Participate in a Property Development Loan & Earn Competitive ReturnsNov 3, 2017 Blog Investment Opportunity , Property Development Loan
We have a client on our platform that is offering a loan which enables you to take advantage of the thriving property market in the Western Cape, without having to own the property itself. Traditionally this type of investment has only been available through large capital investments but we are giving you an opportunity to invest as little as R1 000 to earn 18% p.a.
Important to note, this is not an equity investment into property, this is a loan, much like any other SME loan which has passed through our marketplace. By participating in this loan, you will be lending to the developer (the borrower) of a secure residential complex in Parklands North, Cape Town.
Loan Specifics: Term, Potential Return, Liquidity and Risk
Term and Return: 18% p.a. linked to a 12-month bullet loan, which is repaid in one lump sum at the end of the loan period. In other words, you lend the capital and after 12 months, you can expect to be paid out your initial capital + interest return – fees.
Liquidity: It’s important to understand that the only way you’ll be able to get your money out before the end of the term, is if the borrower pays off the loan early. If the loan is settled early, your return will be proportional to the actual period of the loan. So, if for example, the borrower decides to pay off the loan after 6 months instead of 12 months, there will be a 9% profit/return, opposed to the 18%. This is still in line with the 18% per annum return.
Risk: This is an unsecured loan, much the same as other SME loans on our marketplace. As such, the RF risk grading (c1) implies a similar risk as to SME loans with the same rating. In addition to the RF risk grading, Bowmans Gilfallan have drafted an independent Risk Assessment, which is available to you on request. Send us an email on firstname.lastname@example.org.
Minimum Investment Amount?
You can participate by investing as little as R1 000. Traditionally access to returns of this nature were limited to large capital investments i.e. hundreds of thousands of rand. You can enjoy the same advantages, with considerably less capital.
Is this the right investment for you?
Competitive returns, managed risk, and a low cost of entry are the primary reasons that should inform your investment decision. You can review additional information in the investor prospectus by clicking here.
Information contained herein is for information purposes only and is merely illustrative. It is not deemed as advice as defined in the Financial Advisory and Intermediary Services Act (FAIS Act).