But we do have about 30% of y our profile that features property

But we do have about 30% of y our profile that features property

But we do have about 30% of y our profile which has real-estate

Brendan: But we do have about 30% of our profile that features real-estate as security even though loans on their own could be similar to a busine loan, but where we are able to actually affix to property as security so we aren’t totally unsecured. I think can eentially be considered secured we are about 48% secured and maybe 52% unsecured consumer and small busine if you were to add receivables and real estate, both of which.

Peter: Interesting, interesting. Therefore then how can you select the lending company to do business with? I am talking about, are you searching for…obviously you have got a return target you’re signing up a new deal that you want to hit, but is there anything else that you’re looking for when?

Brendan: positively, therefore the initial thing that people desire to realize may be the story and that’s because unique deal movement is one thing we destination this kind of premium on therefore we wish to know how a loan provider is intending to measure and where it is getting its clients from in a way to ensure that they’re not contending against lots of other loan providers if not 1 or 2 other loan providers. They can find those borrowers and then once they have that and we understand how they’ll scale that then we’re going to dig into their data so we want those unique relationships where. You demonstrably understand Bryce extremely well, Bryce or Dr.Mason, another pioneer in this industry that arrived aboard more than an ago now and he’s our chief investment officer so bryce then digs into data year.

Just just just What we’re hunting for is two things; the very first thing of course we’re to locate could be the performance through the collateral in addition to thing that is second we’re looking are at the smallest amount of that the model that they’re making use of, the underwriting https://installmentloansgroup.com/installment-loans-de/ model that they’re using to get the loans could be the way to obtain their exceptional returns. In order to imagine a loan provider that is delivering exemplary comes back, but actually does not have a good underwriting model.

Peter: Right.

Brendan: so we need great data showing good performance and we need to be able to connect it to an underwriting model that we believe works because it’s actually smart humans that are making the difference there and of course that won’t scale. And because we’ve seen therefore a number of these underwriting models and Bryce himself has really built some, we’re exceptional judges regarding the relationship between good performance and also the underwriting model.

Then after that there‘s a lengthy screening proce because we’re audited and because we hold ourselves to an extremely high standard we do plenty of exactly what are called procedures testing therefore we’re to locate the control points during the lender…where their computer software and where in actuality the people intersect to do critical such things as ‘okay’ a loan, cable cash, exactly how cash is gotten and where all of that money goes generally there is a complete group of tests that people do in order to ensure that their busine is wholly buttoned down and then we might even have tips for them, we frequently do. When they’re throughout that there’s things like criminal background checks that happen after which we could arrive at a phrase sheet which will be a reasonably long appropriate document then reach an agreement that is definitive. It is maybe maybe maybe not an especially long proce if we’re really interested in the lending company, however it is a tremendously in level proce.

Peter: Yeah, it really feels like it. I do want to discuss the SEC therefore the filing you did…I’m sure we penned about this on Lend Academy back January, are you able to provide us with an change on that and what continued?

Brendan: positively, so that the method this works is you file what’s called an N-2 then you get comments back from the SEC and the comments reflected an interest that the SEC had in really very, very current valuation and if you look at the succe of the two firms that have launched in this space, they’ve both been able to do daily valuation if you’re going to create a closed end fund so we did that in December and. It is really difficult to day-to-day value a loan center that has a borrowing base. Banking institutions don’t do this on a regular basis, they might typically take action from month to month and thus than we do like a buyer of marketplace loans, the conclusion that we came to is that we just weren’t going to be able to get to daily valuation and that we would be well served by pulling the N-2 which is a simple thing to do because we look far more like a bank.