Is Peer to Peer lending the way to get development money for your cohousing project? Although Bank of England interest rates remain low, the cost for cohousing groups of borrowing money from established financial institutions stubbornly refuses to fall.
Our new cohousing group from the Nether Edge area of Sheffield (http://onthebrink.community/who-are-we/) is soon going to launch their Peer to Peer offer. We need to borrow money in order to turn our wonderful, solid old building we have bought back into domestic (cohousing) use. We only need the money for a short period because once the 12 living units have been refurbished they will be sold to new members and our lenders can have their money back. Hopefully we will be able to find ‘peers’ with some savings that they will be prepared to lend to us at an interest rate they choose themselves (up to a maximum of 3%).
But how do we find these potential investors? Do other people within the cohousing movement have any experience of getting loans in this way? Hopefully our project will act as a pilot project for others trying this route. We are currently preparing all the legal and financial documentation needed and have even produced a short video describing our project. If you want to find out more, or have experience in this area please contact us otbcohousing@gmail.com
We will happily share our experiences.’
Note from Anna: From 6 April 2016 – the new Innovative Finance Isa (IF Isa) will enable peer 2 peer lenders to earn their interest free of income tax for the first time. We will be working with ‘On the Brink’ to see how this source of finance could be a potential addition to the current lending streams available.