Property-backed peer-to-peer lending platform Proplend has apologised to investors for delays in four loan realisations, after defaults rose in July.
In an investor update, the platform said that while July was “another productive month”, with three new loans being funded, seven loans are currently past maturity and four of those are in default.
“With four of these loans we can see a clear route to exit either through an in progress refinance or a sale, unfortunately in current market conditions, these are taking longer than expected,” said Proplend in a note to investors.
“Dealing with loan defaults is always difficult, between trying to balance returning lenders’ money as quickly as possible whilst ensuring the maximum possible value.
“It’s not an ideal situation by any means and we apologise for these delays and any knock-on effects this is causing.”
The platform has 51 loans in its current portfolio, split between commercial bridging loans and commercial mortgages. One loan was repaid in full in July, one loan was part repaid, two loans were in drawdown, and another loan has been fully funded and will drawdown in the first week of August.
All of the platform’s borrowers made their interest payments in July, despite the ongoing economic pressures of the pandemic. 100 per cent of interest due was collected and paid to lenders.
Furthermore, two borrowers who had dipped into their interest reserves in the early days of lockdown, have now fully replenished them.
Proplend added that although loan enquiries dipped slightly in July, the platform is “actively working in the background on this deal pipeline”, telling investors that they should expect to see some new loans coming to the platform over the next several weeks.