What am I investing in?
You will invest in a specific loan secured against a specific property. If you are investing in a shared equity loan, the returns will be directly linked to the rise or fall in the price of the property. If you are investing in the fixed mortgage, the returns will be fixed.
How does the platform actually work?
Once fully registered on the platform, you can add money to your online account before selecting loans into which you wish to invest. You will receive monthly interest and you will receive back the capital at the point at which the loan is repaid. The amount you will receive will depend on the price of the property at that point.
Is my investment secured?
Your investment is not secured and you may lose your funds if the property cannot be sold or refinanced. However, the loan you make is secured by a mortgage on the property that is purchased.
Are my investments covered by the Financial Services Compensation Scheme (FSCS)?
No, investments in loans are not protected by the FSCS. However, any funds that are held as cash (not invested in loans) are held in a segregated client money account at Barclays Bank. This is a separate bank account that is ring-fenced from the monies of OnStep and these funds are protected by the FSCS to a limit of £85,000.
Can secondary market trading be suspended on a mortgage?
Yes, if there is any adverse report on the performance of the loan, such as rental payments not being maintained, secondary market trading may be suspended to protect new investors. Hopefully the likelihood of this happening is small given our strict tenant selection criteria.
Is OnStep regulated and authorised by the FCA?
Yes. OnStep is a trading name of Open Access Finance Limited, which is authorised and regulated by the Financial Conduct Authority (FCA) to operate an electronic platform in relation to lending, under firm reference number 741896.
What happens if OnStep ceases to exist or falls into financial distress?
We undertake to establish systems and processes in place to protect borrowers and lenders on our platform, in the event the platform fails for whatever reason, including insolvency.
We are in the process of appointing a reputed global back-up servicer, who would step in and manage the OnStep loan book in the even we cease to operate. The details of the back-up servicer will be made available to you before we originate any OnStep loans.