Houses into Homes Empty Property Loan Scheme Georgina Wayman Environmental Health Officer Private Sector Housing
Houses into Homes Loan Scheme In 2012, Welsh Government committed a 10 million recyclable loan fund to Wales. In 2013, the loan fund was increased to 20 million. Each Local Authority in Wales have been allocated a proportion of funding based on the % of private sector stock The purpose of the funding is to return long term vacant properties back into use. Welsh Government s target is to return 5000 empty homes back into use by the end of Government term (2015)
What is the Houses into Homes Loan Scheme? Interest free secured loans Available to empty property owners where a property has been empty for a minimum period of 6 months. A loan can be used to:- - Renovate or improve existing residential properties - Convert existing residential properties into a number of units - Convert commercial properties into residential accommodation On completion of the works the property/ units must be let or sold to a new owner.
Loan to Let renovate a property and rent it out (Interest free for a maximum period of 3 years; repayment period max. 3 years) Loan To Sell renovate a property with a view to selling it (Interest free for a maximum period of 2 years; repayment period max. 2 years) Not available for owner-occupiers
What is the maximum amount of loan that can be applied for? 25,000 per unit of accommodation Maximum of 150,000 per applicant Value of loan approved will depend on the actual cost of the works Maximum Loan to Value (LTV) including existing mortgages 80% LTV
Example: Current Property Value 100,000 Mortgage Value 65,000 Maximum Loan Available (80%LTV) 15,000 Total Cost of work 25,000 Applicant Contribution 10,000
Loan Application Process All owners will need to complete & submit an application form and supporting documentation. Proof of ownership Up to date land registry title & plan Proof of Identity All applicants need to provide two pieces of identification (1 Photo ID) & must meet with empty property officer in person. Proof of Income 3 months payslips/ 3 years certified accounts. All applicants are subject to a credit check.
Valuation Report - Must be undertaken by a member of the Royal Institute of Chartered Surveyors (RICS) to confirm the current value, potential value & rental income of the property offered as security for the loan. - The Vale of Glamorgan Council must be named as an interested party - The Surveyor must note that the Council are relying on the report for the purpose of the loan application - In some circumstances a valuation report may not be required, e.g. where a property is unencumbered.
Evidence of Planning/ building regulations All work must be carried out in accordance with any planning permissions or building regulation approvals A loan cannot be approved until these are in place and evidence has been provided. Estimates and cost of associated fees Two itemised quotes In some circumstances one quote may be accepted, e.g. where the owner is undertaking the renovations. The applicant is responsible for arranging the works.
Consent from First Lender (Mortgage Company) The loan is secured as a first or second financial charge against the property. If there is insufficient equity in the empty property, we can accept an alternative property as security. Must have written consent from mortgage company to secure a second charge and to enter into a deed of priority.
Loan Charges (Application Fees) Loan Amount Fee 0 50,000 295 50,001-100,000 395 100,001-150,000 495 Land Registry Fee For loans up to 100,000 50 For Loans over to 100,000 70 Company Application Register charge at Companies House 45
Loan Conditions Work must be carried out in accordance with planning/ building regulation approval. Work must comply with the Houses into Homes Standard - It should be free from category 1 hazards - It must be in a reasonable state of repair - It must have modern facilities and services - It must provide a reasonable degree of thermal comfort
Loan Conditions Cont d Applicant must provide certificates on completion Works must be completed within an agreed time period The property/ unit must be marketed for sale or let within 12 weeks of completion of the work. The loan must be repaid either on or before the date specified in the loan agreement. If an applicant breaches these conditions the loan may become repayable & interest will be charged at a rate of 6%.
Any Questions? Georgina Wayman Private Sector Housing Tel: 01446 709838 Email: gwayman@valeofglamorgan.gov.uk