4thWay's Quick Expert CapitalStackers Review
Very attractive interest rates and takes loan checking to a whole new level
CapitalStackers* has completed under £10 million since launch in 2014. Its team could be one of the most competent we have seen doing development and rented property loans. It has many decades of relevant banking experience and it does appropriate risk modelling using professional firms – covering all the bases.
CapitalStackers takes diligence in checking and monitoring loans to a whole new level and they are beyond the comprehensive assessments we would usually expect for these kind of complex, high interest loans So far the size of the loans compared to the property valuations are excellent; for example, the average loan on rented property is just 51% of the property value, giving huge cover in a property crash if the property needs to be repossessed and sold.
Although new loans are currently few and far between, CapitalStackers has some very interesting opportunities for active, interested lenders to pick high-quality loans with very large profit potential.
“CapStack” lenders might typically put their cash down first – e.g. to assist a property developer in buying the land – and yet be just second in line for being repaid in the event a loan goes bad, behind another lender such as a bank (which provides the “senior debt”).
Lenders are compensated for the extra risks of this with interest of 8% to over 20%. We believe the interest lenders have earned is far more than required to cover the risks involved.
There have been no bad debts.
It is very transparent with 4thWay, providing huge amount of access and information so that we can get under its bonnet, including providing information it submits to the financial regulator and a whole lot more, giving me a lot of confidence.
CapitalStackers is already profitable – a rarity in the P2P industry which has a lot of new businesses. It is a small business but with very low costs, making it seemingly easy to sustain. It has backing from an accountancy firm and its founders are wealthy, currently lending one-third of the outstanding loans (although this will shrink as CapitalStackers grows). It has a network of connections that we believe will enable it to expand and grow further.
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