Wellesley & Co peer-to-peer savings guide
Most peer-to-peer companies lend money out to individual consumers or businesses. With Wellesley & Co, your investment is secured against residential property instead.
How does it work?
The company chooses small to medium-sized residential property investors looking to buy rental properties, and then matches them with savers looking for market-beating returns.
The average deposit of between £10,000 and £15,000 is typically split between three properties. Account terms range from six months to five years, while the interest rates on offer vary dependent on the term you choose.
You can invest from £10 upwards and there is no maximum investment limit.
What are the risks?
Wellesley & Co limits the risk to savers by only offering mortgages for up to 50% of an investment property’s value. It also carries out credit checks on the property investors taking part.
The properties will be sold at auction to retrieve savers’ money should anything go wrong, while Wellesley & Co also has a provision fund that will pay out if an investment fails.
This is held in trust by an independent third party and currently amounts to double the sum needed to reimburse its customers (based on a default rate of 2%).
You do not, however, qualify for Financial Services Compensation Fund protection, meaning that you could lose your money should the company go bust.
Comparing savings accounts
If you want to maximise your returns, it is vital to compare savings accounts before choosing one and to check regularly that your existing account is not leaving you out of pocket.
Browse hundreds of savings accounts, including peer-to-peer plans, to find your perfect savings match at MoneySuperMarket.