JustUs launches professional property developer product
JUSTUS has launched a short-term flexible lending product aimed at professional property developers.
The Cheshire-based peer-to-peer lender said the new product will offer investors returns of up to 10 per cent per annum, with all lending secured by way of a first legal charge against UK property.
Investors will provide loans to developers for up to 70 per cent of the open market value of the property, through a special purpose vehicle (SPV). They will be repaid directly via the platform when the properties are sold or re-financed.
“We have been approached by a number of professional property developers recently to provide a short-term flexible lending product,” said Lee Birkett, founder and chief executive of JustUs.
“We have consulted with lenders and borrowers and feel the current price to risk is a market leader.
“One of the challenges that professional developers face, and the reason for creating this loan product, is the length of time that the banks currently take to approve facilities is ridiculous and not fit for business purpose.
“Most of these professional property developments are sold to pre-approved institutional buyers within three to six months, so working with the banks is completely impractical.”
Read more: JustUs opens first IFISA accounts
Borrowers will be paying lenders 0.83 per cent interest per month and a JustUs platform fee of 0.66 per cent per month for loan origination and administration.
“These are no questions asked, professional loans that are asset backed. It is short-term lending to provide a short-term solution,” Birkett told Peer2Peer Finance News.
“These assets are so good that once we can bring the ISA money in the interest rates will come down for businesses.”