Past performance is not an indicator of future performance, and your capital is at risk in each investment.
For further information on becoming an investor or accessing your Investor Portal, please click the relevant link below.
For all enquiries related to investment, our dedicated team are here to help. Please fill out the enquiry form below and someone will be in touch shortly.
We bring together borrowers in need of short term lending with funding investors who are willing to lend on residential or commercial property.
Our investors select the specific loans they want to contribute to, rather than investing in a fund which is then allocated to underwritten loans. Investors can therefore manage exposure, asset allocation and risk profile.
West One enters into short term loans (often called 'bridging loans') with borrowers where the loan is secured on real estate property. The entity providing and managing the loan will be detailed through the initial terms as will its regulated or unregulated status.
The AIF Manager raises the capital required to make the loans underwritten by West One, from private investors. It is generally the case that the AIF Manager receives funding contributions from a number of different investors in respect of a single loan. A group of investors contributing to a single loan do not need to know each other and do not need to enter into an agreement with each other.
Subject to its fees and charges, AIF Manager will pay any interest it receives in relation to a loan and the repayment of the capital sum borrowed to the investors who contributed to the funding for that loan. An investor's entitlement is proportionate to the amount of their contribution against the overall loan.
West One enters into a loan agreement with the borrower and makes the loan to them. Investors do not make the loan themselves.
Yes, West One will take security over the relevant real estate when the firm makes a loan. Details of the entity making the loan (and therefore who will be taking security) and details of the particular security for a loan will be set out in the loan's term sheet. West One accepts responsibility to act to a good industry practice standard in taking steps to take out security over the relevant real estate. This duty may be discharged through the engagement of appropriately qualified and experienced solicitors with West One instructing them to effect the security on their behalf.
West One does not operate a loan opportunity allocation policy and does not undertake to offer loans of a particular profile to registered investors. Each loan offered will differ in terms of the identity of the borrower, amount to be borrowed, interest rates and property to be secured against. West One does not advise on or make any representation as to the merits of a loan either on its own account or relative to another loan.
The AIF Manager fees comprise a percentage of gross interest payments received on a loan before distribution to investors, which are detailed on the loan term sheet for each particular loan.
Fee* |
LTV** |
22.5% |
> 70.1% |
25% |
65.01% - 70% |
27.5% |
60.01% - 65% |
30% |
< 60% |
* The above fees are indicative only and could vary from loan to loan. |
|
** LTV (Loan-to-Value) is the ratio of loan to the value of an associated real estate property expressed as a percentage. |
You will not be required to contribute any further funds to fund the loan amount without your prior agreement. However please note: you may be required to contribute towards the cost of collecting or recovering sums due from a borrower in the event that West One, acting in the best interests of investors collectively, considers that it is necessary to do so. These costs may include costs or disbursements arising in connection with the appointment of third party providers (such as lawyers, auction houses, LPA receivers or debt collectors) or the reasonable costs of West One taking steps that are additional to or outside the normal course of their recovery process. Investors will be required to pre-fund these costs in proportion to their contributions. West One will be entitled under the loan agreement to seek to recover these costs from the borrower. If an investor does not pre-fund these costs West One will be entitled to set-them off against any sums recovered and due to that investor.
When funds are initially received (client money):
If The AIF Manager accepts an investor's proposed contribution, the investor will be asked to transfer the funds to a client bank account in the name of West One Loans Ltd.
When received, these funds will be held as client money in accordance with the Financial Conduct Authority's Client Money Rules. The funds do not pass through any other account belonging to West One entities.
Up until funds are released directly to the borrower or West One's solicitor, pending an advance (meaning a loan made or to be made by West One to a borrower), the AIF Manager continues to hold investors' funds as client money with a UK regulated bank pursuant to the rules of the Financial Conduct Authority.
While the funds remain as client money, they will be beneficially owned by the investors and in the unlikely event that West One Ltd becomes insolvent, the funds would remain the property of the investors and not be available to West One's general creditors. On a failure of West One Loans Ltd (and if certain circumstances are met) these monies receive protection under the rules of the Financial Conduct Authority – see the FAQ 'What claims are protected by the Financial Services Compensation Scheme ("FSCS")?'.
After funds are released (trust terms):
When West One releases the funds to the borrower or to the firm's solicitors, the funds cease to be client money and the trust terms automatically apply.
