Loan Notes are becoming the most popular form of alternative investment in the UK’s property sector. With increased affordability and free from the challenges of traditional property investment, Loan Notes offer investors a structured package designed to provide a regular flow of income and long-term returns.
Here are just six benefits of Loan Note investments:
Whereas a traditional Buy-to-Let (BTL) investment requires a large commitment of funds and costs can vary dramatically depending on location or repurposing the property. Loan Notes have a much smaller fee of entry that is far below that of the average BTL investment. Keystone’s Loan Notes are priced from £25,000.
It can be difficult to predict the return on a Buy-to-Let investment, considering fluctuations in property prices and rental yields, and additional costs (service charge or ground rent). Returns on Loan Note investments, however, are at a fixed rate and assured contractually, with Keystone’s offering investors up to 22% per annum. Investors have a good idea of the return they’ll see, and when they’ll receive it.
Clear Exit Strategy
Unlike traditional property investment, Loan Notes have a clear and predetermined exit. Not dependant on factors such as the ongoing sale of a property, Loan Notes provide investors have a certainty of term length and of exit point(s).
Hands-Off Passive Income Investment
There’s no dealing with tenants or maintenance, a Loan Note requires very little management, as you benefit from the effort and experience of industry professionals. All you need is a phone and a computer, to watch your income come in.
Keystone’s recently closed Flexible Loan Note gave investors the opportunity to choose their preferred term length (between 12 months and 7 years), growth or income options, and bonuses. If they chose to, our investors could also exit on the anniversary of the contract.
Loan Notes are a fantastic way to diversify your investment portfolio, offering something a little different from the norm. Once you’ve purchased your first, it’s also, easy to differentiate across several Loan Notes due to the lower cost of entry.