A peer-to-peer crowdfunding platform gives first time buyers the chance to catch the attention of investors and raise a housing deposit.
Property Pact has announced the soft launch of its new property platform, following the granting of permissions from the FCA for the platform to operate.
Property Pact allows prospective home buyers to borrow money to help fund the gap between their existing deposit and the “amount the bank want them to have” so that they can offer them a mortgage.
Errol Woodhouse, CEO of Property Pact said, “We can’t wait to bring our offering to the public at a time when there has perhaps never been more focus on the difficulties many people, especially the young, face in funding the purchase of their first home.
“While we acknowledge that there are mechanisms such as the government’s Help To Buy scheme available to some, at least for now, we have also been acutely aware of the restrictions the Scheme has, for example in restricting buyers to new-build properties. We are also conscious of the burden faced by parents, relatives and friends of young purchasers to help out financially without any security around repayment, and are sure that our platform will also provide them with a formalised way in which to help.”
Property Pact also enables parents and other investors to connect with borrowers and choose where they lend money, with a net return of 5% over the Bank of England base rate, and additional capital gain on the investment if the property value increases.
John Derry-Collins, Chairman of Property Pact added, “We are delighted to be able to be doing social good with this innovative offering, and also to provide families with a new way to help their relatives to own a property. The platform also allows for property investors to earn a decent return on their investment as an alternative to the low interest rates savers are typically finding are on offer.”