LinkedFinance - new website

lad6w

So Q4'17 Loan report now published. I did quick compare to Q4 last year. Last year the proportions of loans with any delay/active recovery/bad debt was circa 2%. Latest report shows that has jumped to circa 4% in one year. This confirms my own experience on the loans I am involved in. I expect the bulk of loans with any delay to end up losing me money. So slice  4% off my expected return, then the fees. I will not be changing my mind on staying invested in Linked.

sceach16

lad6w wrote: »

So Q4'17 Loan report now published. I did quick compare to Q4 last year. Last year the proportions of loans with any delay/active recovery/bad debt was circa 2%. Latest report shows that has jumped to circa 4% in one year. This confirms my own experience on the loans I am involved in. I expect the bulk of loans with any delay to end up losing me money. So slice 4% off my expected return, then the fees. I will not be changing my mind on staying invested in Linked.

My default rate is nearly 5% and my lates are another 3% making a failing rate of 8%. That is 8% of my loans. Started lendiing in August 2015. Mainly 36 month loans.

Linked figures are seriously misleading when they show default rates based on overall loans. 6 and 12 month loans are significantly less risky than longer term loans. Linked figures show about 4% failures overall.

Strettie11

2017 Q4 Loan Book Report
2015 issued loans default rate is at 3.96% !!!!!!!!!!!!!!!!!!!!

Only goes to prove the knowledge of the crowd was better than LF and their credit checks.

So many questions and issues were raised by members of this board about loans on the site in 2015 , so LF who has been proven correct .

Loan book reports now needs to show default by grade and loan period to see how good the loan grading is and interest rate on loans

garrettod

Hi,

IMHO, a 4% default rate is not terrible for the nature of this type of lending - but what is wrong here, is the risk-vs-return.

Linked Finance are not pricing a lot of their loans correctly, to reflect the level of risk associated with individual borrowers, and so by extension, investors (lenders) are not being compensated properly for the risk that we are being asked to take on.

There's also the obvious follow on regarding what action needs to be taken, and seen to be taken, with the borrowers in default so as to try and recover unpaid loans.

lad6w

I think as garrettod said 4% default IF priced correctly might be ok, but I think the trend of rapid increase in troubled loans, along with the pace of that trend is primary concern for me. As of this morning I have an additional 3 loans who have missed payments and based on prior experience I would expect 1 or 2 of them at least to go completely bad.

sceach16

Whitefriar Grill Loan 3292

Payment 23/36 due 29 Jan has not arrived. Other payments due today have.

Wheety

sceach16 wrote: »

Whitefriar Grill Loan 3292

Payment 23/36 due 29 Jan has not arrived. Other payments due today have.

This has been paid now.

Farm Foods has no update since October. Status of 'In Default'.

I wonder if they have any loans from a bank and if they are also in default.

Scottie99

“Six West Bistro “ late. I googled it, it’s permanently closed..

garrettod

Scottie99 wrote: »

“Six West Bistro “ late. I googled it, it’s permanently closed..

If that's the case, then describing the loan repayment as late is not a fair reflection of the current situation.

I would encourage you to contact Linked Finance regarding this, showing them it's permanently closed, and asking for a comment on why they describe it as late and asking what action is being taken etc.

It is possible that the guarantor has agreed to honour the remaining payments from other resources or something, but if that is the case then the people who have provided the loan need to be told same. If it's not the case, then the lenders need to be told what action has been instigated to recover the remaining debt due to them.

unadublin

garrettod wrote: »

Scottie99 wrote: »

“Six West Bistro “ late. I googled it, it’s permanently closed..

If that's the case, then describing the loan repayment as late is not a fair reflection of the current situation.

I would encourage you to contact Linked Finance regarding this, showing them it's permanently closed, and asking for a comment on why they describe it as late and asking what action is being taken etc.

It is possible that the guarantor has agreed to honour the remaining payments from other resources or something, but if that is the case then the people who have provided the loan need to be told same.  If it's not the case, then the lenders need to be told what action has been instigated to recover the remaining debt due to them.

In Arrears - We have recently been unable to contact the borrower in relation to this loan going into arrears. We will continue our attempts at contact but if no suitable response or payment is forthcoming by 07/02/18 we will be moving this debt over to our third party collections agency to handle and enforce the personal guarantees provided. Last payment received: 22/11/2017

unadublin

Ready Steady Build - Loan 4662
Grade D
Payment 2 of 24 missed 29th January

unadublin

Wheety wrote: »

This has been paid now.

Farm Foods has no update since October. Status of 'In Default'.

I wonder if they have any loans from a bank and if they are also in default.

is this the same place?
facebook.com/thefarmrestaurant

sceach16

unadublin wrote: »

is this the same place?
facebook.com/thefarmrestaurant

Yep....it is . Trading away to judge by social media and many previous comments on this site. Personal guarantee...

