LendInvest has sold a portfolio of residential buy-to-let mortgages to Chetwood Financial for £243 million.
The London FinTech, listed on London’s AIM market, is a technology-driven asset manager for UK property finance which aims to simplify the mortgage experience.
Following completion of the transaction, LendInvest will continue to manage and service the portfolio on behalf of the buyer. The mortgages originated from March to the end of November last year, a period which saw increases in the base interest rate with the knock-on effect of reducing the profitability of these mortgages.
The proceeds from the transaction will be used to repay the facilities that financed the assets, LendInvest said, which allows that capital to be redeployed to originate new mortgages with stronger margins.
It expects a pre-tax loss on the sale of the portfolio and the cancellation of the related derivatives of around £10.5m.
Last year LendInvest struck a new £180m lending partnership with Lloyds and substantially increased an existing deal with JP Morgan to £1 billion.
“This transaction demonstrates our proactive approach to capital management and supports our longer term strategy to manage an increasing proportion of platform assets for third parties,” said Rod Lockhart, CEO.
“It also initiates a new partnership, adding to a growing list of global financial institutions choosing to back our mortgage products. We believe the diversity, sophistication and continued commitment of our funding partners is a powerful demonstration of their trust in our capabilities.”