Opportunities that are flagged 'Property investments' are secured loans against a property. This gives investors the opportunity to invest in relatively lower risk opportunities.
The interest rate is lower on these investments, between 6% and 8%. A 'Charge' is taken against a specific asset, such as a director's home or commercial property. If the loan defaults then these assets may be seized and resold to repay investors.
Benefits of property secured loans
Why should I invest in low risk, property secured loans?
Property backed investment involves risk as well as potential rewards. If you’re looking for low risk investment you may consider this investment type. But remember, your capital is still at risk and may not be recovered.
If the loan defaults the asset can be taken and sold to repay investors. Hence, property finance offers better security, as there is a tangible asset, compared to unsecured loans that may just offer a director guarantee.
The main risk is retaining the valuation and ability to sell the property. Property secured finance is clearly labeled on the campaign page.
We conduct a strict due diligence check on businesses in order to manage risk and ensure that all investment opportunities listed on the platform will provide the best potential returns to investors.
When the loan is completed there is 100% loan to asset value on the property along with a suitable charge on the asset securing the loan.
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Maximise your returns with the IFISA
Our Property deals are IFISA eligible. That means you can include your investment within your 2017/2018 allowance and invest up to £20,000 tax free, before fees and bad debt, with the Crowd2Fund IFISA.
You can transfer previous ISAs and choose to invest part or all of this allowance during the current financial year.
Even though interest rates are lower with property secured investments all investors should build a balanced and diversified portfolio in order to help manage risk.
Repayments are made on a monthly basis back to your Crowd2Fund wallet. You can follow and manage your investment from your investment dashboard.
It’s free to register and the only fee we collect is 1% of the value of the repayments after a repayment is made. You can understand more about our APR here.