Below you will find a breakdown of the fees we charge to our customer groups.
Arrangement fee - up to 2.5% including an underwriting fee if applicable (plus VAT where applicable)
Introducer/Partner fee – as agreed directly with the Introducer/Partner.
Legal fees - based upon the complexity of the transaction.
The agreed annual rate may include an ongoing platform fee (max 2% where applicable) and underwriter’s fee (max 0.5% where applicable). These fees vary according to the risk profile and will be agreed with the borrower on a case by case basis.
Default and recovery fees
Default Administration Charge Fee
3% pa based upon the principal of the loan outstanding at the date of default.
The Default Administration Charge is charged from the date the Borrower goes into default or a default event occurs and continues until such time as the default is remedied or the Borrower enters a formal insolvency process.
Recovery Administration Charge
Recovery Administration Charge of up to 15% of the principal amount of the loan outstanding will be charged to the Borrower, in the event of the Borrower entering into a formal insolvency process.
Existing investors registered prior to January 1st 2018 – No charge
New investors registered from January 1st 2018 – Lender Fee equivalent to 1% reduction in the annualised rate of interest received based on an illustrative loan earning 10% interest pa gross of the Lender Fee, resulting in interest paid of 9% net of the fee (please note that your capital is at risk and other fees may be applicable and so the actual return on your lending may be lower than the interest applicable to the loan).
The Lender Fee is inclusive of VAT.
The Lender Fee will vary with the interest rate applicable to a loan part, so loans with lower interest rates will attract lower Lender Fees and vice versa (see notes below). The fee is only payable when interest is actually paid to an investor.
The Lender Fee is calculated as 10% of interest paid to new investors. For an illustrative loan earning 10% interest gross, the Lender Fee represents a 1% reduction in the interest received by new investors. If the interest earnt on a loan part is higher or lower than the illustrative rate of 10%, the Lender Fee will vary accordingly. So, if a loan earns 8% gross interest, the Lender Fee will represent a 0.8% reduction in the interest payment. If a loan earns 12% gross interest, the Lender Fee will represent a 1.2% reduction in the interest payment.
The Lender Fee is collected by applying a fee at the same time as an interest payment is paid to an investor. The fee is shown separately to the interest payment. For example, a gross interest payment of 8% pa would also have a Lender Fee equivalent to a 0.8% reduction applied separately, resulting in net interest received of 7.2%.
The Lender Fee will not be applied to investors registered with an account before January 1st 2018. It is not necessary to have funded the account, nor to have purchased loan parts before January 1st 2018 to be exempt from the fee.
Where a new investor purchases a loan on the secondary market, the Lender Fee will be applied to any interest received by the new investor after the purchase. This includes interest due, but not yet paid at the point of purchase. Note that with a gross roll up loan the entire interest due may only be payable at maturity of the loan, and so the Lender Fee will be calculated on the whole interest received at maturity.
If an existing investor purchases a loan on the secondary market, the Lender Fee will not be applied to any interest received by the existing investor after the purchase. This includes interest due, but not yet paid at the point of purchase. This includes roll up loans, where the entire interest due may only be payable at maturity of the loan.
If an existing investor opens another account after January 1st 2018, the new account will not attract a lender fee provided that the investor notifies the account opening team that an existing account is already held. This may be the case, for example, where an existing investor decides to hold both a general and a pension account with us.
Diversified Loan Portfolio (DLP)
ThinCats will charge an administration fee of 1.0% per annum on the balance of the outstanding DLP. This fee will be deducted monthly from the lender’s cash receipts on the DLP and is in addition to the standard lender fee that applies to lenders that registered after 1 January 2018.
There are no additional fees for operating a ThInCats ISA, however, standard lender and Diversified Loan Portfolio fees still apply.
Secondary Market Fee
1% of the capital outstanding of the loan part sold, rounded to the nearest whole £.
Scaling fee dependent on the recovery:
Recovery fees of up to 15% will be charged to the Borrower, in the event of the Borrower entering into a formal insolvency process. Where there are insufficient realisations from the borrower or guarantors, to repay the outstanding loan amount together with accrued interest and charges in full, a scale charge will be applied to lenders based on the recovery made, as set out in the Platform use and Lending Terms and Conditions:
- Recovery of up to 50% of the outstanding amount – 5%
- Recovery of 50.01% – 75% of the outstanding amount – 7.5%
- Recovery of 75.01% – 99.9% of the outstanding amount – 10%