Who can be a Proplend Borrower?
To become a Borrower on the Proplend platform you must be incorporated in the UK and be able to offer an income producing property in England and Wales as supporting security.
What types of properties do you lend against?
Proplend arranges funding for income producing commercial properties including office, industrial, leisure, retail and residential blocks in England and Wales. We do not accept empty properties or development projects or individual residential properties.
How do Borrowers contract with Proplend?
Borrowers are bound by the Proplend Members’ Agreement and Borrowers are required to formally agree to the terms before their Loan Request can be posted live on the Platform. Borrowers should read this document carefully and where necessary, take independent professional advice.
How do Borrowers contract with Lenders?
Borrowers and Lenders will be required to sign direct Loan Contracts.
Borrowers and Lenders should read this document carefully and where necessary, take independent professional advice.
How do Borrowers contract with Proplend Security Limited?
Proplend Security Limited will enter into a single set of security documents which will include a Charge Document and other security documents as determined by PSL. Borrowers should read these documents carefully and where necessary, take independent professional advice.
What information do I need to provide to make a Loan Request?
First you will need to register with Proplend by signing the Proplend Members’ Agreement.
Proplend will carry out the required KYC and Anti-money laundering checks, which will require identification documents. You will be required to complete a Borrower Application Form and then provide further information about the property, the tenants, and yourself as requested by Proplend.
What other information will be required to support my Loan Request?
A RICS qualified valuer will be instructed to value the property and your solicitor will be required to supply a Certificate of Title in a format acceptable to Proplend’s solicitors, Keystone Law. This will be completed before the Loan Request is listed live.
How will you decide if Proplend is prepared to post my loan request?
Based on the information provided by you, Proplend will complete an initial review of the loan request in order to determine if we believe it will be of interest to our Investors. Following this, we will request more detailed supporting information on both you and the property and Professional Valuation and a Report on Title will be instructed. Once we are happy with these, you will be asked to sign the Loan Request Document. Your loan will then be listed as live. The Loan Request Document plus all supporting documents including the Valuation and Legal Report will be viewable by all prospective Investors.
What are the costs are associated with the Loan Request?
- Completion Fee deducted from the loan at drawdown from the gross loan amount
- Valuation Fees payable directly to the Valuer
- Solicitor fees and any other professional fees
Is a completion fee payable?
Yes, this is agreed with the Borrower and is set out in the Loan Contract. The completion fee will be paid from the gross loan proceeds on day of loan closing.
What is the Break Fee?
If your Loan Request is successfully funded within the agreed funding period and you decline to accept the Lenders’ Offers, then you will pay a Break Fee of 2% of the monies raised.
When does the funding process end?
When either the funding period has expired or the Loan Request has been fulfilled.
What happens if you don’t get sufficient offers?
If at the end of the funding period, and insufficient offers have been received, the funding period can be either extended or the Borrower is free to seek funding elsewhere.
Is the interest rate that I pay fixed?
Can I repay my loan early?
Yes, you can repay your loan before the end of the loan period but if you do so, penalties may apply. These are loan specific and are set out in the Loan Contract.
How will I know if my Loan Request has been funded?
We will notify you by email as to the progress of your Loan Request.
What happens once the Loan Request has been successfully funded and the loan closes?
Keystone Law will carry out the remaining legal due diligence on behalf of the lender group. Once they are satisfied and the conditions of the Loan Contract have been met, you will be required to sign the individual Loan Contracts and complete the Security Documentation.
The gross loan funds will then be available for drawdown.
What is the difference between the gross loan and the net loan amount?
The gross loan amount is the amount indicated on the Loan Request. At closing we deduct from the gross loan amount any outstanding fees due to Proplend and other professionals (ie: completion fee), we will retain a minimum of the equivalent of 6 months’ interest due (Interest Reserve), we will redeem any outstanding loans that are currently secured against the property in order for PSL to take a 1st charge with no other charges outstanding on the property, and the balance is the net loan amount available to the Borrower.
What is the Interest Reserve?
At closing we will retain the equivalent of 6 months’ interest due on the loan. This will be held in the Interest Reserve Account and will be used to pay lenders in the event of a default. This is only a short term solution and the Interest Reserve Account must be brought back to the equivalent of 6 months interest, and all interest payments up to date. In the case of a Bridge Loan, we may retain the full interest due for the term of the loan.
Do you keep the full interest reserve account for the entire term of the loan?
When there are three months left on the loan term and assuming there are no arrears, costs or fees owing, we will distribute to the Lenders their pro rata share of the Interest Reserve as each repayment falls due. The balance of the Interest Reserve will be deducted from the final loan amount outstanding at repayment.
How is interest paid?
For administrative convenience, each Borrower will submit the Repayments due in a single payment to the Proplend Customer Funds Account, by direct debit or standing order. The payment will be recorded into the Proplend Account of each Investor.
Who are the Valuers that will act for the successful Lender group?
The firms who will act in relation to any particular loan will be selected from leading UK firms of RICS qualified Valuers.
Who are the Solicitors that will act for the successful Lender group?
Who do these Solicitors and Valuers act for and who pays them?
Appointed Solicitors and Valuers act for Proplend Security Limited and their fees are paid for by the Borrower, in the same way that a bank lender would expect these fees to be paid.