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If you own an empty property, you can enquire about an Empty Homes Loan to bring the property back into use.

The Private Lease Agreement Converting Empties (PLACE) Empty Homes Loan Scheme helps long-term empty property owners bring their homes back into use.

The loans are to help with repairs, renovation or conversion to bring properties up to the Decent Homes Standard.

The maximum loan available is £50,000 (per unit of accommodation), up to £175,000 and is interest free. We register the loan as a charge on your property and you must repay it in line with the scheme conditions.

Once the work is complete, you can either sell or rent the property.

You can enquire about an Empty Homes Loan if:

  • you are the owner of a long-term empty property (registered as empty for at least six months)
  • you can supply security for the loan (this will mean agreeing to a legal charge on the property)

To enquire about an Empty Homes Loan, you will need:

  • to be eligible for the loan
  • your name and contact details

You can read our Empty Homes Strategy.

To be eligible for the loan, the work must:

  • result in the property or units being suitable for immediate occupation as a dwelling (when completed)
  • adhere to Building Regulations, and
  • achieve the Decent Homes Standard (as a minimum)

If you renovate the property to the Decent Homes Standard, we will create and agree on a schedule of works before offering a loan. This will form part of the loan conditions.

If work is eligible for assistance under an insurance claim, then that work is not eligible for the loan.

Any work outside of the area surrounding the property is not eligible for the loan, except if:

  • they provide essential services such as water, gas or electricity, or
  • the work is essential to meet the scheme requirements in the schedule of works

Buildings that are not eligible for loan

You will not be eligible for a loan if your property:

  • is not permanent (for example, houseboat or caravan)
  • is not suitable for conversion to habitable dwellings
  • is a shed, outhouse or extension (for example, conservatory which does not have Building Regulation approval)
  • is being converted into multiple units for residential use and either the owner or a family member will live in one of the units (the cost of the work associated with that family unit will not be eligible for the loan)

Legal charge

To secure the loan, you must agree to a legal charge on the property. This is part of the loan application.

We will usually not consider accepting a charge on an alternative property. We will only take this type of proposal to the PLACE Consortium for consideration in exceptional circumstances. The Consortium will make their decision on an individual basis.

If a legal charge is on an alternative property, the alternative property must be in the same local authority district.

All legal charges must either be first or second charges.

All loans under the scheme are repayable. You can borrow up to £50,000 per unit of accommodation, up to a maximum of £175,000. This depends on the funds being available.

The amount of loan available depends on the total cost of the eligible works. We will assess these costs to ensure that they are reasonable and present value for money.

Types of loan

The type of loan depends on the property and the proposed work. For example:

  • a two bedroom family house is eligible for a loan of up £50,000 (classed as one unit)
  • a house converted into two self-contained flats is eligible for up to £50,000
  • a large house converted into eight self-contained flats is eligible for the maximum amount of loan of up to £175,000

The amount is the total of all eligible costs (for example, the cost of the eligible works plus any eligible fees including VAT).

Loan to sell

A loan to sell is repayable either:

  • immediately upon sale of the property, or
  • within two years of the dated Loan Facility Agreement (whichever is the sooner)

Loan to let

A loan to let is repayable:

  • within five years of the dated Loan Facility Agreement, or
  • upon the future sale of the property (whichever is the sooner)

If the loan is to convert a property into multiple units and there is a disposal of one or more units, then you must repay the lesser amount of either:

  • the gross sale proceeds, or
  • the amount of loan outstanding

If after this there is still money outstanding on the loan, then you must repay this on whichever occurs the earlier of either:

  • the disposal of the final unit, or
  • the relevant date set out in Loan Facility Agreement

The loans are interest free, providing there is no default on the loan agreement.

Once we receive your loan enquiry, we will determine whether you qualify for a loan.

