In short:
- Delays are common in real estate crowdfunding, without necessarily meaning a loss.
- The contract usually provides for an extension, sometimes with late interest.
- In case of default, the platform enforces the guarantees set out in the contract.
- Spreading money across several projects limits the impact of one troubled deal.
Delay or default
A delay means the developer repays later than planned. A default means they cannot repay all or part of the money. Most delayed projects end up repaid, but not all.
What the contract usually provides
| Clause | Effect |
|---|---|
| Extension | The loan term is lengthened |
| Late interest | Interest keeps running, sometimes at a higher rate |
| Guarantees | Mortgage, surety or first-demand guarantee to enforce in case of default |
Good habits
Read the updates sent by the platform, check the guarantees attached to the project and avoid reinvesting with a developer in difficulty. The AMF website lets you check that the platform is licensed.