Join other 4thWay HNW investors: harness your combined power for an even better deal.
Same loans, higher rates, more loans, risk guarantees. Join now for free!
Proplend: Now You Can Auto-Lend On 50% LTV Property Loans
Proplend has launched an auto-lend feature for its “tranche A” property loans, whether you lend through its regular account or its IFISA.
Proplend's tranche A loans are for a maximum of 50% of the property's valuation. Many loans are against properties that are earning income for the borrowers by being rented out (which have the highest, +++ Rating from 4thWay). Both those features give lenders huge downside protection.
If you switch on auto-lend, any outstanding funds you have in your Proplend* account will be lent on a daily basis, providing there are loan parts available.
A maximum of 20% of your entire pot will be automatically lent in a single loan. Your money might be allocated to new loan parts or you might buy second-hand parts from other lenders, depending on what is available. Proplend occasionally does four- or five-year loans, but your money will be allocated to loans of three years or less.
As I write, there are four qualifying tranche A loans available, paying an average 7.2%, which is very attractive for the risks involved.
Over time, as more loans become available and you lend more or re-lend repayments and interest, I expect that you will end up with an increasing number of loans that should turn out to be a sufficient number for these low-risk loans. The lower the risk, the less diversification is necessary to reduce your risks, so with Proplend you need far fewer loans than many other P2P lending sites to have good prospects.
The auto-lend feature will help to ensure you don't miss out on lending in tranche A loans. Proplend places lenders' money in £1,000 rounds, ensuring that more lenders can take part in each loan.
Once in a loan, your money won't be reallocated to different loans.
If you want to lend in a specific loan, you can toggle auto-lend off and choose a loan for yourself.
Read a Proplend Review from one of 4thWay's experts.
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.
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.
We are not financial, legal or tax advisors, which means that we don't offer advice or recommendations based on your circumstances and goals.
The opinions expressed are those of the author(s) and not held by 4thWay. 4thWay is not regulated by ESMA or the FCA. All the specialists and researchers who conduct research and write articles for 4thWay are subject to 4thWay's Editorial Code of Practice. For more, please see 4thWay's terms and conditions.
*Commission, fees and impartial research: our service is free to you. 4thWay shows dozens of P2P lending accounts in our accurate comparison tables and we add new ones as they make it through our listing process. We receive compensation from Proplend and other P2P lending companies not mentioned above either when you click through from our website and open accounts with them, or to cover the costs of conducting our calculated stress tests and ratings assessments. We vigorously ensure that this doesn't affect our editorial independence. Read How we earn money fairly with your help.