The purpose of the trust terms is to ensure that West One hold certain rights and property arising in connection with their loans on trust for the investors who contributed to the funding of that loan. Under the trust terms, whilst West One will have legal title to investors' funds, they will not have beneficial title. This means that in the unlikely event that they become insolvent, these interests will be held on trust for the syndicates of investors into each loan, and will not form part of the insolvent estate available for distribution to West One's general creditors.
West One maintains professional indemnity insurance.
It is a requirement for every loan made that the borrower insures the property to be used as security to its full reinstatement value and that the interest of West One as lender is noted on the policy.
In addition West One has in place a buildings contingency policy which only applies in the event that the borrower's policy lapses (the contingency does not address the adequacy of the borrower's insurance).
Additionally, West One may take out insurance specific to a particular property (e.g., title insurance) if it becomes specifically aware of a problem in connection with that property and its sole discretion, feel the problem could be mitigated by insurance. West One does not give any assurance that it will always identify problems in connection with a property and will rely on searches conducted by conveyancing solicitors.
It is important to note that any insurance taken out will be in West One's own name and investors will not be a beneficiary under the policy. Nonetheless, if West One suffers a loss and recovers under an insurance policy, where appropriate the AIF Manager will look to use these funds to recompense relevant investors if they have suffered a corresponding loss.
Some loans are regulated as products by the FCA on the basis they are made to consumers and are secured by way of a first charge of the borrower's residential property
Regulated lending is subject to a number of rules and regulations in terms of how loans are made and administered. West One will need to comply with these requirements in relation to its regulated loans. These rules are too numerous and specific to cover in this FAQ, but they relate to issues such as responsible lending, consumer duty, distribution, disclosure, and arrears management. In particular, West One will need to:
Yes, the minimum investment sum for a particular loan is set out in the loan's term sheet. Typically, the minimum investment is £25,000.
West One cannot guarantee that every borrower will meet all of their obligations to repay capital and interest due. From time to time some borrowers will default and an important ultimate protection in this regard is the security taken over the relevant property.
Industry standard identity and credit checks will be conducted in order to assess the borrower's identity and credit standing to the reasonable satisfaction of the lender. In addition, the relevant lender will confirm that the borrower has a repayment plan (the nature of which will be noted in the relevant Term Sheet provided to the investors for their assessment). In confirming the existence of a repayment plan the Lender is entitled to rely on statements made or information provided by the borrower about the plan and the Lender will not be obliged to assess or verify the viability of the plan, provided the statements, information and what it is told about the plan do not manifestly (i.e. on the face of it) lack credibility.
West One, as the lenders, will take reasonable care in assessing or as relevant confirming the above, but do not accept liability to investors for any loss caused by a failure to meet this standard of care unless the loss has been directly caused by the lender's negligence, willful default or fraud.
Examples of the industry standard identity and credit checks which a lender may, in its reasonable discretion, undertake if considered appropriate include:
West One may distribute details of potential loans to investors who have entered into a Participation Agreement and who indicate they are interested in making a contribution to the funding of a loan. Given the number of registered investors and the need to respond to borrower requests in a business-like timescale, it is impracticable for West One to offer every opportunity to all of its registered investors. Accordingly West One is not obliged to inform every registered investor about loan opportunities. West One will endeavor to contact all registered investors from time to time to inform them of an opportunity, but if you are actively interested in contributing to a loan we suggest you contact the firm directly.
West One will typically receive fees due from the borrower and that are deducted from the loan made to them, such as a loan administration charge and arrangement fee. West One will keep the administration charge. The arrangement fee is typically paid to or shared with an introducing broker but may be retained by West One on occasions where a broker is not involved in the introduction. West One may also deduct from a loan legal fees, insurance processing fees, broker fees and audit fees as these relate to the cost of borrowing.
When you make a contribution alongside other investors in respect of a particular loan, you are considered to be participating in an unauthorised alternative investment fund. You do not have a specific interest in the loan itself (see the FAQ 'Who actually makes the loan?'). Instead your entitlement constitutes a contractual right, under the Participation Agreement, and a beneficial right, resulting from the trust terms, against West One to be paid your share of any interest and capital collected in respect of a loan you have contributed to (see the FAQ 'How does West One Loans hold investors' funds?').