We will verify that:

  • the property has been empty and unoccupied for at least the last six months
  • the property is in possession, is in the ownership of the applicant and registered with the Land Registry
  • the property requires work to bring it up to the Decent Homes Standard (we will assess this by arranging a full property inspection)
  • you have the required consent for the works (for example, party wall consent, full planning permission, building regulation approval, listed building and conservation area consent)
  • you intend to either sell the property or rent it out on completion of the works
  • there is enough equity in the property and the risk rating is acceptable
  • there are no legal constraints or restrictive agreements on the property that would prevent the proposed works
  • the company is registered in the UK (if the application is from a company)

If you live abroad, we will verify:

  • that the property that is being used to secure the loan must be in the UK, and
  • you have a solicitor acting for you that operates from the UK

Our Empty Homes Officer will arrange with you to carry out a full inspection of the property.

We will assess the property using the Housing Health and Safety Rating System. We will draw up a schedule of the works (applying the Decent Homes Standard) that are eligible for the loan.

Your application

If you agree with the schedule, we will send you an application pack to apply for the Empty Homes Loan. The pack will include:

  • an application form
  • the schedule of works
  • draft copies of the Loan Facility Agreement and legal charge

You will send your completed loan application to us. This will consist of:

  • your completed application form
  • evidence of your identity
  • confirmation of ownership of the empty property (Land Registry)
  • a valuation report provided by a qualified RICS surveyor of the empty property
  • evidence of any outstanding mortgage or loan on the property
  • permission from mortgagee or existing charge holder for a second charge to be registered against the property
  • three itemised quotes from suitably qualified contractors and any associated fees (for example, structural engineers fees)
  • specialist reports, building regulations, planning permission and plans (where required)

We will approve a loan based on the lowest priced quotation, where reasonable. You can choose to go with a higher priced quotation but must fund the difference in costs. You will need to provide evidence you can meet this cost.

You can find full details of the evidence and information required to apply for the loan in the application form that we will send to you.

We will assess each loan application on an individual basis. All applications for a loan are subject to a risk assessment that forms part of the decision to approve a loan. We will give preference to applications scored as low risk.

As part of the application process, you will have to provide an office copy of the Title Plan from HM Land Registry. This will confirm ownership of the empty property and any other property included in the application. The cost for this is £14 per property.

If you already have a current copy of this document you don't need to buy a new one. You will need to provide us with a copy of this document.

You will also have to pay for the following costs up front:

  • a valuation report of the empty property and any other property included in the application
  • registering the property with Land Registry (if the property is not currently registered)
  • registering the legal charge (£40) and, if you are a company, a registration fee to Companies House (£10)
  • solicitor, surveyor or other professional adviser fees in connection with the loan procedure

You may also need to get a mortgage report for which there may be a charge (if you have a mortgage on the property).

The loans are free from interest, providing there is no default on the loan payments. In the case of default, we will charge you 6% interest on the loan money from the date we released it to you.

If your application is successful, you can request us to include some of these costs in the loan amount.

We will notify you of the outcome of your loan application in writing.

If we refuse the application, we will advise you of your right to appeal the decision.

Loan approval

Once we have approved the loan, we will provide you with:

  • a letter confirming the loan offer (this will specify the amount of loan, the repayment period, agreed instalments if it is a multiple loan, and the loan conditions)
  • two copies of the Loan Facility Agreement

To accept the loan offer, you must send us one copy of this agreement, signed and dated by all borrowers. The offer will remain open for 12 weeks.

If you wish to proceed and have returned the Loan Facility Agreement, we will draw up the legal charge.

Once prepared, we will send this to you to sign and return to us.

Once you have returned the legal charge document, we will carry out the required checks. If everything is in order, we will pay the loan to you and register the loan amount as a charge with the Land Registry.

Once we have approved the loan, you can arrange for the works to begin.

The contract for the works is between you and your chosen contractor. It will not include us or any of the PLACE partner authorities.

We will inspect the works to make sure they follow the specification of work, the Decent Homes Standard and good building practice.

However, they will not be liable for any poor workmanship, or provide any guarantee.

Once the work is complete, you will notify us and an officer will inspect to ensure that:

  • the completed work is a satisfactory standard and follows the loan offer and quotations, current Building Regulations and the specification of works
  • copies of certified guarantees and test certificates requested as part of the agreed schedule
  • the repair and renovation of the property complies with the Decent Homes Standard

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