Glossary A–Z

The valuer’s opinion of what the property could reasonably sell for if it were marketed and sold within a restricted 90-day period, rather than being marketed for as long as necessary to achieve full Market Value.

Anti-Money laundering refers to the policies, law and regulations to implement in order to prevent financial crimes.

A loan is in arrears the day after an agreed payment has been missed. Whilst in arrears, for 1 calendar month, assuming the payment remains outstanding we may allow our borrower time to achieve their exit.

Whilst in arrears, Kuflink will continue to engage with the borrower to understand why the payment has been missed and work with them to find a way to either make the payment or agree an alternative way forward. Standard and Penalty Interest will continue to accrue and will be applied from the day following the loan expiry date, until the loan is repaid in full.

Buy to let refers to the purchase of a property specifically to let out, that is to rent it out. A Buy to let mortgage is a mortgage loan specifically designed for this purpose.

Wealth in the form of money or other assets owned by a person or organization or available for a purpose such as starting a company or investing

You are a Certified Sophisticated Investor if an authorised firm has confirmed you understand the risks of certain types of investments. This means you are considered able to assess those risks and accept the chance of losing your money.

Corporate Social Responsibility (CSR) is a motivation where businesses pursue societal goals. This may include charitable activities or behaving in an ethical manner.

Customer Due Diligence is the identification, verification and process to adequately assess and validate the accuracy of the information provided.

A loan is in default when it is 180 days calendar month past a missed payment (in line with the FCA) with this payment still outstanding.

Kuflink loan management team will begin to take action the moment a loan becomes overdue (1 day past).

EDI (Equality, Diversity and Inclusion) ensures fair treatment and opportunity for all. It aims to eradicate prejudice and discrimination on the basis of an individual or group of individual’s protected characteristics.

Financial Services and Markets Act

The UK Financial Services and Markets Act (2000) created the Financial Services Authority (FSA) as a regulator for insurance, investment and banking, and the Financial Ombudsman Service to resolve disputes as a free alternative to the courts. It also created the Financial Conduct Authority and the Prudential Regulation Authority to supervise banks, building societies, credit unions, insurers and major investment firms.

Kuflink’s Flexible IF-ISA is currently only available for Current Tax Year funds.

Our flexible IF-ISA system allows you to add and subtract funds within the same tax year without affecting your annual allowance.

The ISA subscription limit applies to the total of your investments and funds held in your Current Tax Year wallet. Please note, our ISA is not currently flexible for Previous Tax Year funds. For example, if you put £10,000 in your ISA during the current tax year and then withdraw £2,000, you can pay this £2,000 back into the ISA and still be able to put in another £10,000 before the end of the tax year, taking you up to the current £20,000 allowance.

The General Data Protection Regulation (GDPR) is a legal framework that sets guidelines for the collection and processing of personal information from individuals.

You are a High-Net-Worth Investor if you earn £100,000 or more each year or have net assets worth £250,000 or more (not including your home or pension). This means you can access high-risk investments, as you are considered able to understand and bear the potential losses.

His Majesty’s Revenue and Customs is the government department responsible for assessing and collecting taxes.

An innovative finance ISA allows you to lend money to a variety of borrowers who then repay your loan with interest on a tax-free basis within your allowance. In other words, it’s a way to get involved in peer-to-peer (P2P) lending.

A commission that a business pays to the person who facilitated the introduction.

Kuflink’s Loan Tiers are risk bands that are measured by Loan to Value. We may offer multiple Tiers on certain Select Invest loans to assist you in choosing what is right for you.

Kuflink splits a Borrower’s loan requirement into multiple parts creating Loan to Values for each

Example

Whole Loan 75% LTV

Please remember that the LTV for tiered loans may vary from the above example, so please ensure you check the LTV that applies to the tier and loan that you are looking to invest in.

Each Tiered Loan will have a different interest rate based on the LTV that applies to it. For example, by choosing Tier 4, as above, you are choosing a Higher LTV risk and you understand that you will be paid last, as listed above in the order of priority, to reflect the higher interest rate.

