1 Home Plus Plan This is because the alterations may affect the property value in either What about my mortgage? direction. Assuming the alteration does add value, the Council will Your mortgage (if you have one) will remain as the ‘first charge’ on the benefit from this unless consent is sought before the work is carried deeds and at the Land Registry. The gap funding will be placed as a out. The Council will not give consent if the alteration is likely to ‘second charge’ or ‘ third charge’ if you already have two. This ordering reduce the value. This does not apply to decorating or carrying out of charges is the order in which the shares will be repaid on sale. minor changes. The Home Plus Plan has been specially created for What about the costs of buying? What will the Council do with the money when it is repaid? The reasonable costs of buying and selling should be met by your home owners and tenants affected by the Housing The Council will be running a Home Plus Plan fund and will re lend the disturbance payment. This will include the cost of a Homebuyer’s Market Renewal demolition proposals. It can help money to another household who needs assistance in buying or repairing survey. a home. The Council will not make any profit from this scheme. you to bridge the gap to buy a new home. For more information, see leaflet 4 on ‘Compensation and Disturbance’ Other conditions and leaflet 5 on ‘Buying and Selling a Property’. . Where can I get independent advice about this scheme? What property can I purchase? Independent Financial Advice is one of the steps we recommend you The property you buy has to be mortgageable and we will require a . take in obtaining this share. We want you to be certain that it is the Homebuyer’s survey to be carried out to assess this. most suitable product for you in your circumstances. The reasonable You may be eligible to use Oldham Council’s Home Plus Plan to meet It has to be within Oldham or Rochdale and be for sale with vacant cost of this independent financial advice will be paid for by the Council. the gap in value between your current home and your new home. . possession. We can provide you with a list of Independent Financial Advisers who It differs from a repayment mortgage or shared ownership in that you . are familiar with our Home Plus Plan. If you wish to discuss any of do not need to make a regular payment of interest or rent. Instead we It has to be residential and have no commercial use. . these issues further please speak to a Community Housing Officer. ask for repayment from your equity when you next sell your home or It has to be in a reasonable state of repair. transfer the deeds. . It has to be valued below £200,000 New homes must qualify for a National House Building Council certificate Discounted Homes You may also find it useful to read the leaflet on Discounted Homes How does it work? Market value for your home that explains another way of buying a home at less than market value. Can I ever buy back the Council’s equity by paying the gap With this scheme, the discount is tied to the property so your choice of If you need to borrow £15,000 to buy a property valued at £60,000, We recommend funding off early? where you can live is restricted. gap funding of £15,000 will amount to 25% of the value of your new that you discuss You will be able to make full or part payments of the gap funding. It home. this scheme with will be necessary to obtain an independent valuation to determine the an Independent For more information, see leaflet 2 ‘Discounted Housing’ Financial Adviser. value of the property at this time. There are costs involved in paying This will be noted as a legal charge on the deeds to your home in the back the funding which include the valuation fee, legal fees and same way a mortgage is noted. Check that this mortgage will meet your needs if you Compensation administration charges. We will cover these costs for two payments of £5,000 or more in a five year period. want to sell your home or if your family want to inherit it. When you come to sell your home, or transfer the deeds, you will need If in doubt, seek independent advice. to repay Oldham Council 25% of the new value. Any repayment will be converted into a percentage share and will be registered as such. If you were selling the property in the example above for £80,000, you Community Housing Officers - will have to repay 25% of this to Oldham Council, which is £20,000. Can the Council take the home I move into from me? No, providing you comply with the conditions of the loan. As there are Derker Team (0161) 652 8873 What you repay depends on property values and how they rise or fall Gap funding no monthly repayments there can be no defaults. However, if used in over time. If values fall you would pay back less than you borrowed. Flint Street, Derker, OLI 4EX of UP TO conjunction with a traditional mortgage, your home would be at risk if £35,000 payments are not maintained. Community Housing Officers - Example Are there any other conditions attached to the Home Plus Plan? Werneth/Freehold Team (0161) 911 4246 Mr and Mrs Smith currently own a home valued at: They take up gap funding of: £60,000 £20,000 The Council is offering the Home Plus Plan to benefit owner occupiers 80 Tamworth Street, Werneth, OL9 7QY to buy a house valued at: £80,000 and residents of areas proposed for demolition. It is a requirement of The gap funding is a quarter (25%) of the value of their new home. Community Links Support Officers - the gap funding that you remain an owner occupier. If you decide at any point to move out and rent your property, the gap funding becomes (0161) 331 2611/2632 If in 15 years this house is valued at: £100,000 Free independent repayable at that time even if you are not transferring the deeds. they will have to pay back a quarter of the value which will be: £25,000 financial advice Their share of the equity will also have grown and will now be: £75,000 Equally the Council wishes to protect its investment and will require This represents an APR of 1.5% you to maintain building insurance on the property. We will ask for evidence that our interest in the property has been noted by your www.oldhamrochdalehmr.co.uk It is likely that Mr and Mrs Smith would have been in a similar position insurance company. This is normal practice with mortgages. financially if they had not needed to move. We will also require that you maintain the property and we will include Is it Shared Ownership? legal clauses to allow us to force the sale if the property falls into a No, it is not shared ownership. You will be the only registered owner Moving and poor state of repair. survey on the deeds. The Council will register a legal charge like a building costs paid society or bank does with a repayment mortgage. October 2006 Eligibility and Process See leaflet 5 ‘Buying and Selling a