendy on another website. The thing that struck me is the response specifically states that lenders will lose capital unless sufficient funds are obtained from the borrower or sale of the security and it does not mention that losses could be ameliorated through use of the provision fund. So either Lendy are trying to quietly drop the provision fund or the response was inaccurate.
Dear AJ,
We always welcome all reviews, so thank you for the feedback.
Since introducing our new default policy in March this year, a small number of loans are appearing as being defaulted. They do however represent a small percentage in relation to the full book.
With property investment, there is always a risk of default but Lendy takes every reasonable step to prevent it from happening and takes a number of measures to protect investors from loss of capital. To date no investor has lost capital. Capital though is at risk with any form of investment.
Unfortunately, in the event that a loan goes into default, your capital will only be payable if we recoup sufficient funds from the borrower or the sale of the security property.
We do thorough due diligence on all loans and borrowers, please contact support@lendy.co.uk for more information on specific loans.
We are placing a lot of focus on repayments, with particular attention on resolving the default loan book. We are confident that you will see more regular repayment updates coming out.
Since appointing our new loan portfolio and Debt Recovery officer in July we have repaid 11 loans totaling £9.7m in capital repayments to our investors.
Please appreciate that loan repayments can be somewhat complexed and timely to recoup the funds owed by the borrower.
Kind Regards
The Lendy Support Team
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mary
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Post by mary on Aug 22, 2017 8:53:46 GMT
I found this response to a negative review about Lendy on another website. The thing that struck me is the response specifically states that lenders will lose capital unless sufficient funds are obtained from the borrower or sale of the security and it does not mention that losses could be ameliorated through use of the provision fund. So either Lendy are trying to quietly drop the provision fund or the response was inaccurate. Dear AJ, We always welcome all reviews, so thank you for the feedback. Since introducing our new default policy in March this year, a small number of loans are appearing as being defaulted. They do however represent a small percentage in relation to the full book. With property investment, there is always a risk of default but Lendy takes every reasonable step to prevent it from happening and takes a number of measures to protect investors from loss of capital. To date no investor has lost capital. Capital though is at risk with any form of investment. Unfortunately, in the event that a loan goes into default, your capital will only be payable if we recoup sufficient funds from the borrower or the sale of the security property. We do thorough due diligence on all loans and borrowers, please contact support@lendy.co.uk for more information on specific loans. We are placing a lot of focus on repayments, with particular attention on resolving the default loan book. We are confident that you will see more regular repayment updates coming out. Since appointing our new loan portfolio and Debt Recovery officer in July we have repaid 11 loans totaling £9.7m in capital repayments to our investors. Please appreciate that loan repayments can be somewhat complexed and timely to recoup the funds owed by the borrower. Kind Regards The Lendy Support Team The PF is still on the website under Investing->How it works, and was mentioned in this recent podcast...which stated there was still £3m in the PF... www.financialthing.com/podcast009-part2-lendy/
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Post by justdabbling on Aug 22, 2017 11:09:29 GMT
Yes, that is reassuring bearing in mind the number of late repayments and defaulted loans. Hopefully just a sloppy response to the review!
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Post by Lendy Support on Aug 22, 2017 14:25:46 GMT
Hi all, Lendy maintains the Provision Fund in line with the information on the website. Please bear in mind that the Provision Fund does not guarantee loans or provide insurance against loss. In the event of a shortfall after selling the security property, a claim will be made against the Provision Fund. The fund is held on a discretionary basis and Lendy cannot guarantee that any claim will be approved. We aim to maintain the Provision Fund at a balance of 2% of the live loan portfolio. It is important to understand that if the Provision Fund is used to cover a shortfall in asset disposal, it can take time for the Provision Fund to be increase to 2% of the live loan portfolio if funds are used to pay a claim. Every time a new loan is made a proportion of the fee charged to the borrower is paid into the Provision Fund (the amount is dependent on the loan size). Lendy Support |
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Post by justdabbling on Aug 22, 2017 14:56:58 GMT
Thanks for the clarification.