FinanceDublin

sceach16 wrote: »

Yep....it is . Trading away to judge by social media and many previous comments on this site. Personal guarantee...

Aye. Sure you’ve seen it yourself here over the last year at this stage, probably the most egregious flouters of the rule. I haven’t invested with them but would give serious consideration to walking out without paying for a meal and leaving a note explaining why. **** em.

On above, late payment at 2/24 doesn’t bode well at all.

FinanceDublin

Scottie99 wrote: »

“Six West Bistro “ late. I googled it, it’s permanently closed..

Just out of interest when did this loan start? I notice on Twitter they announced their closure in Feb 2017. Good while ago!

EDIT: just found the email from LF, 9/12/16! Then 8/12/17 they announce they’re shutting down their twitter and thank people for the last five years. Scarcely believable.

urgecaution

unadublin wrote: »

Ready Steady Build - Loan 4662
Grade D
Payment 2 of 24 missed 29th January

That's a quick fail! Hopefully just a delay.

Did you notice that Ready Steady Build is listed on LF as a Limited Company but in reality it (he?) is a sole trader? LF might want to be more careful about info they provide to prospective investors. Some might well be less inclined to support sole traders.

garrettod

urgecaution wrote: »

...LF might want to be more careful about info they provide to prospective investors. Some might well be less inclined to support sole traders.

There is no doubt that Linked Finance have an obligation to provide accurate information about a borrower.

Why not drop them an email and ask about this, just incase there was a change in status and the sole trader has recently incorporated under the same trading name or something?

As for the point about some people being less inclined to support sole traders, I don't think that should be a factor - as I've seen both good and bad, or successful and unsuccessful, sole traders, along with companies.

What needs to be remembered here is either way, we are relying on the Personal Guarantee(s) of the principal person / people behind the business, so does the legal status of a borrower really matter when the security is a PG either way ?

urgecaution

garrettod wrote: »

There is no doubt that Linked Finance have an obligation to provide accurate information about a borrower.

. . .

As for the point about some people being less inclined to support sole traders, I don't think that should be a factor - as I've seen both good and bad, or successful and unsuccessful, sole traders, along with companies.

What needs to be remembered here is either way, we are relying on the Personal Guarantee(s) of the principal person / people behind the business, so does the legal status of a borrower really matter when the security is a PG either way ?

As of this morning there is no such registered company but there is a registered business name.

Whereas I agree that the question of legal entity status should not be and often is not a true reflection of potential risk, there are those who would see it thus.

I have no problem with risk, plan my trades, trade my plans and find it prudent to assume PGs are worthless.

I would like to see the likes of LF prosper and as part of this they must avoid negatives beyond the inevitable percentage of business failures.

garrettod

Irish Biofuels in arrears

In Arrears - Still working directly with Linked Finance. The borrower has experienced issue with delivering their products to their customers in Asia and as a result they have struggled with cash flow. We are currently in discussions with the borrower and will update you on any changes. Last payment received: 28/12/2017

Peter File

garrettod wrote: »

Irish Biofuels in arrears

They made their payment today

sceach16

Just sent in this query......

Coleman Legal

This is a loan to a Sole Trader! But there is a balance sheet and a CRO number (519339). Do Sole Traders normally have CRO numbers ? How do they have a balance sheet?

Bank debt at 31.12.15 was 130K while at 31.12.16 it was 160k. Interest paid was 136 and 160 euro respectively.

Why would someone borrow from Linked lenders at 12.5% when they pay so little on bank borrowings?


Legal type
Sole Trader

Loan ID
4904

Legal name
Coleman Legal

CRO No.
519339

nsa0bupkd3948x

sceach16 wrote: »

Just sent in this query......

Coleman Legal

This is a loan to a Sole Trader! But there is a balance sheet and a CRO number (519339). Do Sole Traders normally have CRO numbers ? How do they have a balance sheet?

Legal type
Sole Trader

Loan ID
4904

Legal name
Coleman Legal

CRO No.
519339

519339 is a Registered Business Name for COLEMAN LEGAL. So it looks like a sole trader.

The company for 519339 is FUNSHOG GARDEN SHEDS LIMITED which looks unrelated.

Wheety

Farm Food Emporium Limited

Active Recovery - Case being handled by third party collections agency.The borrower had advised due to the Luas cross city works they had experienced a downturn but had advised once this was complete they would be able to return to payments and catch up on the outstanding amounts owed. Since the work was finished the borrower has failed to make any payment, so as a result we have moved this loan over to our third party collections agency to enforce the loan contract and personal guarantee provided. Last payment received: 09/10/2017

garrettod

The company for 519339 is FUNSHOG GARDEN SHEDS LIMITED which looks unrelated.

