FAQs

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Nester was first established in 2018 and is based in London. We operate as an online peer to peer (P2P) financing platform which will help you discover and invest in new property opportunities as an Investor or even help you finance your property depending on your individual needs. We believe in providing ethical and easy to understand information to all our customers

Who is Nester?

Our role is to carefully select and evaluate real estate investment opportunities for listing on our platform. Our team’s decades worth of experience in real estate financing and financial law means that we can use our industry expertise to help create and facilitate relationships between Investors and Buyers. For further details of our role over the life of the agreement, see Investor FAQ’s and our [Risk Statement](/risk).

We’re also here to answer any questions you may have when it comes to using our Service as we would like to make these processes transparent. You can email us at info@nester.com or call us on +44 203 983 0707.

What's Nester’s role exactly?

Nester takes every precaution when it comes to keeping your personal information safe. If you would like to know more, please see our [privacy policy](/privacy-policy).

How does Nester safeguard my information after I have registered?

Nester has been founded by individuals who have decades worth of experience in financial law, global banking and real estate financing. The information built up from these different sectors will help us provide you with exceptional products as well as being able to explain investing through our platform avoiding all the unnecessary jargon. We focus on creating financial empowerment for all and will always help break down barriers that may prevent you from progressing financially.

Our Service is also based on Islamic finance principles. This means we may use slightly different terms than you have seen on other P2P platforms. For example, we use the phrase “Buyer” where you may be used to seeing the word “borrower”. The investments we offer are called “Finance Requests”, rather than loans. More details about what Islamic finance means can be found under Our Principles below.

How is Nester different from other P2P Investors?

You can become a Buyer by first registering with Nester by clicking [here](/buyer). Once you’ve registered, we will need some additional information from you relating to your financial position in order to carry out our due diligence checks.

How do I make a Finance Request?

We take complaints very seriously and welcome all feedback. If you’d like to make a complaint, please email compliance@nester.com. We will then send you a copy of our complaints handling procedure, along with an explanatory leaflet regarding your ability to refer your complaint to the Financial Ombudsman Service if you are unhappy with our response. Our Complaints Officer will investigate your complaint and we will aim to get back to you as soon as possible. For more details on how we handle complaints, including the time frame we have to reply, please see our [Service Terms](/service-terms).

How do I make a complaint?

You can register by clicking [here](/signup). Once you’re through to the registration page, we just need you to fill in some initial contact information and then you can get started with tailoring your experience by either becoming a Buyer or an Investor.

How can I register?

About Nester

Anyone over 18 years old who is a UK resident can register. However, it must be noted that potential Investors will be subjected to an ‘Appropriateness Test’ to ensure that they have an appropriate understanding of the relationship between the Investor and the Nester Service, and their exposure to the risks of P2P. Nester may accept Investors from other countries depending on their passing of the relevant checks.

Who can become an Investor?

All our Finance Requests offer our Investors a first ranking legal charge over the UK property being financed, the key mitigating factor of the credit risk associated with the financing.

The security package will be clearly identified and explained for each Finance Request, supported by the associated documentation. The security package may also include, assignments over rental income, cash held as security and/or personal guarantees.

Even though all agreements are secured, your capital is at risk and the security does not guarantee you a return. Please see our [Risk Statement](/risk) for further details.

Is my investment secured?

An Investor may choose to invest in a Finance Request at any time and subject to the Investor having enough funds.  Once a Finance Request is selected for investment that amount chosen to invest is considered “allocated”. This ring fences the funds in the Investors e-wallet until the next profit payment date (see Murabaha steps below).

On the profit payment date, the allocated investment funds are then transferred and documentation executed. It is at this point the funds are considered “invested” and start to receive a return. While the funds are “allocated” and not “invested” the Investor does not earn a return and is able to cancel the proposed investment and withdraw their funds from their e-wallet.

What is the difference between “allocated” and “invested” funds?

The Buyer seeking finance to acquire, develop or refinance a UK property must be a UK resident and either a company, limited liability partnership and sometimes can be an individual.

