PROPERTY Pact has revealed its first projects are set to be funded in the coming months after the platform adapted its borrower terms.
The peer-to-peer lending platform – which lets investors back deposits for mortgage borrowers – was launched by former mortgage broker and developer Errol Woodhouse in 2017, but is yet to put any projects live.
Woodhouse explained to Peer2Peer Finance News that the platform has been working offline on its first two products so they can be used as case studies.
He said the platform also had to change its terms and conditions as the first bank it was working with was concerned about how borrowers would meet affordability requirements for their mortgage and the deposit loan.
Read more: First-time homebuyers ready to sell jewellery to fund deposits
As a result, borrowers will now pay 2.25 per cent over the Bank of England base rate rather than the previously proposed six per cent.
“The bank of mum and dad over the last few years has pretty much dried out,” Woodhouse said.
“This has left individuals who never had that support.
“There are a lot of organisations who have identified the problem and are trying to create a solution.
“We have definitely seen the mindset among lenders change.”
Read more: P2P start-up launches to help millennials on to property ladder
Woodhouse said there were two borrowers with an application in principle from their bank who now need to raise a deposit through the platform within 60 days.
He said he expects four to six investors to fund each borrower.
Woodhouse said the platform is currently working with one bank that supports P2P deposit lending but is in talks with others.
This article featured in the February edition of Peer2Peer Finance News, now available to read online.