If you are fortunate enough to be a successful punter, and I hope that after following this blog in time you will be, then there will come a point in time where you wonder how you should put your hard won profits to good use, and I have found what for me is the ideal solution, P2P investment in commercial mortgage securities via Lendy.
Let’s face it, the interest rates offered by the banks are ridiculously low right now. And while that may improve in the future, I was drawn to Lendy as a possible solution to short term investment with a decent return and I have not been disappointed.
I started investing with Lendy last year after spending a lot of time researching the offering, determining the validity of the business model, and by talking to others who had invested with them. I never heard a bad word, so took the plunge and as a result I’m earning an average of 12% on money that was previously earning less than 2%, while helping property developers and investors to further their projects and build their property portfolios.
All sound in the knowledge that my investment is security backed. Meaning that money lent by Lendy to developers and investors is backed by the security of physical property – unlike a lot of person-2-person lending platforms that offer unsecured borrowing with limited recourse on default.
Because of the nature of the funding Lendy provides, short term development and bridging finance, that means the money is not tied up for long periods of time. The ‘bridging’ nature of the loans appeals to me and was one of the strong factors that swung me towards investment.
I also like the fact there is no minimum amount of investment required. I am one of many who have helped finance multi-million pound projects, with small amounts of capital spread across many such developments and property.
Lendy has a couple of safety nets in place for investors. They provide a fund to compensate investors should an actual default ever occur, which to date it has not. And while it is not guaranteed that this fund will cover any or all losses, it is reassuring to know it exists when some unsecured P2P lenders are doing away with this feature – increasing the risk to lenders.
I also like the fact that Lendy will not provide financing that exceeds 70% of the valuation of the property. Add to this the thorough vetting system they use prior to lending, the ongoing management of each loan, and the regular valuer visits and updates to lenders, it all adds up to a great investment with big upside and small downside. The type of investment I like to make!
The average loan period for me is around 150 days, and I am comfortable with that. Any surplus cash is put to get use, earning a decent return on investment, helping others, and providing a compounding investment opportunity as I reinvest all interest each month, again on average at 12%. Nice!
With over £360 million lent out by over 18,000 investors who in turn have earned over £34 million in interest, this has to be something to look at if you are serious about putting your money to work when its idle.
As always, do the research yourself, determine the positives and negatives before making a decision, and I am sure you will reach the same conclusion as me… this is a no brainer!!! Get on my son!
- Transparency: As part of their business model, Lendy offer a Reward Program for introducing new investors. If you invest £1,000 or more and keep it there for 3 months I will earn a 5% bonus based on the interest you earn over a 12 month period. In addition, if you click on the link above you will personally receive an additional £50 bonus if you deposit £1,000 and keep it invested for a 3 month period.
- Disclaimer: NO part of this blog post should be construed as financial advice. I am not a financial advisor. What works for me, and the experiences I have had may or may not reflect your own experience and as everyone’s financial situation is different you should seek independent financial advice before investing your money.