What are your criteria for lending?
The loans available through Octopus Choice are sourced through Octopus Real Estate. They are all asset-backed loans, which means that they are ‘secured’ against a physical asset, owned by the borrower, which can be sold if they fail to repay.
Octopus Real Estate only lends at conservative ‘loan to value’ ratios. For residential property, the maximum LTV is 75% (or, if the borrower chooses to add arrangement fees to the loan itself, 76%). In other words, a £750,000 loan would have to be secured against a property worth £1 million – giving a 25% cushion against any fall in the value of the property. For commercial property, the maximum LTV is 65%.
As the money you invest with Octopus Choice is lent to borrowers, returning your money and your interest relies on these borrowers repaying. We can't guarantee that you'll get all your money back or earn all your interest.
Before making any loan, Octopus Real Estate conducts due diligence on the underlying assets – including, where necessary, an independent professional valuation.
A review of each borrower’s financial position is also carried out, assessing their credit history, undertaking comprehensive identity and fraud checks, and making sure they have an acceptable ‘exit’ (i.e. that they'll be able to pay back the loan).
Octopus Choice puts your capital at risk. The value of your investment, and any income from it, can fall as well as rise and you may not get back the full amount you invest.