25 Peer-To-Peer Property Lending Websites

You have dozens of choices when it comes to peer-to-peer property lending. As far as we know, we’re listing every single one of your choices on this page that we at 4thWay consider to be P2P lending. The majority of P2P property lending websites offer…

CapitalStackers Review

CapitalStackers’ Property Lending Account/IFISA currently has two alt ratings of secured and hidden gem, as we have no doubt it will receive the top 4thWay PLUS Rating soon, when its history is sufficient. These loans have been paying lenders an average interest after bad debts. Visit…

The 9 Best Peer-To-Peer Lending Accounts In The UK 2024

My team and I have been assessing P2P lending accounts since 2014 and we continue to have a 100% record. (We won’t always get all the most important calls right – that’s impossible in investing – but we expect that we almost always will.) My…

Proplend Review

Proplend’s Tranche A, 0-50% LTV Lending Against Property Mostly Receiving Rent received an Exceptional 3/3 4thWay PLUS Rating. These loans have been paying interest after bad debts. Visit Proplend* or keep reading the Proplend Review.

HNW Lending Review

HNW Lending’s Property & Asset Lending Averaging 55% Average LTV received an Exceptional 3/3 4thWay PLUS Rating. This manual lending account is paying around interest after losses from bad debts. Its auto-lend account pays 7% with additional borrower interest covering rare losses. Visit HNW Lending*…

Best Innovative Finance ISAs In 2024

What are the best Innovative Finance ISAs? The best innovative finance ISAs are these nine, which offer a market-leading risk-reward balance: Assetz Exchange IFISA. (Minimum £1 per loan.) CapitalRise IFISA. (Minimum £1,000 per loan.) CapitalStackers IFISA. (Minimum £2,500 per loan.) CrowdProperty IFISA. (Minimum £500 that…

Assetz Exchange Review

Assetz Exchange’s P2P Lending Account And IFISA And Classic Account has earned an Exceptional 3/3 4thWay PLUS Rating. These loans have been paying lenders around of the loan amount in interest, after bad debts. Visit Assetz Exchange* or keep reading the Assetz Exchange Review.

CrowdProperty Review

CrowdProperty’s Bridging & Development loans received an Exceptional 3/3 4thWay PLUS Rating. This account has recently been paying lenders interest after bad debts. Visit CrowdProperty or keep reading the CrowdProperty Review.

IFISA Guide Up to 5th April 2024

We have nagged the taxman’s notoriously tight-lipped officials, and chased down accountants, IFISA providers and even 4thWay’s own skilled experts to give you answers to all your IFISA questions, as well questions you never thought to ask. Here goes: What is an IFISA? An IFISA…

The Peer-To-Peer IFISA Guide

Two great have had a cascade of effects throughout this guide, so there are lots of updates. Those changes are: You can now make new contributions into as many IFISAs as you want, at any time. The last of the restrictions on partial transfers of…

IFISAs: What Are The Risks?

The key risks in IFISAs are: Psychological risk: your own greed and fear. Concentration risk: you don’t spread your money across lots of loans and P2P lending sites. Credit risk: borrowers don’t repay you. Platform risk: the P2P lending site (the “platform”) goes bust and…

Loanpad Review

Loanpad’s Premium Account/Premium IFISA received an Exceptional 3/3 4thWay PLUS Rating. This account has been paying interest after zero bad debts. Visit Loanpad* or keep reading the Loanpad Review.

CapitalRise Review

CapitalRise’s Bridging & Development Loans have earned the Exceptional 3/3 4thWay PLUS Rating. These loans have been paying lenders around  interest after bad debts. Visit CapitalRise* or keep reading the CapitalRise Review.

Downing Crowd Review

Downing Crowd’s Senior Property & Renewable Energy Lending is unrated, due to lack of information. These loans have been paying lenders around interest before bad debts. Visit Downing Crowd or keep reading the Downing Crowd Review.  

Invest & Fund Review

Invest & Fund Lending Account received an Exceptional 3/3 4thWay PLUS Rating. This account has been paying in the regular P2P lending account after fees. It pays in the IFISA, due to slightly higher fees. Visit Invest & Fund* or keep reading the Invest &…

How To Lend Across Multiple IFISAs In One Year!

