LANDBAY founder John Goodall has warned banks will struggle to lend without the cheap money from the Bank of England’s Term Funding Scheme (TFS).
The scheme, which launched in September 2016 and gave banks access to cheap money on the wholesale markets on the basis that they would lend more to borrowers, closed at the end of February.
Goodall (pictured) said mainstream banks had been propping up their lending with TFS.
“If doubling our total lending volumes in the past six months isn’t proof enough that the specialist lending model is well suited to the current climate, then the fact that traditional lenders have been propped up by the Bank of England’s Term Funding Scheme should be,” he said.
“As the scheme comes to an end and mainstream lenders can no longer rely on this source of cheap capital our proposition will become yet more competitive. I look forward to running with the opportunity this brings.”
His comments came as the peer-to-peer buy-to-let mortgage lender hit the £100m lending milestone.
Landbay, launched in 2014, said momentum had built since its loan book hit £59.56m last September, almost doubling since then.
Goodall said the lender was helping brokers secure funding more quickly for their clients, with a recent case completed within 18 working days.
It has been expanding its network of introducers and its product range, such as offering loans for houses in multiple occupation (HMOs.)
“We spent four years building a strong foundation for the business in an innovative and exciting financial space, but the past six months has been a real step change,” Goodall said.
“Lenders have been falling over themselves to help landlords and their brokers navigate an increasingly complex buy-to-let market, but it is the specialist lenders that have taken it in their stride.”
As Peer2Peer Finance News previously reported, Landbay had a record month in December when it lent out £10m, thanks to new institutional investment into the platform.