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Peer2Peer Finance News | June 28, 2017

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Lendy hits £300m investment mark

Lendy hits £300m investment mark
Anna Brunetti

THE SLOWDOWN in bank lending prompted by the Brexit vote has helped Lendy hit the £300m investment mark in April, having channelled £50m to property borrowers in the last 100 days alone.

With new loans on the peer-to-peer platform often up to five times oversubscribed, the firm was able to add three larger-size loans over the last three months, it told Peer2Peer Finance News.

It directed £7.5m to the purchase and redevelopment of a commercial building in Marylebone, £5.7m to the development of a major residential building on Liverpool’s waterfront and £2.4m to the development of a major student accommodation complex in Huddersfield.

The firm said it was able to attract new inflows and originate loans at a record speed thanks to an increasing number of property developers and investors shifting to the P2P sector, as it is more efficient than traditional finance.

It doubled its investor base to almost 16,000 clients over the last 12 months also thanks to its ability to secure loans “against properties that banks would be unable to value confidently,” it added.

Read more: 2017 will be the year that P2P finally matures, says Lendy

“More and more property investors and developers have realised the benefits of getting their finance through P2P, and that’s driving strong growth for Lendy,” said Liam Brooke, co-founder of the platform.

The P2P and crowdfunding market recently passed £10bn funded to UK borrowers, while the sector has topped £100bn globally, the firm said.

“We have developed a reputation for being able to do deals that other sources of finance can’t – and to get them done fast,” said Brooke. “Our users’ ability to fund deals of £10m-plus means that property investors and developers can get the finance they need much faster than they could through a bank.”

The platform’s loan-to-value ratio is capped at 70 per cent, while a four-step due diligence process and returns of up to 12 per cent per year are also fuelling demand, he said.

“For investors, Lendy offers a blend of returns and security that continues to grow our user base at a significant rate,” said Brooke. “That shows no signs of slowing down as more individuals become aware of how they can benefit from the limited LTVs and due diligence on our loans.”

The platform published its default data on Friday, following the introduction of a revised policy in March.

Last week’s data showed that, based on the firm’s new default definitions, 3.2 per cent of its live loan book is in default status, 7.1 per cent of underlying loans are between 90 to 180 days late and 6.2 per cent are being serviced by the platform.

The remaining 83.3 per cent of the book is on track with payments.

Read more: UK supermarkets’ property slump creates P2P opportunities