If any of the following are identified in relation to the Buyer, senior management or ultimate beneficiary, this would preclude the application from proceeding:

- Convictions relating to fraud or dishonesty, including where a sentence is spent
- Serving a prison sentence, on a licence or awaiting trial
- Under 21 years of age at application
- Poor Credit History, such as outstanding county court judgements.

Where the security package includes a personal guarantee, we will always seek permission to obtain a credit report on the individual(s).

What are the eligibility criteria for a Buyer?

No.

All our fees are payable by the Buyer. The Buyer pays the Murabaha Profit monthly which is earned by the Investor as their return. In addition, the buyer pays Nester an Arrangement Fee to facilitate and manage the initial provision of financing, an Operating fee for the ongoing management of the transaction and in some cases an Exit fee where the repayment of the financing requires additional administration by Nester.

These fees are expanded on below:

- An Arrangement Fee which will be payable by the Buyer and will be charged upon execution of the financing. This will be a one-off fee charged as a percentage of the total financing.
- An Operating/Management Fee which will be payable by the Buyer. This will be as a monthly charge in line with servicing of the debt obligation. This will be an annual fee charged as a percentage of total financing paid monthly.
- Exit Fee which is to be paid by the Buyer upon repayment of the financing. This can be a fee between 0% to 2% (Based on risk).

Do we charge Investors a fee?

Investors can invest in three core types of property financing arrangement offered to Buyers:

- Buy to Let

Commercial properties that are let to an unrelated tenant generating rental income for the Buyer. Buy to Let properties can include retail outlets, offices, dentist, warehouses, etc. This type of project will benefit from the income generated from the rent to service the Murabaha Instalments. The Buyer would typically seek a longer-term financing to align with the long-term nature of the investment by the Buyer. The maximum term for this product is 3 years.

- Refurbishment/ Light Development Facilities

Nester offers to facilitate financing for development or light refurbishment projects for residential or commercial properties. The Murabaha Instalments will typically be prefunded by the Buyer with the term of the facility short to medium in nature, up to 2 years.

- Bridging Facilities

Bridging facilities allow a buyer to utilise a quick financing arrangement for a short period of time, typically 12 months. The maximum amount of cash would be held to service the Murabaha Instalments when offering a Bridging Facility.

The table below provides a summary of the criteria for providing finance to a Buyer and therefore an illustration of the type of investments you may invest in.

```
[
  {
    "1": "Commercial / BTL Financing",
    "2": "Refurbishment Finance",
    "3": "Bridge Finance",
    "category": "Title",
    "type": "head"
  },
  {
    "1": "",
    "2": "",
    "3": "",
    "category": "Financing Amount",
    "type": "category"
  },
  {
    "1": "£250,000",
    "2": "£250,000",
    "3": "£250,000",
    "category": "Minimum",
    "type": ""
  },
  {
    "1": "£2,500,000",
    "2": "£2,500,000",
    "3": "£2,500,000",
    "category": "Maximum",
    "type": ""
  },
  {
    "1": "",
    "2": "",
    "3": "",
    "category": " ",
    "type": "category"
  },
  {
    "1": "75%",
    "2": "65%",
    "3": "75%",
    "category": "Maximum Finance to Value",
    "type": ""
  },
  {
    "1": "-",
    "2": "85%",
    "3": "-",
    "category": "Maximum Finance to Cost",
    "type": ""
  },
  {
    "1": "",
    "2": "",
    "3": "",
    "category": " ",
    "type": "category"
  },
  {
    "1": "Min 1.5 times",
    "2": "-",
    "3": "-",
    "category": "Rent as multiple of Debt Service",
    "type": ""
  },
  {
    "1": "",
    "2": "",
    "3": "",
    "category": " ",
    "type": "category"
  },
  {
    "1": "TRUE",
    "2": "TRUE",
    "3": "TRUE",
    "category": "Independent Valuation",
    "type": ""
  },
  {
    "1": "-",
    "2": "TRUE",
    "3": "-",
    "category": "Independent Certification of Costs",
    "type": ""
  },
  {
    "1": "",
    "2": "",
    "3": "",
    "category": "Minimum Security",
    "type": "category"
  },
  {
    "1": "TRUE",
    "2": "TRUE",
    "3": "TRUE",
    "category": "First fixed legal charge",
    "type": ""
  },
  {
    "1": "TRUE",
    "2": "TRUE",
    "3": "TRUE",
    "category": "Debenture",
    "type": ""
  },
  {
    "1": "-",
    "2": "TRUE",
    "3": "TRUE",
    "category": "Guarantee (Corporate / UBO)",
    "type": ""
  },
  {
    "1": "TRUE",
    "2": "-",
    "3": "-",
    "category": "Assignment of Rental Income",
    "type": ""
  },
  {
    "1": "3 months of Murabaha Instalments",
    "2": "3 months of Murabaha Instalments",
    "3": "",
    "category": "Cash deposit",
    "type": ""
  }
]
```
Please review each individual Finance Request for assessment of the credit risk.