Each Loan Tier will have a different interest rate depending on the LTV bracket that applies to it, so, the higher the LTV risk you choose, the higher rate of return you could earn.

Loan Tiers could help you balance your risk exposure by allowing you to further diversify your Kuflink investment portfolio according to your personal risk appetite and investment plan.

Therefore, with Tiered Loans the lender chooses which loans they want to invest in and also the level of risk within that loan.

Order of priority when capital and/or interest is repaid

Whilst the whole loan is secured by way of a 1st or 2nd legal charge over the security property, the Tiers are ordered by priority. So, in the above example, Lenders who have lent funds in Tier 1 will be paid first on any capital repayment then Tier 2, then Tier 3, and then Tier 4. Similarly, once interest is collected, Tier 1 will be paid first then Tier 2, Tier 3, and Tier 4.

When Lending in Tiered Loans, you and all lenders in all of the Tiered Loans are accepting the order of priority when you invest.  If Kuflink recover and sell a property, capital is always recovered first.

The loan amount expressed as a percentage of the total cost of the development project. This typically considers the acquisition/purchase cost and development costs and is used to assess how much of the overall project cost is being funded by the lender compared with the borrower’s own contribution.

The loan amount expressed as a percentage of the property’s anticipated Gross Development Value (GDV). The GDV is the valuer’s opinion of the market value of the completed development, assuming the proposed works are completed in accordance with the agreed plans and specification.

The loan amount expressed as a percentage of the property’s 90-day value. The 90-day value is the valuer’s opinion of what the property could reasonably sell for if it were marketed and sold within a restricted 90-day period, rather than being marketed for as long as necessary to achieve full Market Value.

The loan amount expressed as a percentage of the property’s current Open Market Value. The OMV is the valuer’s opinion of the price the property could reasonably achieve on the open market following appropriate marketing, between a willing buyer and willing seller.

A Loan-To-Value (LTV) ratio is the relative difference between the loan amount and the current market value of a property, which helps lenders assess risk before approving a loan secured on the property.

A Money Laundering Reporting Officer is responsible for making certain that measures for combating financial crime within the business are effective

The valuer’s opinion of the price the property could reasonably achieve on the open market following appropriate marketing, between a willing buyer and willing seller.

Kuflink Peer to Peer is a platform managed by Kuflink Ltd, a FCA regulated firm, where investment opportunities are shown to eligible investors who can place different levels of investment in those opportunities based on the information made available to them.

Capital is at risk and Kuflink is not protected by the FSCS. Past returns should not be used as a guide to future performance.

Interest resulting from the late and overdue payment of a sum initially fixed by a commercial contract.

For each year (used in financial context)

The terms of the loan are being met, and no payments have been missed

The loan rating system is designed to indicate the risk level of each investment opportunity.

As a guide, an A1 loan is considered to be low risk and a C3 loan is considered to be higher risk.

The level of risk is determined using an algorithm that measures numerous variables that may include but not be limited to the LTV, the location of the security property, the borrower’s credit score, the term of the loan and the legal charge that we hold over the security.

You are a Restricted Investor if you do not invest more than 10% of your net assets in high-risk investments. This classification helps support responsible investing and manage your exposure to risk.

A secondary market is a market where existing securities or other assets are bought and sold

You are a Self-Certified Sophisticated Investor if you have experience or knowledge of things like investing in start-ups, helping small businesses raise money, or being part of a business angel group. This means you understand the risks and can make your own informed investment decisions.

Business loans secured on company assets or guarantees

A business loan for small and medium enterprises, often secured by a First Charge - Debenture or a Second Charge - Debenture - over company assets rather than property, meaning the security is over business assets and cash flow rather than land or buildings, and/or director guarantees to support growth or working capital.

The Automated Valuation Model (AVM) is an industry wide valuation model. It generates instant property valuations to support lending decisions.