The Participation Agreement is between you, the AIF Manager and West One in its capacity as lender in order to ensure that there is an appropriate level of direct rights available. However, the AIF Manager takes responsibility for implementing and managing your investment and providing you with information about it.
Potential investors should consider carefully the details they are given about the terms of a proposed loan, the borrower and the associated real estate property as these details vary on a case by case basis. The AIF Manager or West One does not advise investors and it is the responsibility of the investor to ensure that any loan funding they want to participate in is suitable for them and that they have considered and are satisfied with all the details about that loan.
The risks include but are not limited to the following:
Borrower default: There is a risk that a borrower will not repay some or all of the interest due or capital borrowed and/or may make some payments late. This will have an effect on how much of a return an investor receives and when they receive it. West One Loans or West One Capital will take steps to recover payments due including by enforcing against the security it has in respect of the borrower's obligations. Note however particularly with regulated loans that reasonable steps to find solutions other than enforcement need to be taken (See FAQ 'What is the difference between a regulated and unregulated loan?'). The debt recovery process typically takes additional time and cost and it cannot be guaranteed that all debts will be recovered. See Could I be required to contribute more money after my initial investment? for situations where you may need to contribute to this collection cost.
Value of the security: West One will take security in respect of a loan against real estate property and will obtain an independent estimate of the valuation of that property. The 'loan to value' ratio is stated in a term sheet regarding a loan and indicates the extent to which the value of the property is estimated to exceed the amount of the loan. Property values may however fall and a property sale may not recover the estimated value of the property.
No secondary market or ability to redeem early: An investor's interest in relation to a loan is not assignable or sellable to a third party and there is no secondary market on which the value in a contribution to a loan can be realised. Investors cannot redeem their interest from West One Loan Ltd early. Accordingly a contribution to the funding of a loan should be regarded as illiquid and investors should assume that the only way to realise the value of their investment is for the borrower to repay the interest and capital.
Fraud: It is possible that a borrower or a person acting for them such as a solicitor could act fraudulently when borrowing funds. West One Loans and West One Capital and through their conveyancing solicitors will take commercially reasonable steps consistent with industry practice to mitigate against the risk of fraud but the risk cannot be completely eliminated.
Default of West One: It is possible that West One could suffer a default event and be unable to distribute entitlements. This is a potential risk that investors should take into account along with a number of factors that mitigate against this risk, including:
The AIF Manager would be pleased to work with you and your SIPP/SASS provider if you wish to fund a contribution through your SIPP/SASS. However, please note that none of the West One companies provide any tax advice or representation as to how an investment under the Participation Agreement will be treated for taxation purposes. There may be adverse tax consequences to investing in a loan through a SIPP and we would suggest that you speak to your SIPP/SASS provider and/or tax adviser before making such a contribution.
The interest to be charged on a particular loan will be set out in the loan's term sheet. In general, interest is paid monthly in advance however certain facilities are calculated on a daily rate and paid in arrears.
Interest will typically be applied on both regulated and unregulated loans on daily basis for the final month of the facility - for example if a loans is redeemed part way through a month investors will receive a reduced monthly payment in respect of that month.
Investors are entitled to receive their share in the interest earned on a loan that they have participated in during the lifetime of the loan. As payments of interest are typically due from borrowers on a monthly basis, the AIF Manager distributes the interest it or West One receives from borrowers on or around the 10th day of each month. An investor will only receive interest if the borrower of the loan they have participated in has paid it. The investor's share in any such interest paid by the borrower is proportionate to the amount their funding contribution bore to the amount of the overall loan.
Any interest or capital West One receives will also be transferred into a Client Money Account and held on investors' behalf by the firm as client money. Funds may be held prior to completion of the loan for up to 10 working days. Any further delays investors are notified with the option of having funds returned.
All amounts received or recovered by West One in respect of a loan to a borrower, or pursuant to the enforcement of all or any part of the associated security in respect of a loan, or any related rights shall be held by the firm as client money in accordance with the FCA's Client Money Rules.
When a borrower defaults West One acting in the investors' best interests taken together will take steps to recover the sums due. The lender will investigate the circumstances and determine in its sole discretion how best to recover sums due from a borrower. It is possible that West One will decide that a term extension or other restructure of the loan is the best option. Enforcing against the security over the relevant real estate property is generally a tactic of last resort once it is clear that other steps to recover the funds have failed. West One are obliged to act in the best interests of investors taken together who have advanced funds towards a loan when determining how best to recover funds on a borrower default.
