LendInvest is the first peer-to-peer platform which will allow homebuyers and remortgagos in search of mortgage funds to access the money direct from individuals who have money to lend, rather than mortgage lenders.

Peer-to-peer lending and borrowing has been growing in recent years, but before LendInvest, activity had been restricted to the lending and borrowing of businees and personal loans.

LendInvest aims to offer investors high returns while opening up the credit markets to borrowers. So far, deals worth £3.5m have been arranged via the platform.

Loans may be secured against either residential or commercial property.

Co-founder, Christian Faes said LendInvest would be able to make some of the most sophisticated fraud detection and underwriting processes in the market available to investors:

“Over the course of the last year we have quietly been working behind the scenes, building our online platform, and working with a select group of investors that have now already traded a number of loans on the system.”

On Monday, Your Mortgage sister title Mortgage Solutions held a head-to-head on the benefits of peer-to-peer lending in the mortgage market.

Rebuildingsociety communications manager Nick Moules said:

“Mortgages is a market that has the potential to be funded by peer-to-peer.

“Taking property as security in loans will certainly appeal to more risk-averse individual lenders, but returns will be lower than those who already lend to businesses in the peer-to-peer market.”

However, ASC Finance for Business managing director Henry Ejdelbaum questioned the ability of social lenders to assess risk in a way that adequately protected investors.