We make every effort to minimise the risks for our investors and to ensure, where possible, that all investments are repaid in full and on time. To date we have a 100% success rate with our repayments. In the event that a borrower defaults on their loan we have the following protection in place:
- All loans are secured with a legal charge (mortgage), which means the property can be sold if the borrower defaults on the loan
- Loans do not exceed a maximum of 70% of the Open Market Value. This means that if the borrower cannot repay the loan it is highly likely that we will be able to recoup all funds from the sale of the security property, as there is a substantial amount of equity
- In the unlikely event that we are unable to recoup all the funds from the sale of the security we maintain a discretionary Provision Fund to allow us to compensate investors should there be a shortfall in the capital.
We feel it is important to make you aware that your capital is at risk and interest payments are not guaranteed if a borrower defaults, however we feel confident that we have a thorough and robust system in place to protect all Lendy investors.
Please see our information on Managing Risk here.