As you may know, you can only open one IFISA in a tax year, which runs from the 6th of April to the 5th of April, and this limits your ability to spread your money and the risks across lots of providers. Opening more than…

Crowd2Fund Review

Crowd2Fund’s Business & Property Lending is unrated, due to lack of information. There’s not enough info to calculate the annualised interest rate earned by lenders after bad debts. Visit Crowd2Fund or keep reading the Crowd2Fund Review.

Assetz Capital Review

Assetz Capital’s 90-Day Access Account continues to earn an Exceptional 3/3 4thWay PLUS Rating. After bad debts, which are usually paid for by a reserve fund, Assetz Capital is targeting for lenders. Visit Assetz Capital or keep reading the Assetz Capital Review.

ArchOver Review

ArchOver’s Mostly Secured Business Loans are unrated, due to lack of information. We estimate these loans have been paying lenders around interest after bad debts. Visit ArchOver or keep reading the ArchOver Review.

What ArchOver does

ArchOver primarily does UK business loans that are largely secured on whatever business assets are available, with a preference for the business’s outstanding customer invoices.

It also does unsecured loans to give businesses an advance on tax credits, grants and tax reliefs, such as the research and development tax relief.

Loans are from £100,000 and up to £5 million. The average loan is around £250,000, although many borrowers have lots of ArchOver loans simultaneously.

Its secured loans can last up to two years and unsecured loans for up to one year. Loans can be repaid at the end, with interest paid regularly. Or they can be repaid monthly. A hybrid is common too, where some of the loan is repaid with interest every month, but a large final lump sum is repaid at the end.

When did ArchOver start?

Established in 2014, lenders using ArchOver have technically lent £160 million to business borrowers. This figure is possibly overstated due to a substantial proportion of loans being effectively extended by being renewed, but 4thWay is not provided with the full data.

What interesting or unique points does it have?

ArchOver’s owner, Hampden Group, has lent millions of pounds through the ArchOver lending platform, which I previously wrote is one of the most promising signals.

However, while that was the case as late as summer 2021, we have no recent information on how much the Hampden Group continues to put into the loans.

ArchOver review: how good are its loans?

The types of business loans ArchOver approves require a lot of individual, human analysis, so the P2P lending platform can’t rely to a big extent on credit reports and automated checks, to approve large numbers of loans to provide safety for lenders.

What we know about the quality of the loans is limited. We know that ArchOver wants to see that the borrower is likely to be able to meet the monthly loan payments.

Borrowers need to provide company accounts for the past two years as well as up-to-date management accounts (that’s ongoing accounting reports used by management), which is good.

The latest information we have is that secured loans must be for less than 90% of the value of security (e.g. less than 90% of the outstanding amounts on customer invoices), which is reasonably standard for loans that are secured in this way.

The type of security usually seen on ArchOver loans is not as strong as real property security usually is, so lenders should certainly be prepared for some losses on a good proportion of the loans that turn bad, until ArchOver proves it can do better.

ArchOver appears to allow borrowers to keep borrowing, sometimes to repay previous loans. Many borrowers borrow 5, 10, 15, 20 or more times through ArchOver.

While such repeat borrowing can be perfectly reasonable, it can also be the primary means, and easiest route, for a P2P lending company to hide problem debts. The problem is, we have next to no information on any of this.

Recognised bad debts tend to arise in very large lumps – far, far larger than the average loan size. I think the most probable reason for this is that borrowers have borrowed repeatedly before getting into trouble.

Without sufficient openness from ArchOver in terms of detailed data, results and explanations, this is a huge gap in our knowledge of this platform. The rate of repeat borrowing or refinancing is so high that 4thWay – and lenders – really require a lot of information on it.

I noted in the last ArchOver Review update that it had shown signs of consolidating its loan types and removing features of its lending accounts that didn’t work so well, which could improve the overall quality of the loans – and make them easier for lenders to understand.

There’s some circumstantial evidence the improvements continued through 2022, as you’d expect after roughly eight years of operating. This includes arranging more loans where borrowers repay part of the loan as they go, rather than at the end. It also has fewer loans where all the loan and all the interest is repaid in one go at the end, which makes it easier to spot problems with a borrower earlier on and reduce losses.

However, with the limited information available, I’m not able to form a strong opinion on loan quality.

