How are Fluid Bond investments used?
Fluid was designed with the intention to offer bridging loans within the unregulated business-to-business lending market. The loans will be provided to businesses for use in a multitude of projects, with a particular focus on property.
A bridging loan is a type of short-term loan intended to provide immediate finance pending the obtaining of longer-term finance or receipt of capital, and are generally taken out when quick access to funds is needed. Bridging loan applications tend to be much quicker than other financing options, and are therefore an ideal option in these situations.
Bridging loans are primarily used in both business and real estate and are often in demand in the world of property development. Bridging loans can provide much-needed capital for a number of scenarios in property development, such as quickly purchasing a plot of land for development, funding the beginning of development following a land purchase, or completing the end-stages of a development when cash flow is drying up.
The demand for bridging loans has continued to increase in the UK market. Bridging loan transactions hit £766.9 million in 2018, an increase of £232.8 million on 2017, with property refurbishment as the main reason for bridging finance (28%).
Fluid investments will be lent internally from Fluid ISA Bond 2 Limited (The bond issuer) to the LendCo (Fluid Lending Limited), and the interest rate on that loan will be the same as that offered to the ISA bondholders.
All loans are asset-backed, either with real estate or company assets, and will be short term, typically lasting from 6 to 18 months, and will fund a diverse range of projects throughout the UK.
Fluid will use its broad knowledge and experience to acquire suitable clients in business and property, and will only facilitate loans once it has been assessed that they satisfy Fluid’s commitment to prudent lending.
Fluid will keep a varied and diverse portfolio of clients in order to spread the risk to investors. However, this does not guarantee a return on capital or of interest and Your Capital is at Risk. Fluid Bond is a (naturally) high-risk investment, and is aimed at sophisticated and high-net-worth investors. Investors may wish to diversify their portfolio to minimise concentration risk.
The fact that the bond is asset-backed does not guarantee that all capital will be repaid. This also means that there is a liquidity risk and there is likely to be a delay in repaying your capital should you request it. Please note that assets used as security may be insufficient to repay loans made by Fluid Lending Limited and do not guarantee a return for bondholders. Despite any previous experience, past performance is not a reliable indicator of future results.