Responsible Secured Lending
Initiative Ireland loans are co-funded by our Impact Investor Community, to promote financial inclusion. However, we believe that co-funding platforms have a responsibility to be more responsible. That's why we only syndicate senior, secured loans, as per our own conservative lending appetite. We know that by working harder and being more selective, we can offer our community competitive returns with far greater levels of security, supporting responsbile financial inclusion.
What is Secured Lending?
This means loans which are not only subject to a loan agreement, but where there is also a charge over a specific asset provided as collateral on a loan. Typical examples are mortgage loans or car loans. At Initiative Ireland we provide property finance only where we can take a 1st legal charge over the underlying property, held in trust, on behalf of our lenders, just like a Bank would for your mortgage. There's a reason Banks charge less for a Mortgage than they do for an unsecured personal loan... because if something goes wrong, mortgages offer them security in the form of the property.
WHAT IS SENIOR LENDING?
Senior Lending means in order of repayment, our community must be repaid before the developer or any other investors. Normally if you invest or lend to a business and something goes wrong, you may find yourself in a long queue of people waiting to be repaid. With Senior Seccured Property Lending, we have first right over the property value. This means we can seize and sell the property to repay our community from the proceeds. Because we are a Senior Lender, other lenders or shareholders of the company are only entitled to what is left after our community members have been repaid in full.
Why We Lend...
Positive Social Impact.... at Initiative Ireland, delivering positive social impact is at the heart of what we do and why we do it. We assess all opportunities to ensure they deliver a positive societal and environmental impact, are sustainable and offer security and downside protection. That is why we offer financially inclusive products, like our Secured Lending Accounts to our lenders, and affordable development finance to our trusted borrowers.
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Case Study: North Strand, D1
We are proud to support social, affordable and mid-market residential housing projects across Ireland. As Ireland's largest peer-to-peer Secured Lending Platform, we have supported over €50m in developments to date and aim to significantly grow our lending in the next year.
North Strand Five Lamps, located in the heart of Dublin was one of our first loans financed through the platform. A project aimed at delivering 11 Social Housing Units suitable for elderly occupants, it also includes a ground floor cafe, providing additional amenities for this established city centre community.
A secured loan of €1,500,000 was provided in December 2017 to finance and commence the project and this was repaid in full by September 2018, ahead of schedule. In addition to delivering additional social housing and amenities to the local community, the development has delivered great returns to our lenders in return for their committed funds, which were at all times secured with a first legal charge over the property.
As a Passive build, it supports an household carbon footprint reduction of up to 20% per family and provides warm and fit for purpose housing to a vulnerable segment of our community.