Got a good laugh out of this one, thanks


...


Getting back on topic, I'm actually a little surprised this loan has been given a "D" risk weighting, particularly given some of the ratings that we've seen applied elsewhere by Linked Finance. Their rating system continues to baffle (and concern) me !

garrettod

Wheety wrote: »

Farm Food Emporium Limited

Two good Dublin locations (one not anywhere near the Luas), both appear to be open, cash based businesses, and they've paid nothing. Says it all !

Another business for a bunch of P2P lenders to go possibly visit, run up a big bill, then tell the owner to offset it against the unpaid loan !

Wheety

Has anyone been through this with one of their loans? Does it mean there's no chance of getting the full amount back?

garrettod

Hello Wheety,

I would not write it off quite yet, but I would suspect that the chances of recovery are now quite low.

Much will depend on how quickly Linked Finance or the third party engaged by them, take clear and decisive action to collect the debt.

It might be no harm to keep a bit of pressure on Linked Finance, pressing them for updates on the action being taken.

If it were me, I'd want to see this particular loan being discussed in a courtroom asap.

FinanceDublin

garrettod wrote: »

Hello Wheety,

I would not write it off quite yet, but I would suspect that the chances of recovery are now quite low.

Much will depend on how quickly Linked Finance or the third party engaged by them, take clear and decisive action to collect the debt.

It might be no harm to keep a bit of pressure on Linked Finance, pressing them for updates on the action being taken.

If it were me, I'd want to see this particular loan being discussed in a courtroom asap.

Used to eat there the odd time. Maybe twice a year. It’s near work and grub is okay. Wouldn’t set foot in it again after how they’ve behaved here, and wouldn’t be shy about telling people either. I don’t have a loan with them but am truly disgusted. Would love to see someone who did lend them cash go and claim a free meal from them.

Krusty_Clown

They've made 22/36 repayments. If they are in trouble then reckless actions like this could result in none of the p2p investors getting any further returns. For most of us, what they now owe us wouldn't cover the price of a meal and eating a meal and not paying world be illegal. I'm not happy about losing some of the remainder of the money that Farm Foods owes to me, but at the same time, it was clear to me that investing in businesses through LF contained some element of risk and doing something that serves a couple of individuals at the potential cost of all of the lenders just doesn't make any sense. Best course of action is to do as others have suggested and put pressure on LF to recover what they can. When that process has dried up and if Farm Foods continue to trade in healthy terms then let the owners know how you feel about the process (using legal means). If they understand that their reputation is at stake (let's not forget LF encourages lending by a businesses own customers) maybe that will rattle the tree a little.

Cute Hoor

Krusty_Clown wrote: »

They've made 22/36 repayments. If they are in trouble then reckless actions like this could result in none of the p2p investors getting any further returns. For most of us, what they now owe us wouldn't cover the price of a meal and eating a meal and not paying world be illegal. I'm not happy about losing some of the remainder of the money that Farm Foods owes to me, but at the same time, it was clear to me that investing in businesses through LF contained some element of risk and doing something that serves a couple of individuals at the potential cost of all of the lenders just doesn't make any sense. Best course of action is to do as others have suggested and put pressure on LF to recover what they can. When that process has dried up and if Farm Foods continue to trade in healthy terms then let the owners know how you feel about the process (using legal means). If they understand that their reputation is at stake (let's not forget LF encourages lending by a businesses own customers) maybe that will rattle the tree a little.

Farm have 2 very popular restaurants in Dublin, in Dawson Street and Upper Leeson Street, both trading very well as far as I can see.

They have been casual at best with their payments to LF since last March. In August LF advised that they had been continually trying to contact Farm Foods receiving just one email in response with no reason or explanation for missed repayments, is this the way for a responsible business to deal with it's lender. Since then they have made one casual payment, without explanation it would appear. Since then the Luas works have been completed, thousands per day are being ferried down their street, they have just come through what is in Dublin city centre a goldmine Christmas period and they are presumably continuing to refuse to engage with LF. IMO LF need to go after them, and be seen publicly to go after them. I see nothing wrong with LF lenders going into their restaurants and having a free meal in compensation for their wait for/loss of their money, and doing it publicly.

I have absolutely no problem whatsoever with any business that I have lent to failing and thereby losing me money, none whatsoever, and that was the risk I knew I was taking when I lent that money in the first place. Indeed I have a lot of sympathy for them, they gave it a lash and it didn't work out, they opened up to LF, and good luck to them with whatever business venture they may undertake in the future. At the end of the day they are losing their business, maybe close enough to losing everything, I am losing a few bob that I knew I could afford to lose in the first place.