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boundah
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Post by boundah on Aug 22, 2017 16:34:57 GMT
Hi all, Lendy maintains the Provision Fund in line with the information on the website. Please bear in mind that the Provision Fund does not guarantee loans or provide insurance against loss. In the event of a shortfall after selling the security property, a claim will be made against the Provision Fund. The fund is held on a discretionary basis and Lendy cannot guarantee that any claim will be approved. We aim to maintain the Provision Fund at a balance of 2% of the live loan portfolio. It is important to understand that if the Provision Fund is used to cover a shortfall in asset disposal, it can take time for the Provision Fund to be increase to 2% of the live loan portfolio if funds are used to pay a claim. Every time a new loan is made a proportion of the fee charged to the borrower is paid into the Provision Fund (the amount is dependent on the loan size). Lendy Support My bold: 'In the event of a shortfall after selling the security property, a claim will be made against the Provision Fund'. I'm confused by the use of the passive voice here. Does that mean Lendy (or some mysterious agent acting on lenders' behalf) will make a claim and pay us? Or do we actually have to do something to claim our money from the fund?
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Aug 22, 2017 16:43:15 GMT
Hi all, Lendy maintains the Provision Fund in line with the information on the website. Please bear in mind that the Provision Fund does not guarantee loans or provide insurance against loss. In the event of a shortfall after selling the security property, a claim will be made against the Provision Fund. The fund is held on a discretionary basis and Lendy cannot guarantee that any claim will be approved. We aim to maintain the Provision Fund at a balance of 2% of the live loan portfolio. It is important to understand that if the Provision Fund is used to cover a shortfall in asset disposal, it can take time for the Provision Fund to be increase to 2% of the live loan portfolio if funds are used to pay a claim. Every time a new loan is made a proportion of the fee charged to the borrower is paid into the Provision Fund (the amount is dependent on the loan size). Lendy Support My bold: 'In the event of a shortfall after selling the security property, a claim will be made against the Provision Fund'. I'm confused by the use of the passive voice here. Does that mean Lendy (or some mysterious agent acting on lenders' behalf) will make a claim and pay us? Or do we actually have to do something to claim our money from the fund? Lendy will do it on our behalf. PF is a separate company with same directors. So I assume Tim & Liam will have detailed discussions with themselves to get the money. 
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mary
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Post by mary on Aug 22, 2017 16:45:35 GMT
Hi all, Lendy maintains the Provision Fund in line with the information on the website. Please bear in mind that the Provision Fund does not guarantee loans or provide insurance against loss. In the event of a shortfall after selling the security property, a claim will be made against the Provision Fund. The fund is held on a discretionary basis and Lendy cannot guarantee that any claim will be approved. We aim to maintain the Provision Fund at a balance of 2% of the live loan portfolio. It is important to understand that if the Provision Fund is used to cover a shortfall in asset disposal, it can take time for the Provision Fund to be increase to 2% of the live loan portfolio if funds are used to pay a claim. Every time a new loan is made a proportion of the fee charged to the borrower is paid into the Provision Fund (the amount is dependent on the loan size). Lendy Support My bold: 'In the event of a shortfall after selling the security property, a claim will be made against the Provision Fund'. I'm confused by the use of the passive voice here. Does that mean Lendy (or some mysterious agent acting on lenders' behalf) will make a claim and pay us? Or do we actually have to do something to claim our money from the fund? You don't do anything, but also you cannot dispute the outcome as its completely discretionary, so may cover all, some or none of any losses.
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macq
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Post by macq on Aug 22, 2017 17:13:04 GMT
in Latin its known as - Damned if they do Damned if they don't
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Post by charliebrown on Aug 26, 2017 2:43:49 GMT
I agree with those who say PF shouldn't be factored in to any risk calculation.
I'm not sure I agree with those who say PF should be abolished. Those who were invested in the Garden Centre wouldn't agree. What's the benefit to Lenders in calling for it to be abolished? Those calling for it to be abolished, can you explain why you want it abolished? Are you assuming that having it abolished would mean LY can offer Lenders higher interest rates, like the 13% FS offer?
The more worrying thing is, looking at the Defaults tab, PF or no PF, I think a lot of losses are going to be incurred and I'm wondering how that will affect Lender sentiment and the overall platform dynamics.
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Post by GSV3MIaC on Aug 30, 2017 20:35:30 GMT
Oh that's interesting, I wonder when that appeared?! (I have never seen it before so I guess it must be fairly new).
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ric
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Post by ric on Aug 30, 2017 22:11:18 GMT
how can the "expected recovery" item be larger than the actual losses/PF usage? Am i missing something?
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