Our fixed interest projects are proving to be popular, and we have just launched another for a property we are refurbishing in Halifax.
The investment period is twelve months, and we were recently asked by a potential investor if the funds could be returned to them earlier if they required the money.
We pay an attractive 8% p.a. after the UK withholding tax, and feel that if we allowed people to withdraw early with no penalty, we would be offering this rate on a ‘call’ basis. Investors can’t get 8% with a bank or other lender with immediate access to their money, and the higher rate does come with certain time obligations.
However, whilst there is an agreed investment period, we accept there are circumstances where an investor may need access to their funds. The funds we raise are tied up with the acquisition and refurbishment of properties, but as a group we always ensure we maintain adequate cash reserves to cover contingencies such as this. Accordingly, we are happy to facilitate an early redemption where possible, but the investor would have to accept that they would not receive interest for the period we have had the funds.
We believe in transparency (hence our comments here) and feel the above is a fair and equitable approach that benefits all parties.