2. Investing with LendInvest

  • What am I investing in?

    An investment on our platform is an investment in an alternative investment fund connected to a specific loan secured against property. While the alternative investment fund is an unregulated fund structure, the investments are managed by our Alternative Investment Fund Manager, LendInvest Funds Management Ltd, which is authorised and regulated by the Financial Conduct Authority.

  • How does the platform actually work?

    Once fully registered on the platform, investors add money to their online account before selecting loans into which they wish to invest. Every loan is subject to different durations and available returns, depending on the circumstances in which the loan has been approved by our experienced underwriting team. Investors receive monthly returns on their investment and only receive back the capital they invested at the point at which the loan is repaid by the borrower.

  • How much can I expect to make on my investments?

    Your expected income (sometimes referred to as interest or return) differs, depending on (1) the investment product through which you are investing in LendInvest loans (for instance, a fund or our platform), and (2) the individual loan you have chosen to invest in (if you are investing via our online investment platform).

  • Is my investment secured?

    No, your investment is not secured. Your investment is in a loan secured on property. This means that if the borrower fails to repay their loan, LendInvest can seek to recover any outstanding amounts by enforcing the security and taking possession of the property.

  • Is my investment guaranteed?

    No. Investing in our loans is not a risk-free investment and LendInvest does not guarantee that your capital will be returned.

  • Are my investments covered by the Financial Services Compensation Scheme (FSCS)?

    As an investor on our platform, you may have the right to seek compensation from the FSCS should LendInvest become insolvent and unable to return money you are owed.

  • What does the FSCS cover?

    The FSCS may apply if you lose money because your investments have not been administered correctly, or as a result of misrepresentation or fraud, and the authorised firm concerned has gone out of business and cannot pay compensation or return your investments or any cash held on your behalf. The FSCS will not pay compensation if your investment performs poorly as a result of market conditions.

  • Will the FSCS compensate all of my investment?

    The FSCS covers 100% of your investment up to £50,000 should LendInvest become insolvent and unable to return monies to which you are entitled.

  • Does LendInvest operate a secondary market?

    No. Currently we do not operate a secondary market for investors. A secondary market allows investors to sell their investments if there are others that wish to buy them, before the end of the investment term. Investors in LendInvest investments are committed for the duration of the underlying loan into which they have invested.
  • Should I seek professional advice regarding investments?

    If you require guidance, you should seek advice from an independent financial adviser, solicitor and/or accountant. LendInvest and LendInvest Funds Management do not offer any legal, accounting, tax or investment advice.

  • What happens to my investment if LendInvest stops operating?

    We have a number of precautionary systems in place to protect investors and borrowers in the event that LendInvest stops operating. These include:

    Loan servicing partner
    All the loans that we originate and approve are serviced by the LendInvest team in partnership with a dedicated team at Pepper UK, part of the Pepper Group, a global loan servicing company that manages over £32 billion of assets across its servicing and lending businesses on behalf of 600,000 customers around the world. In the event that LendInvest was to stop operating, Pepper UK would continue to service borrowers’ loans as normal.

    Back-up servicer
    We have appointed Capita, a global business process outsourcing company, who would step in and manage our loan book, in the unlikely event that LendInvest was to become insolvent.

    Segregated client account
    We hold platform investors’ money in a segregated client account with Barclays Bank plc. If LendInvest were to become insolvent, an insolvency practitioner would be appointed to distribute the funds in the segregated client account back to platform investors. Money held in the segregated client account would not be distributed to our other creditors.

    Security trustee
    The security we obtain over the property is held under a separate trustee structure for the benefit of our investors. This structure allows us to minimise any costs as well as management of the different securities.

  • Is the income that I earn net of tax?

    No. The income (sometimes referred to as “interest” or “return”) you earn is gross of tax. You are responsible for your own tax affairs.

  • Can I include my Lendinvest loan investment into an ISA or a SIPP?

    Investments that are made available on our platform are structured as Alternative Investment Funds which are regulated by the FCA. Alternative Investment Funds are not able to be included in any of the currently available ISA wrappers.

    The LendInvest listed bonds are investment products that are publicly traded and can be included as part of a stocks and shares ISA allowance. You can find more information on the LendInvest listed bonds here.