New lending platform Landbay claims to have completed the UK’s first ever buy-to-let mortgage funded through peer-to-peer lending.
A professional landlord has taken out the £175,000 mortgage on a two-bedroom terraced house on the south coast, built in 2011.
Funding for the mortgage has come from 85 people, each netting monthly returns of between 4.1 and 9.3 per cent interest depending on how much risk they take on. Risk is divided into three tiers based on different loan-to-value ratios.
The landlord will pay an aggregated three-year fixed rate of 5.12 per cent, with a five-year term, based on a 74 per cent loan-to-value ratio.
The loan is replacing an existing buy-to-let mortgage which was about to revert to 6.58 per cent after a lower fixed-rate period.
Market newcomer Landbay says it currently has a further five mortgage offers out with landlords, representing a further £750,000 of lending. The minimum investment for lenders is just £100.
Landbay CEO John Goodall said it was great for the company to get its first mortgage under its belt.
“We have a number of further buy-to-let mortgages in the pipeline, many introduced to Landbay by our mortgage broker partner Mortgages for Business, so we are very much up and running and expanding our ability to help the millions of frustrated savers in this country who would benefit significantly from a better deal.”
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