What products does Nester offer Investors?

Yes. As with all P2P investing, your capital is at risk. Please take the time to read through our [Risk Warnings](/risk) page carefully as it contains important information about investing through the Service.

Is investing risky?

You are presented with a high level summary of the risk score allocated to an investment deal as a point on a heat spectrum with a representative rating to assist the illustration. Our minimum financing criteria, as detailed below, acts as a base and therefore represents the highest level of risk the firm will consider with regard any opportunity. The risk will reduce as qualitative and quantitative factors, examples mentioned below, are incorporated within the assessment, our algorithm then produces an applicable rating or score. There are 9 positions across the spectrum, and they reflect the following ratings:

A1, A2, A3, B1, B2, B3, C1, C2, C3.

C3 financing falls within the base lending criteria while A1 financing has the highest level of risk mitigation.

The risk rating is determined using an algorithm that gives a weighted score to numerous variables such as the Finance to Value, the location of the property, the Buyer's credit score, and other factors.

Our credit committee, a panel of experts that approve each transaction, will consider whether the algorithmic risk rating determined by the scorecard reflects the risk for each deal presented.

If you are unsure about the risk of an investment or your ability to withstand the risk of investing, we encourage you to take independent advice from a qualified financial advisor.

How can I assess the risk of an investment?

Before allowing a Buyer to use the Service, we assess each Buyer’s creditworthiness and ability to afford to pay the Murabaha Instalments. We also carry out due diligence on the property that the Buyer will use as security, as explained in Clause 5 of the Nester Service Terms. We establish a risk rating for the Finance Request according to the estimated level of potential bad debt, which is communicated to Investors along with the methodology we use as explained above. We use this information to determine the rate offered to a Buyer.

How do we assess a Finance Request?

Your uninvested funds will be held by Goji Financial Services Ltd (Goji) as a payment services provider. Goji are industry leaders who specialise in creating investment platforms and asset management. If you would like to read more about them, [click here](https://www.goji.investments/) or see our [Service Terms](/service-terms).

Where are my uninvested funds held?

Any extension requested by an existing Buyer will be considered a new financing request. This means that we will undertake a full credit risk and pricing assessment before as the extension is approved. Existing Investors will have the opportunity to invest in the extension when it is approved and presented as a new Finance Request.

Will the term of the agreement ever be extended?

We will do everything in our power to ensure that in the unfortunate event we must close, we do so in an orderly manner. If we did take the decision to wind down, we would use the income we earn over the life of the P2P agreements supported by the Firm’ capital to fund an orderly wind down. We regularly review our wind down planning and our financial forecast to ensure that we will have enough funds to manage this process.

It is however important to also understand that your investment will not be covered by the Financial Services Compensation Scheme (“FSCS”). This is because peer to peer lending portfolios are not covered by the FSCS. Therefore, all capital invested in a P2P agreement or portfolio is at risk. Please see our [Risk Statement](/risk) for further information.

What happens if Nester goes out of business?

Nester has adopted a minimum investment amount of £1,000. There is no maximum investment amount.

