Understanding risk


Invest and Fund Ltd (“Invest & Fund”) is a secured lending platform, which matches property developers looking for funding with Lenders seeking an attractive rate of return on their capital.

For more information please view our FAQs page.


Borrower Profiles

The Borrowers are typically borrowing to finance a specific property transaction in the course of business and are required to use the underlying property as security for the loan. Additional security, such as certified personal guarantees and debentures, may also be taken if deemed necessary. The Borrowers can choose:
(a) Interest-only loans, with monthly interest payments over term ranging from 6 to 36 months; or
(b) Rolled-up interest loans, where no monthly interest payments are made but accrued interest along with capital is repayable at the end of the loan-term, which typically ranges from 6 to 36 months.

  Summary of the Main Risks

Understanding the Risks of Peer-to-Peer Lending

Invest & Fund matches Lenders who want a better return on their money with Borrowers who require a loan at a fair interest rate to fund a property development project. As with all Peer-to-Peer Lenders, the biggest risk posed to Lenders is if a Borrower does not repay their loan. Payments are not guaranteed if a Borrower defaults and so Lenders' capital is at risk.

Borrower Default

The main risk for Lenders is if the Borrowers do not repay the loan to the Lenders within the agreed time frame. If the Borrower does not repay the loan, the legal charge over the property can be exercised to settle the outstanding repayments. However, you should be aware that payments are not guaranteed if a Borrower defaults and for that reason, Lenders’ capital is at risk.

To view our current default rate, please click here.

Platform Insolvency

If Invest & Fund were to cease trading, there is a risk that Borrower repayments would no longer be managed effectively.
Invest & Fund have taken steps to ensure that in the unlikely event of insolvency, Lenders would be protected:

  • All Lender funds that are not on loan are held in a segregated client money account with Barclays Bank Plc
  • A separate entity holds the document, against which each loan contract is secured for the benefit of Invest & Fund Lenders
  • A third party administrator would take on responsibility for managing any outstanding loans.

Regulatory Procedure

Invest & Fund Limited is authorised and regulated by the Financial Conduct Authority (FRN: 711378). Peer-to-peer lending is not covered by the Financial Services Compensation Scheme (FSCS) and so if you suffer a loss, you cannot apply to the FSCS for compensation.

If you have a complaint you may be able to refer it to the Financial Ombudsman Service. Please see our Complains Procedure for further details.

Lenders’ Risk Assessment

One of Invest & Fund’s core values is transparency, and we strive to make all relevant information readily available for Lenders to be able to make an informed decision.
No lending opportunities will be made available on the Invest & Fund website until they have passed the Credit Assessment Group review.

Invest & Fund will provide you with certain factual information about the Borrower, to help the Lender reach an informed decision as to whether to participate in a particular loan opportunity. This will include information about the Borrower’s background, the nature of the request, a description of the asset, the Borrower’s financial performance to date, management analysis, the legal position relating to security for the loan and a review of these key risks and relevant mitigating factors;

  • Credit
  • Market
  • Property
  • Construction
  • Refinance

Please remember that Invest & Fund do not provide investment advice and if you have any questions about the suitability of a particular loan opportunity to you, please contact your Independent Financial Advisor.

Concentration Risk

Concentration risk is the probability of loss arising from a large exposure to a particular risk, for example an individual loan. Diversification is a risk management technique of mixing different loans in a portfolio, to reduce the concentration risk.

For that reason, you should consider spreading your exposure to risk by lending to more than one borrower. If a loan is not available for funding in the Lending Marketplace at any particular time, you can check the Resale Marketplace for opportunities to trade loans for previously-funded applications with other Lenders on our site.


I&F undertakes its own detailed due diligence on potential borrowers and their projects as well as seeking reports from professionals such as valuers, solicitors and surveyors, as appropriate. All of the loans are reviewed by Credit Assessment Group (CAG) who, between its members, have over 100 years’ specific credit experience. CAG considers whether loans meet our credit standards and only then will they allow a loan be able to be drawn down if it is successfully funded. Invest & Fund always ensures that there is borrower equity in any loan proposition, and there are legally enforceable guarantees in place.

Drawdowns being refused or unfunded

Property development loans are released in drawdown tranches against the measured progress of the development. Every drawdown request is reviewed by our Credit Assessment Group who considers the credit quality and must provide its sign-off otherwise the drawdown will not be allowed to progress. Although it has not happened to date there is also the possibility that the drawdown will not have attracted sufficient interest by the end of the auction, and so cannot progress. Either scenario may mean that the Borrower has to put in more of its own funds, restructure the drawdown or even seek refinance elsewhere. Any Lenders who have bid on a loan which has been refused or underfunded prior to drawdown will have their monies refunded. Lenders who are already invested in earlier drawdowns of the same scheme will have the benefit of the value of the security and guarantees if the scheme fails to progress. However, you should be aware that payments are not guaranteed and for that reason, Lenders' capital is at risk.