Property’ for more information on the next steps. Example Mr Brown has agreed a valuation of £60,000 for his current home. Who can use the Home Plus Plan? What income will you take into account when you assess He already has a mortgage for £15,000 and his mortgage lender says Firstly, you must be affected by the Council’s Housing Market whether I can have gap funding? he could borrow a further £15,000 on the basis of Renewal proposals for demolition to be able to apply for a We will take into account the income of the main householder and his income. This means he could go and look for houses valued Home Plus Plan. partner if applicable. If you want to up to £75,000. A family of six from Oldham have moved to their ‘dream home’ thanks to the work through . Home Plus Plan. Secondly, you must have been occupying your home as an owner If you already receive any means tested benefit you will be eligible for another example If he saw a house for £100,000 he could borrow a further £25,000 occupier or a tenant either; with a Community Sonia Kershaw Whittle, husband Norman There the share without any further questions about your income. Housing Officer, as gap funding through the Home Plus Plan. a warehouse supervisor and their chil- on the date the Council formally agreed to offer this scheme in your are trained give us a call . dren Ryan, 10, Lewis, four, Tyler, four area and still be occupying it staff on the What about savings? This £25,000 is 25% of the value of his new home. When he sells the and 18-month-old Corey, have moved telephone numbers from a terrace house which is ear- or Savings will not be taken into account at all for applicants over 60 years house in the future he will need to repay 25% of the resale value. on the back page marked for demolition to a three bed- for 12 months before the date you apply. who can guide old. For people under 60 years old, it is expected that savings are put room modern detached house on Redcar Close in Stoneleigh Park. In addition to that you must continuously occupy your home between the relevant date and the date you apply for gap funding. you through your options towards a new home before the gap funding is made. However, we recognise that people keep money on one side for emergencies and Paying it back The family have received market value some savings will therefore not be counted. for their home, a home loss payment, Thirdly, there is an application process and it will be necessary to When do I pay it back? survey and moving costs and gap fund- provide details about your income as you would if you were applying ing. They will only pay back the percent- For more information about what level of savings will be taken into You have to pay back the gap funding when you sell your house or age of equity borrowed when they sell for a mortgage. account, please speak to a Community Housing Officer. transfer your deeds. the new home in the future. We recommend that you discuss I am a tenant, are there any particular requirements for me? The only exception to this is the transfer of deeds between partners Sonia said: “When I first heard about the this scheme with People who already own their own home will have equity or a on separation or bereavement. You will not need to pay back the gap demolition plans I was one of the people saying I’d chain myself to the radiator mortgage to bring to the new home. The Home Plus Plan will only be How much can I get? an Independent Financial Adviser funding in these circumstances, but it will be repayable on future sale rather than move out, but now with hind- offered up to a maximum of half of the value of the new property. This sight I think this is the best move ever to or deed transfer. our dream home. means tenants must be able to provide cash or raise a mortgage for at How much can I get through the Home Plus Plan? least the other half of the value of the new home. You can access up to £35,000. In certain circumstances close family members who have been living with “We have managed to buy a beautiful house with front and back gardens for the home owner for at least 12 months prior to the event which causes the boys to play in, it’s closer to their See the section on the next page on ‘How much can I get?’ Can I get a gap funding to top up a mortgage? the transfer to happen will not need to pay back the gap funding at the school and it means I can stay close to my An Independent Financial Advisor can advise you if you are able to take out time the deeds transfer. The person taking over the deeds must be the mum and dad, which was a priority. I think all of the new housing being What is the process for taking out the Home Plus Plan? a mortgage and which mortgages best suit your personal circumstances. occupier and not a third party. If this is of concern to you please discuss planned for Derker will eventually raise If you want to buy a home of greater value than this mortgage will allow, with a Community Housing Officer. the prices of homes nearby. I don’t think you can also use the Home Plus Plan. 1 we can lose out.” In very exceptional circumstances where a housing need arises and the Make an application with a Community Housing Officer who only way of meeting this need is to move, the owner can apply to take will assess your eligibility the same amount of loan out for a new home that meets their need. All gap funding will have to be repaid when the property is sold, even if a transfer of ownership between partners (because of 2 An Independent Financial Adviser will visit you to assess whether this is the most suitable product for you. separation or bereavement) has occurred at an earlier date. What if I never sell my house? Whoever inherits your house will have to repay the gap funding from your estate. 3 Complete a full application with West Pennine Housing Association, How much will I pay back? who are acting on the Council’s behalf to arrange this. You will pay back the same percentage of the value as you borrow This will involve looking at savings, income and outgoings. when you take out the gap funding. What if values increase or decrease? 4 Offer of gap funding will be made if you meet the criteria. You will still pay back the same percentage of the equity as you borrow. The Council recognises that this means it is possible your repayment will be less than the amount you borrow and will take this risk. Equally the Council wants you to clearly understand that if values increase the Council will recover the full percentage of the equity. 5 You can then start to look for a new home What if I want to add to the value of my home by carrying out home improvements – will the Council benefit from my work? If gap funding has been used, a home owner must ask for the Council’s permission before carrying out any alterations or improvements. The Council will ask for work proposals and plans before giving consent.