FundingSecure Review

We have undertaken numerous reviews on peer-to-peer lending schemes but the following one on FundingSecure is particularly interesting. This is perhaps because it revolves around the borrower pawning a luxury item such as a classic car, watch, diamond ring, gold, or a piece of fine art.

FundingSecure commenced trading in July 2013 and, as at 2 June 2014, had made available loans totaling £1,120,709.

Let us look at the scheme in a little detail:

To whom do FundingSecure lend?

They will provide finance to individuals.

How much can be borrowed?

The minimum advance is £500 with the maximum being £100,000. The maximum term for a loan is 6 months. The savers, who provide the funds to be lent to the borrower, have the comfort of knowing that the loan is secured against the asset that has been pawned. These assets are valued by professional auction houses. The maximum loan to valuation is usually 70%.

Purpose of loan

There is no restriction on what the loan monies can be used for. For instance, funds may be required towards a deposit on a house, an injection of funds into a new business start up or to pay for a holiday.

Interest rate and charges

The borrower is able to dictate the fixed interest rate as they decide upon the rate that they are prepared to pay. To date (2 June 2014) the average rate set by borrowers is 12.66% per annum.

In addition there are FundingSecure's administration fees that vary depending upon the amount of the loan ranging from 2.4% per month for an advance of £1,000 to £2,499 to 1.2% per month for an advance of £35,000 to £100,000. For yachts, vehicles, fine arts and other large items an additional 0.5% per month is payable.

Interest and charges are applied monthly

The borrower also pays for the cost of transporting the item that is being pawned should the loan be set up with this sum being added to the loan. Typically, taking all the above into account, the overall APR could be in the region of: £1,000   loan    55.7% £2,500   loan    50.4% £5,000   loan    41.3% £10,000 loan    40.5% There is no penalty for early repayment subject to a minimum term of 30 days. All capital, interest and charges are repayable when the loan is repaid.

Procedure

The loan application process is quick and simple.The borrower can calculate how much it will cost to borrow the money by using the online calculator and then fill in the loan inquiry form. The borrower dictates the interest rate they are prepared to pay the saver within a range of 5% to 20% per annum.

The asset is sent in by the borrower by one of several ways or can be delivered by hand when it will be professionally valued for free. Hopefully, savers will agree to fund the loan.

Once the loan has been approved an electronic loan agreement is signed and the funds paid into the borrower's bank account within 24 hours.There are no credit checks. If a reasonable interest rate has been set then FundingSecure expect it to take up to 4 working days for the loan to be funded.

The asset is stored securely and released to the borrower within 5 working days of paying off the loan, interest and charges. If you feel that the above peer-to-peer lending scheme is of interest feel free to speak to one of Choice Loans experienced staff on 0845 1260350.