Publication, Alternaive Credit Investor, has reported on Somo's recent success at court against borrowers who attempted to evade repayment, reinforcing our commitment to protecting investor capital through robust documentation and diligent underwriting. Read the full story below:
"Somo’s investors have praised the award-winning property lender following a decisive court victory against two “unscrupulous” borrowers. The case, which spanned over three years, reaffirmed Somo’s commitment to protecting investor capital through diligent underwriting, robust documentation, and strong legal strategies.
Background of the Case
In August 2020, a married couple—Mr. and Mrs. R—took out a loan with Somo for £421,600, secured against their main residence. The agreed repayment plan required the sale of the security property and other land assets before the loan term ended. However, the borrowers failed to meet these terms, forcing Somo to commence default proceedings.
In November 2021, Somo appointed an LPA receiver for the property and placed the borrower company into administration. Legal proceedings began in January 2022, revealing further complications, including Mrs. R’s claims of undue influence from her husband. If successful, this claim could have resulted in Somo losing access to half of the security.
Legal Challenges and Court Proceedings
As the case progressed, evidence of fraudulent activity emerged, prompting bankruptcy proceedings against Mr. R. Despite multiple settlement opportunities extended by Somo, the couple refused to engage, leading to a full trial in February 2024.
The court ultimately ruled in Somo’s favor, affirming the legal validity of the loan and dismissing Mrs. R’s undue influence claims.
“At Somo, trust and transparency are at the core of everything we do,” said Louis Alexander, Founder and CEO of Somo. “We always ensure that all named borrowers receive independent legal advice before entering agreements, and this diligence was a key factor in the court’s ruling.”
The judge found that Mrs. R was not a credible witness and that her claims were inconsistent and misleading. The court ruled that Somo’s loan documentation and legal processes were fully compliant with regulatory standards and dismissed the defendants' counterclaims and right to appeal.
Investor Support and Market Confidence
Following the ruling, the judge ordered the defendants to surrender possession of the security property within 90 days. Investors responded positively to the outcome, reaffirming their confidence in Somo's approach.
“Keep up the good work!” one investor remarked. “My family and I hope to be investors with you for many years to come.” Another stated, “Well done. I will now look at increasing our investment over the next few days. You have given me confidence.”
Somo's Continued Commitment to Investors
Somo’s meticulous loan origination and underwriting processes have ensured that all loans are secured against UK property, with the platform reporting zero capital losses to date. Since its launch, Somo has funded over £330 million across more than 1,500 loans.
“In a highly legal environment with regulatory considerations, it is crucial to ensure all aspects of lending are meticulously handled from the outset,” added Alexander. “While anyone can lend money, the true challenge lies in securing its repayment.”
Somo continues to set industry benchmarks, earning a 5-star rating on Feefo and maintaining its prestigious 4thWay +++ (excellent) rating for the second consecutive year. As Somo moves forward, it remains steadfast in its mission to provide secure, high-quality investment opportunities for its investors."
Read the full ACI Article here: Somo investors praise company after court victory
Categories: Investor News