ArchOver arranges loans with firms that it itself does business with, which is not ideal. As far as I’m able to see, it doesn’t always reveal this to lenders.

How much experience do ArchOver’s key people have?

ArchOver’s lending practices are driven by viewing prospective borrowers from an accounting perspective, for which it has significant experience and training.

Its people have some prior experience in credit analysis or similar, although this is limited and not at a senior level. I would like to see more.

Its key decision maker was promoted this year. With eight years at ArchOver in relevant roles, it must be meaningful experience that he has acquired. While we have previously met and interviewed some of the ArchOver team on several occasions, we haven’t had a chance to interview him.

ArchOver review: lending processes

In a previous version of the ArchOver Review, I noted that ArchOver had not made it clear to us whether it uses credit reports in its processes. We now know that it does, although its provider, Wiserfunding, is a new one. As such, we have not yet had the chance to assess the quality Wiserfunding’s scoring system.

Over the years, ArchOver has added to the tools and processes it uses to assess borrowers, and so we have seen it mature.

Personally, I’d prefer that ArchOver begins its research from a quantitative, analytical and impersonal approach from a distance.

But, the way they have described it, they get into personalities and a qualitative assessment first.

In my view, this can lead to errors from personal bias, and it also gives the borrowers more opportunity to use their charm and interpersonal skills to influence what ArchOver’s people later see in hard numbers and facts.

That aside, ArchOver’s processes on the whole sound reasonable and competent. Experienced underwriters, accountants and credit-committee members should be able to make good decisions if applying their skills to those processes and maintaining their discipline.

There are a lot of repeat themes in terms of the types of businesses ArchOver approves, indicating that it sticks to businesses it believes it understands.

ArchOver puts a great emphasis on monitoring borrower’s cash flow, their accounts and security, on a monthly basis, with the cash being diverted to flow to an ArchOver-controlled bank account in the first instance.

ArchOver’s focus on the borrowers’ ability to meet monthly payments and repay the loan is reassuring; for these kinds of loans, it should not be relying heavily on the borrowers’ security.

Nevertheless, ArchOver is big on borrower covenants, such as keeping enough cash on hand to meet the next loan payments, plus a little extra. It also uses negative pledges, which reinforces lenders’ security by making it harder for businesses to borrow substantially elsewhere using its assets as security.

These legal clauses, combined with strong monthly loan monitoring, reduce the risk of eventual losses from bad debts. They also reduce – but certainly don’t eliminate – the risk that ArchOver is rolling over poorly-performing debt into new loans.

How good are ArchOver’s interest rates, bad debts and margin of safety?

Total paid to lenders in interest has reached £13.1 million.

Superficially, it appears that loan amounts that have turned bad – which is at least £9.4 million – are outweighed by interest that has already been paid to lenders – and that’s even before taking into account any recoveries that ArchOver has made on those loans.

If this is the case, the risk-reward balance has been good and is likely to remain so for the foreseeable future.

We have insufficient information to see whether problems are bubbling under the surface or to conduct an analysis of margin of safety. However, as the years go by, this risk is sinking somewhat. I had expected deep cracks to have become visible by now, if there any were going to appear on ArchOver’s opaque wall.

Has ArchOver provided enough information to assess the risks?

I had hoped that, by now, we’d have a lot more positive news about ArchOver’s transparency. However, by any objective measure, ArchOver doesn’t provide as much information as many other P2P lending companies to either 4thWay or the public.

We have next to no information on repeat borrowing, little information on bad debts and bad-debt recoveries, and zero data on late loans.

We have insufficient information to measure the effectiveness of security offered by borrowers, or of the mitigation of risk inherent in covenants and loan monitoring.

Information provided to the public directly is also thin. ArchOver describes its processes on its website quite well, but lacks important supporting information on its people and its results. It provides very limited aggregated figures to show the current status of its outstanding loans and borrowers.

We know that it also makes very substantial mistakes in its aggregated figures. For example, showing nearly a million in loans that turned bad during 2017, but years later amending it to just half-a-million that turned bad that year. (Most likely the amendment was an error – but how many of those has it made?)

However, for logged-in users, ArchOver does provide detailed reports into individual borrowers. I believe it also communicates well with lenders when there are any problem debts.

