Many business owners do not need to borrow from a bank. Entrepreneurs are often able to privately arrange loans with wealthy individuals, perhaps with the assistance of a solicitor. Through the rebuildingsociety.com Private Peer Loans offering, borrowers and lenders can arrange their loan quickly and cost effectively.
How It Works
A business creates a private loan profile listing, by providing the loan application information. rebuildingsociety.com then reviews the application in line with its credit risk analysis policy and awards a risk rating. The loan profile is created, available only for the borrower to share by private invitation. Borrowers are given a link to their loan profile, which they can distribute to trusted investors. This has the advantage of keeping key performance information private.
Private Peer Loans can be arranged on either an amortising or an interest-only basis.
The arrangement fee for an amortising Private Peer Loans is 3.25%, which is used to pay for the setup of the legal agreements and to administer the formalisation of the 36H loan agreement, in accordance with regulatory peer-to-peer lending standards. There is no margin taken between what the borrower pays and what the lenders receive.
There is no arrangement fee for an interest-only Private Peer Loan. Instead, the platform takes a fee of 13.3% of each interest repayment the borrower makes to the lenders.
This has several advantages.
Benefits for the Borrower
- Privacy: Keep key performance information confidential
- Confidence: Invite known and trusted investors
- Exclusive: Pay interest to your invited syndicate members
- Flexible: No early repayment fees, and the option to refinance or restructure or amend repayment terms (may require the consent of lenders)
Benefits for the Lender
- Tax advantages: Use your ISA allowance/bad debt is tax deductible
- Formalisation: Your loan is arranged on commercial terms documented on a loan agreement drafted by us
- Security: Missed repayments are chased by rebuildingsociety.com, who will enforce the security in case of default
- Communication: The discussion forum makes it easy to get updates on business performance and to interact
Let us be your partner in arranging your private loans. By using our loan agreement template and regulated platform, you are able to provide reassurance to your lenders and make the most of our easy-to-use interface to manage communications with your group of investors.
Simply select the option Loan Syndication: Private when applying for a loan. We will then review your application, and work with you to create your unique loan profile. Borrowers also have the option to choose to request an unsecured business loan.
If you choose to promote your loan to your investors, financial promotions need to be clear, fair and not misleading, so our compliance team will help to make sure your messages to invite your investors are compliant.
Watch the video below to find out more about the simple and straightforward rebuildingsociety.com application process.
