LandlordInvest reveals more than 50pc of B and C rated loans have been paid on time
LandlordInvest has published the performance of its loans by risk rating, revealing that more than 50 per cent of B and C rated loans were paid either on time or early.
The analysis includes all loans originated on the peer-to-peer property lending platform since it started trading in 2017.
A-rated loans had no history of any issues and a 100 per cent record of being repaid on time. However, the majority of LandlordInvest’s lending takes place in the B and C categories, with some also in D.
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Loans with risk rating D experienced some sort of issue 92.9 per cent of the time, and were only repaid on time in 18.2 per cent of cases, much less than B and C which were repaid 51.3 per cent and 55.6 per cent of the time, respectively.
“It’s possible that LandlordInvest’s platform lenders don’t mind that some loans are repaid in full after their original maturity date as they still receive interest during this time, and in some cases a part of that interest may be paid at a higher rate due to penalty interest charged to temporarily delinquent borrowers,” the platform said.
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LandlordInvest noted that loans in default have either gone on to be repaid in full or are currently still being dealt with. It said that at the time of writing there has been no capital loss on any platform loans.
A large percentage of loans in categories B, C, and D have been extended at least once. In some cases, these extensions were between six and 12 months, often in conjunction with partial capital repayment, in response to special economic circumstances such as COVID.
Other extensions might have been made when there were no particular issues with the loan. For example, a borrower with a performing loan might contact the platform prior to maturity to let it know about delays in refinancing or sale of a security property, the platform said.
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