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Landbay steps away from peer-to-peer

Buy-to-let lender Landbay has exited the peer-to-peer market and will now solely use institutional funding.

The lender said it will continue to fund buy-to-let and focus on expanding its presence with the mortgage intermediary sector.

John Goodall, founder and chief executive of Landbay, said: “Landbay’s future is incredibly exciting as we see opportunities to grow with increased interest from our existing and new institutional investors. Today’s announcement means that as a business we can devote even more time to lending – supporting the UK’s vibrant and vital private rental sector.

“Having said that, this is not a decision we have taken lightly. The retail business has been instrumental in our journey as a company, and we are grateful to investors for putting their trust in us.

“This decision comes from a position of growth and success, and we will continue to invest in our people, technology, and brand to build a successful business of scale.

“Our aim remains to be the go-to funding partner in the UK buy-to-let market, for institutional investors, intermediaries, and landlords.”

It’s been a difficult year for peer-to-peer, with both Lendy and FundingSecure going into administration.

Landbay said this decision only impacts a small part of its business, as institutional funding now accounts for the overwhelming majority of mortgages originated in the last 12 months.

The lender said its peer-to-peer investors have had their funds returned in full to their Landbay account, including the interest accrued to date.

Since 2017, the firm’s annual lending has grown by over 500% in prime buy-to-let loans.