A syndicate mortgage is where two or more investors join together to provide a business with a specific kind of mortgage. As an investor in a syndicate mortgage fund, you are recognized as a part owner of the mortgage based on the amount of money you’ve put forth. What’s more, each investor has the full face value of their principal registered in their name at the Land Registry Office.
Developers and builders use syndicated mortgages as part of their financing to take a project from conception to completion. Since banks are not too keen on funding a building project that hasn’t even started, developers will rely on syndicated mortgages to cover soft costs: consultant fees, zoning permits, architecture costs and even marketing and sales expenses. All this is to say that the mortgage you’ve provided is funding the initial stages of a project not the actual building of the project. Continue reading