UK peer-to-peer lending platform, Landbay, has officially launched its property-backed ISA investment. This news comes just a little over a month after the lender was granted ISA manager status by HMRC. The Landbay team stated:
“The Property‐Backed ISA is the latest in our line of peer‐to‐peer investments following the introduction of the Innovative Finance ISA from HM Treasury in 2016. A Landbay ISA investment is the same as a Classic investment with a tax‐free wrapper.”
The platform noted that the total rate equals 3.75% annualized, this is assuming auto reinvestment of all interest over a 1-year period. The rate of interest may be fixed for up to five years before investors automatically switch to a variable rate. The investment starts earning interest within 24 hours of receipt of cleared funds, and there are no investment fees. Landbay also explained it would automatically diversify the investments across multiple buy-to-let mortgages with terms of up to ten years. Investors will receive monthly interest payments, which they can withdraw or reinvest.
CEO of Landbay, John Goodall, reportedly stated:
“When the chancellor first announced the IFISA would launch in April 2016, it was hailed as a victory for savers and investors alike. It’s taken a little longer than expected for products to pass regulatory scrutiny and reach the market, but we’re proud to be one of the first platforms to offer investors the benefits of the tax wrapper, and in time for the end of the tax year. At a time when investors are facing record low interest rates, and the prospect of rising inflation, our IFISA gives people the opportunity to earn a 3.75% return in a tax efficient manner, by lending to one of the UK’s best performing asset classes: buy-to-let. This is a fantastic opportunity for investors both this tax year and next, when the ISA allowance rises to £20,000.”
The lender also tweeted the exciting news:
— LANDBAY (@LandbayUK) February 20, 2017