For regulated loans certain rules and principles apply to how arrears can be recovered and West One will need to comply with these as a priority. See the FAQ 'What's the difference between a regulated and unregulated loan?'
West One will be the sole administrators of their loans and are not obliged to consult the investors who funded a loan or take account of any investor instruction in terms of how a loan is administered.
It is generally the case that more than one investor participates in contributing towards the funding of a loan. West One will act in accordance with what it, in its sole discretion, determines is in the best interests of investors in a loan collectively.
For regulated loans certain rules and principles apply to how loans can be administered and West One will need to comply with these as a priority. See the FAQ 'What's the difference between a regulated and unregulated loan?'
The FSCS covers claims in respect of certain business carried out by financial services firms. Where West One is in default the FSCS would protect a claim made by an eligible claimant in respect of a civil liability owed to that claimant by West One Loans in connection with its regulated investment business, where West One Loans is unable to pay the claim against it. Loss suffered as a result of borrower default will therefore not be covered by the FSCS, unless it can be shown that West One Loans has in some way incurred a civil liability to the claimant for that loss by failing in its duty or contract to the claimant.
Only eligible claimants can claim under the FSCS and this means it generally only accepts claims from individuals and small companies or small charities. Compensation limits are per person per firm (i.e., not per claim) and for West One Loan’s business the maximum compensation limit is £85,000.
In the event of the failure of the UK regulated bank with whom West One Loan holds investor's client money prior to their release to either West One Loans' solicitor or the borrower or borrower's solicitor, such funds should be covered by the FSCS. A compensation limit of £85,000 will apply.
Please note that where an investor funds a loan by themselves without any other participants the FSCS may determine that that investment does not form part of West One Loans' regulated investment business and is not covered by the FSCS.
Due to the size of some facilities West One may separately fund a portion of the loan. In these instances, both the interest and principal advanced with rank parri passu with all funders in that particular advance. On the occasions where West One is advancing funds against a particular security, for clarity, the below will be noted on the relevant Proposed Loan Opportunity Term sheet:
Each Participant, in agreeing to make a contribution to an advance, acknowledges and agrees to the following:
No, AIF Manager provides information for you to make a decision, but does not provide advice. You should not rely on communications with or from AIF Manager as being advisory in nature. It is always the investor's responsibility to ensure that any loan funding they want to participate in is suitable for them and that they have considered and are satisfied with all the details about that loan.
When considering making a contribution, investors may indicate to the AIF Manager that they have preferences in terms of the characteristics of the loan, the borrower or the real estate security. The AIF Manager is under no obligation to take account of such preferences when offering participations to such investors. Where the AIF Manager does seek to take account of an investor's preferences, is in no way advising or recommending a contribution in that particular loan and takes no responsibility for ensuring that the loans meets the investor's preferences.
Investors must inform the AIF Manager immediately in writing upon becoming aware of any actual or potential conflict of interest between the investor and a borrower. It is, however, the AIF Manager's decision alone as to whether to proceed with the investment to the borrower. If the investor has already agreed to make a contribution, and then notifies that they are aware of an actual or potential conflict of interest affecting the contribution, the AIF Manager will (in its sole discretion) decide whether to proceed with the investment.
On occasion a borrower may seek to increase the term for repayment of the loan. In circumstances that do not amount to borrower default, West One will only agree to such an extension if all investors who have participated in the loan are in agreement and the firm's origination process is satisfied in respect of the request. If one or more participants do not wish for the extension to be granted West One will either seek to find replacement participants or alternative funding.
Please see the FAQ 'What happens when a borrower defaults?' for information regarding the agreement of term extensions in the event of a borrower default.
What is the purpose of the schedule of loan participation?
Within five working days of the advance made by either West One, the AIF Manager will provide the investors with a schedule of loan participation. This document will set out details such as the loan completion date, loan redemption date and the investor's proportion of the loan.
A Variable Rate loan may be offered on unregulated or regulated bridging facilities. Term Sheets will make clear these are variable rate facilities. The Bank Base Rate (BBR) will be advised along with the annualised return to an investor. Each time there is an increase or decrease in BBR the return to investors will increase or decrease accordingly. Any BBR changes will be reflected at the next monthly interest payment date. The BBR will be floored at 0.75% so there will always be a minimum return advised.