Proplend Platform FAQs
What is Proplend?
Proplend is a Peer to Peer Lending platform that connects investors directly to Borrowers with loans secured against income producing Commercial Property in England and Wales. Proplend specialises in meeting the loan requirements of the underbanked sub £5m loan market.
Who can become a Proplend Lender?
Residents of the United Kingdom of Great Britain and Northern Ireland are eligible to apply to use the Service as a Lender. For other countries of residence, excluding the Channel Islands and the Isle of Man (“UK”), you are solely responsible for ensuring that your use of the Service does not breach any laws, regulations or rules in your country (including those relating to tax payable on any gross interest received).
You must be at least 18 years old with a current account at a duly authorised financial institution that’s acceptable to Proplend.
*Residents of other countries are accepted on a case by case basis. Please contact us at firstname.lastname@example.org
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. For more information about Proplend borrowing, take a look at our Borrower Guide (PDF).
Is Proplend Ltd regulated?
Proplend Ltd is registered with the Office of the Information Commissioner (Reg No: Z3655272). Proplend Ltd is authorised and regulated by the Financial Conduct Authority, and is entered on the Financial Services Register under firm registration number 726646. Proplend Ltd is not covered by the Financial Services Compensation Scheme. Proplend Security Limited registered office is 145-157 St John St, London, EC1V 4PW (Company Number: 08620117) Proplend Security Ltd is registered with the Office of the Information Commissioner (Reg No:ZA014126). Proplend Ltd registered office is 145-157 St John St, London, EC1V 4PW (Company Number: 08315922).
How do the loans work?
There is a standardised Loan Contract between the Borrower and each of the Lenders, detailing the loan amount, the tranche, the interest rate, and the term of the loan. Proplend Security Limited (PSL), a wholly owned subsidiary of Proplend Ltd, enters into a single set of security documents with the Borrower and holds them in trust for the Lenders. PSL will take a 1st charge on the property offered as security (which is registered with the Land Registry). Proplend also retains the equivalent of 6 months’ interest on the account.
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.
What kind of loans are available?
The loans are fixed rate, interest only loans with up to 75% loan to value (LTV) of the property value. We will also consider shorter term Bridge Loans. Any property to be financed must be already owned by the borrower.
*Purchase money may be considered on a case by case basis
How long will the loan be for?
Loan terms range from 6 months to 60 months (5 years).
What size are the loans?
Loans amounts range from £150,000 to £5,000,000.
What are the loan repayment terms
Loans are interest only with the capital amount being repaid at the end of the term.
What is the loan Tranching?
The whole loan will be split across up to three Loan to Value based tranches, A, B and C. Tranche A up to 50% LTV, Tranche B 51-65% LTV and Tranche C 66-75% LTV. Interest rates vary per Loan Tranche.
When will loan interest payments be made?
Loan interest will be paid from Borrowers to Lenders on a monthly or quarterly basis, depending on the individual loan contract.
How do the Tranches differ?
The tranches are based on LTV ranges: the higher the LTV, the higher the perceived risk and therefore, the higher the interest rate. The tranches have pre-agreed priority as set out in the Proplend Members’ Agreement, Tranche A has priority over Tranche B and C, Tranche B is ranked after Tranche A but has priority over Tranche C. Tranche C is ranked behind both Tranche A and B.
Why have the Tranches?
Not every Lender has the same risk profile or return requirements. For this reason, we offer the loan Tranching model, which allows multiple Lenders to participate at up to three separate LTV levels. Each tranche offers its own risk profile and interest rate return. It allows a Lender who is restricted to invest only up to 50% LTV to participate in a loan with a borrowing requirement of 75% LTV.
Can Lenders invest in more than one Tranche?
Yes, a Lender can decide which Tranche to invest in and can invest in one Tranche or a combination of Tranches. They also determine how much to invest in each Tranche (minimum investment is £1,000*).
Can Lenders invest using their SIPP or SSAS?
Yes, Lenders can invest using one of our SIPP or SSAS preferred partners. Please visit our PENSIONS page for more information.
Does Proplend use the auction process?
The loans are not run on a classic auction basis where one Lender can under bid another. The interest rates at each tranche level are fixed and lenders invest on a ‘first come first lend basis’. If there is loan availability and you offer to invest, you will be successful.
How does Proplend make money?
Proplend charges Borrowers an Arrangement fee, being a percentage of the value of the loan. Proplend charges Lenders a service fee equal to 10% of the interest that they receive, only when they receive it. For more information, please visit our FEES page.
Which Professionals act for Proplend Security Limited?
A valuer from a leading UK firm of RICS qualified valuers will be instructed to value the property being offered as security. Keystone Law is appointed by PSL to act on its behalf for matters relating to Certificate of Title and Security.