A lot of the gaps in information are inexplicable. Reviews by lenders left on TrustPilot (after stripping out reviews from borrowers) are mostly very positive. Not universally, but in the main.

Circumstantial evidence suggests that ArchOver is not deliberately trying to hide problems, but perhaps rather suffering from lack of resources. Yet some key, missing pieces of information would be easy to provide, so the reasons are unclear.

The bottom line is that I believe 4thWay doesn’t receive sufficient information to truly assess the results and the risks and, therefore, whether the interest rates sufficiently cover the risks. If we don’t get it, you can be sure that individual lenders don’t either.

Is ArchOver profitable?

ArchOver isn’t yet profitable. However, it’s owned by a much larger and profitable business, Hampden Group, which provides insurance services. ArchOver appears to still be well supported by its parent, both financially and with services.

After cost cutting in 2019, losses were halved in 2020 to half a million pounds rising again slightly in 2021, according to accounts published in 2022. Revenue is around £1 million. I expect ArchOver is still some years away from becoming profitable.

Nevertheless, financially, ArchOver is very sound.

Is ArchOver a good investment?

It’s not possible to say with high confidence at this stage whether ArchOver is a good investment.

What is ArchOver’s minimum lending amount and how many loans can I lend in?

The minimum lending amount is fairly high at £1,000 per loan.

In a big change since I last updated the ArchOver Review, it’s now re-categorised its “Investment Plans” as legacy products, which puts it in a category of other types of loans or accounts that it has tested and moved on from.

Those plans were the only way to do automated lending with an automatic spread across loans. It also enabled smaller amounts to be lent in each loan.

It was a good idea; shame it’s offline, but I hope they replace it with something else.

You can reduce your risks by not lending to borrowers who borrow repeatedly, although that reduces the number of loans you can lend in.

In the past six months, 17 unique borrowers have borrowed through ArchOver.

You will probably need to drip your money in to lend to as many unique borrowers as possible over the course of more than one year to contain the possible risks.

ArchOver is therefore most suitable for people with deeper pockets.

Does ArchOver have an IFISA?

ArchOver’s lending accounts are available as IFISAs.

Can I sell ArchOver loans to exit early?

No. But do remember that selling before borrowers naturally repay is a luxury item that doesn’t always work anyway. Good lending strategy is to assume that you’ll need to lend until the borrowers repay naturally.

Thank you for reading this ArchOver Review! Visit ArchOver.

ArchOver: key details

Interest rate after bad debt

6.85%

Here we show the P2P lending site's own estimate (or 4thWay's if theirs are not appropriate)

4thWay Risk Score

N/A

Lower Risk Scores are better. How is this different to the 4thWay PLUS Rating?

Description

£160 m in loans to profitable businesses since 2014, mostly secured, with some loans having insurance that might cover some losses, optional auto-lend & auto-diversification. Available in an IFISA

Minimum lending amount

£250

Exit fees - if you sell loans before borrowers fully repay

N/A - no early exit possible

Early exit is not guaranteed. Usually, other lenders need to buy your loans

Do you get all your money back if you exit early?

N/A

Loan size compared to security value

90% (max) usually

Reserve fund size as % of outstanding loans

No reserve fund

Company/directors lend alongside you/first loss

ArchOver's owner, Hampden Group, currently lends over £4m on equal basis with other lenders (as of 2018)

Independent opinion: 4thWay will help you to identify your options and narrow down your choices. We suggest what you could do, but we won't tell you what to do or where to lend; the decision is yours. We are responsible for the accuracy and quality of the information we provide, but not for any decision you make based on it. The material is for general information and education purposes only.

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The 4thWay® PLUS Ratings are calculations developed by professional risk modellers (someone who models risks for the banks), experienced investors and a debt specialist from one of the major consultancy firms. They measure the interest you earn against the risk of suffering losses from borrowers being unable to repay their loans in scenarios up to a serious recession and a major property crash. The ratings assume you spread your money across hundreds or thousands of loans, and continue lending until all your loans are repaid. They assume you lend across 6-12 rated P2P lending accounts or IFISAs, and measure your overall performance across all of them, not against individual performances.

The 4thWay PLUS Ratings are calculated using objective criteria that can be measured and improved on over time, although no rating system is perfect. Read more about the 4thWay® PLUS Ratings.

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