On 24 February 2021, an illegal loan taken by the CEO Frazer Fearnhead,[10] and the inability of The House Crowd to strengthen its balance sheet, led to the company going into Administration.

Through crowdfunding, The House Crowd gave like minded investors the opportunity to pool their collective capital to fund a variety of investment loans.

The House Crowd was authorised and regulated by the Financial Conduct Authority through Prosper Capital, of which it was an appointed representative [12] As managing director Frazer Fearnhead explained to the BBC, ‘people's investment is protected by the bricks and mortar value of the property and if you want your money back you either need to wait for the property to be sold or sell your share to another investor.

We cannot guarantee you will be able to find a buyer but everyone who has wanted to sell so far has managed to do so within a few days.’[13] CEO Frazer Fearnhead appeared on episode 1 of series 13 of Dragon's Den, asking for a £1,000,000 investment for 5% equity in The House Crowd.

In an interview for Virgin Start Ups Fearnhead stated that the business subsequently used their crowdfunding platform to secure the investment they needed.

Companies House documentation has revealed concerns surrounding a c. £390,000 loan taken out by Frazer Fearnhead, “that breached [the firm’s] credit policy which constituted a reportable matter to the FCA and a conflict of interest”.

[19] This unauthorised loan by Frazer Fearnhead, and the inability of The House Crowd to strengthen its balance sheet, led the company's non-executive directors to conclude that the possibility of the FCA releasing the firm from voluntary requirement measures was likely to be jeopardised.

Due to, among other reasons, "an environment of poor record keeping and documentation" that have led to "significant challenges", the administrators have not been able to return any loaned sums to lenders.

Investors through Republic Europe (known as Seedrs at the time) who invested £751,191.00 in 2019[20] and also additional sums directly over the years also lost all their money with the company's sudden collapse.