Are there minimum and maximum investment amounts?

You may invest in as many projects or ‘Finance Requests’ as you require. Please do however take time to read our [Risk Statement](/risk) and remember that your capital is at risk. It is advisable to diversify your investment across a few projects to reduce your exposure to one Finance Request.

Please also remember that if you are an everyday investor or “Restricted” investor, you must not invest more than 10% of your net assets in P2P investments.

How many projects can I invest in at a time?

Once you have invested in a a Murabaha Contract, you should expect to hold that investment to maturity. As explained in our [Risk Statement](/risk), our investments are illiquid, and you should not invest funds which you may need access to before the maturity of the investment. You will not have a right to withdraw once the funds have been invested into the Murabaha Contract.

We do however offer a secondary market, which will allow you to ‘sell’ part or all your investment, however there is no guarantee that there will be a buyer.

What if I want to withdraw from an agreement?

We don’t deduct any tax from your returns; they are paid gross. The amount of tax you will pay will depend on your individual circumstances.

We will provide you with an annual statement showing any returns you have earned and if relevant, any losses you have incurred, to allow you to complete your tax return. Please do take professional tax advice if needed.

Do we withhold tax from your returns?

Investor faq

Once you have registered as a Buyer, you may proceed through the Buyer dashboard to upload the information required by the Nester team to review your Finance Request. The Nester team will be in contact to request further information and confirm whether financing can be approved in principle prior to full approval obtained from the Nester credit committee, a board of individuals selected to consider each transaction.

You should note that Nester also works with several Brokers that introduce new transactions and Buyers to Nester. They assist buyers collate and submit information on their behalf to Nester for review.

How do I apply for funding?

Yes, but as per our [Service Terms](/service-terms), you will need our written consent. Once received, you will need to complete the onboarding process, including passing the appropriateness test, before you can invest.

I initially registered as a Buyer; can I be an Investor now instead?

We request that all Buyers contact the Nester team if they are made aware of any situation that may result in an inability to satisfy their obligations. Subject to the terms of the financing agreement, the Nester team will work with the Buyer to facilitate their remedy of any breach.

What happens if I miss a payment?

Yes. Fees include the following:

- An Arrangement Fee which will be payable by the Buyer and will be charged upon execution of the financing. This will be a one-off fee charged as a percentage of the total financing (dependent on risk)
- An Operating/Management Fee which will be payable by the Buyer. This will be as a monthly charge in line with servicing of the debt obligation. This will be an annual fee charged as a percentage of total financing paid monthly (however risk based).
- Exit Fee which is to be paid by the Buyer upon repayment of the financing. This can be a fee between 0 to 2% (based on risk).

Do we charge a fee?

We have included the following matrix, extracted from the Firm’s Financing and Credit Policy, as a guide to assist buyers determine whether Nester’s products are suitable for their needs:

[Learn more](/buyer)

What products does Nester offer Buyers?

Buyers faq

Ethical and Islamic finance prohibits the use of financing to acquire properties which support businesses that are considered to have a negative social impact. This includes businesses that operate in the following areas: gambling, sale of alcohol, firearms, gaming and conventional banks and insurance companies.

In addition, interest-based loans are prohibited. The structure that is used to provide finance between a Buyer and Investor is based on a widely accepted contract which uses a deferred purchase and sale to create the debt obligation based on an agreed cost and mark up of a specified commodity. This contract is known as a Commodity Murabaha and discussed further below.

How does ethical and Islamic finance differ from conventional P2P Investments?

The Islamic Finance industry is one of the fastest growing financial industries worldwide with over $2 trillion invested worldwide, estimated to grow to $4 trillion by 2025. In addition to most high street banks and US banks that operate in this sector, the UK Government has now issued two Islamic Finance based sovereign bonds to reinforce London as an international and financially inclusive hub thereby also reinforcing that Islamic Finance is now a mainstream product.

Nester strives to ensure its products are ethical, transparent and fair for both Investors and Buyers.

Who else uses Islamic Finance?

