Process

Finsens’ role

Finsens takes care of the entire financing process, from start to finish:

Analysing role:

Finsens analyses the financing application (borrower, security, due diligence). If necessary, we then contact professionals to conduct an independent quality due diligence investigation.

Coordinating role:

Finsens coordinates the entire process of coming to a final agreement, bringing in professional third parties (notaries, lawyers, appraisers, etc.) if needed.

Mediating role:

Finsens brings the borrower and lender into contact. After a positive analysis has been completed, Finsens draws up an information memorandum detailing the starting points, the structure and the securities involved in the proposition.

Managing role:

Finsens is the manager of the Foundation and will take care of monitoring the investment. This includes handling the monthly / yearly interest payments, managing the construction deposit loan, requesting and checking the rental agreements, etc. You are kept up to date on all of the developments via our quarterly report.

Legal structure

For investors, we establish a foundation with the purpose of issuing a mortgage bond on the one hand, and providing a loan on the other hand. This foundation always has right of 1st mortgage to the security in question. The bond loan (including general terms and conditions) and the mortgage loan are both drawn up by a notary. A new foundation is established for each new proposition. You will always know exactly which of the foundation’s loans are outstanding.

The foundation is managed by Finsens Participaties B.V.

 

This structure allows us to combine the assets of several different investors, while providing each of them with the right to the securities.

schema-process-uk
RIGHT OF MORTGAGE

For each mortgage loan, the foundation gets the right of 1st mortgage. This is the right to use a property linked to the mortgage as security. This allows the Foundation to reclaim the property if need be, and sell it if the borrower does not fulfil their obligations. The proceeds of the sale are then used to redeem (part of) the loan.

Proposition

You provide the funds for a mortgage bond, which are then loaned out, with property as security. The value of the property always exceeds the amount of funds you provided. You receive between 4-6% interest per year. The mortgage bond is redeemed within 3 to 5 years.

FINSENS’ REMUNERATION

The borrower pays interest every year. Finsens takes between 0.5 and 1% of the paid interest to satisfy start up costs and as a managing fee. You then receive the remaining interest, which ranges from 4 to 6% per year. The borrower may also be asked for an additional one-off fee; this depends on the complexity of the application.