Home Improvement (Equity) Loans FAQ
- Can anyone apply for one of these loans?
- How much will I have to pay back?
- So when do I pay it back?
- What will happen if the value of my property rises before I sell it?
Can anyone apply for one of these loans?
No. These loans are only available to people who are eligible for state benefits or are on a low income and who coluld not otherwise afford to finance home improvement works through usual methods such as obtaining a loan through a bank or building society.) You must live in the City of Liverpool, be over 18, and an owner occupier with sufficient free equity in your property.
How much will I have to pay back?
Suppose your property has a market value of £40,000. If you borrow £5,000 to make improvements to your home (which includes VAT and fees), if the market value of your home following completion of the work rises to £45,000, the loan will represent 11.11% of the new market value of £45,000. This 11.11% will be registered as a charge against the property on the deeds.
So when do I pay it back?
You need pay nothing until your property is sold or otherwise changes ownership. Otherwise, you could decide to pay at any time when it suits you.
What will happen if the value of my property rises before I sell it?
If - for example - after 10 years the property changes ownership and is sold for £55,000, the repayment will be 11.11% of this or any other value which it reaches. In this case, 11.11% of £55,000 will be £6,111.11 to repay.