There are a few core elements related to a Commodity Murabaha which are broken down below:

1. How does a Buyer pay for the cost of financing for any given period?

The Buyer agrees to purchase commodities (typically metals like aluminium or nickel) from the Investor at a price of cost + profit (i.e. £100 +£10). However, the Investor agrees not to receive payment for the commodities until an agreed time in the future. Obligation to pay has been created.

2. But where did the Investor get the commodities from?

Nester acts on behalf of all Investors and has an agreement with a broker with a trading platform allowing it to buy metals instantly at an agreed rate that is held as required. It acquired the metals at the ‘cost price’ (i.e. £100).

3. So, the Buyer now has commodities but no cash?

Nester acts on behalf of the Buyer and sells the Commodities through another broker on the same trading platform for the cost price (i.e. £100). As Nester has an agreement between both brokers it can net the purchase of the commodities in (1 and 2) above with the sale of commodities here in (3) on behalf of the Buyer and Investor.

4. How does the netting of the purchase and sale of commodities result in the Investor providing the Buyer with funds?

Nester, acting on behalf of the Investors, ‘buys’ the commodities through a broker (Broker A) – agreeing to pay Broker A the cost price (£100). Nester, acting on behalf of the Buyer, agrees to ‘sell’ the commodities through a broker (Broker B) for the cost price (£100). As Broker A and Broker B can net their positions, in effect the Investors transfer the funds to the Buyer to settle this arrangement.

5. Does this happen every month and do I need to do anything?

This takes place periodically and typically on a monthly basis. This process is automatic and the Nester platform will perform this role on behalf of the Buyer and Investor.

6. How do the Investors get their money back?

The Commodity Murabaha has an overarching long stop date or maturity date. This is technically the date of repayment of the facility. On this date, the Buyer will pay both the profit and the principal outstanding, replicating a typical financing repayment.

What is a Commodity Murabaha?

Yes, and you can access the certificates through the links below:

[Shaikh Nizam Yaquby](https://terms-of-agreements.s3-eu-west-1.amazonaws.com/Nester-Shariah-Certificate-Shaikh-Nizam-Yaquby.pdf)

[Amanah Advisors](https://terms-of-agreements.s3-eu-west-1.amazonaws.com/Nester-Shariah-Certificate-Amanah-Advisors.pdf)

[Mufti Muhammad Nurallah Shikder](https://terms-of-agreements.s3-eu-west-1.amazonaws.com/Nester-Shariah-Certificate-Mufti-Muhammad-Nurullah-Shikder.pdf)

FAQs

01:10 What is Nester?

01:21 Who Does Nester Serve?

02:33 Why did you create Nester?

04:25 What does Nester have to do with P2P?

05:21 Is Nester a Fintech?

06:29 What are all the products and services you have to offer?

07:13 Does Nester provide the finance to buyers?

07:29 What does FCA regulated mean?

09:14 How do you provide due diligence checks on those seeking?

09:52 How are the Buyers assessed? What sort of credit profiling is undertaken?

10:53 What is the project evaluation process?

13:54 How do I know that the buyers on the Nester platform are legitimate?

14:39 What are your fees?

16:17 Why should I invest with Nester and not any other online investment platform?

19:08 I want to invest, but I’ve never invested before, will someone advise me?

20:02 Are the investors guaranteed their return on time regardless of the buyer’s ability to pay on time?

22:04 What is the minimum and maximum investment?

22:30 Are asset valuations and LTVs conservative?

23:02 Do you have a provisional fund?

24:48 Can my profits be compounded?

25:24 What happens if things go wrong with a project - worst case scenario?

30:44 What happens if Nester goes out of business?

31:29 Do I have to pay tax or my profits? What are the tax implications of investing?

31:59 Why do you not offer ISA accounts?

32:38 As an investor, am I locked in for the duration of the investment term? Can I sell my investment partially?

33:33 When do I start getting repayments?

33:49 Where can I see all my investments?

34:01 How can I view my investment activity?

34:39 How do investors get their money? And when do they get their capital back?

35:13 Do you have an app?