The administrators agreed a settlement with the valuer and insurer following a meeting
Administrators winding-up collapsed peer-to-peer property lender Lendy have successfully claimed £625,000 against a valuer for a property which may have been £2m over-valued.
It is believed to be the first successful action taken against a valuer by the administrators to help recover short falls in loan recoveries, and was revealed in the latest half-year update.
Administrators have been taking action in many ways, including on personal and corporate guarantees or making claims for negligence against third-party professional advisers.
In this case, following a mediation meeting in October, the administrators agreed a settlement with the valuer and insurer for £625,000.
According to details on the Lendy website, the property in Leatherhead, Surrey was valued at £4.25m in February 2016 with a loan of £2.975m granted to refinance the original loan help complete works on it.
However, the developer initially completed the works without planning permission which required further funds from Lendy to bring it back into line with regulations.
Eventually, a valuation from a third party of £2.25m was given in early 2018 as the top sale price in that area and a buyer purchased the property for £2.1m – leaving investors £1m short.
Speaking at the NARA property receivers conference last month, RSM Restructuring Advisory partner Damian Webb who is overseeing the recovery of as much capital as possible for investors, said one of the biggest issues at Lendy was the accuracy of valuations.
He confirmed that only around 30 per cent of the original values are being collected on average against outstanding loans.
Speaking about wider issues with valuations within the peer-to-peer sector, and not specifically those at Lendy, Webb noted a lack of processes where borrowers were allowed to appoint their own valuer.
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