The loan process

The loans are interest free and the money is available up front before work starts. They are available to pay for work on houses or commercial buildings including splitting a property into flats.

Individuals, charities, companies and businesses can apply. The most that can be borrowed is £25k for each property up to a maximum of £150k.

The owners of the property will need to provide three months pay slips (individuals) or three years accounts (charities companies and businesses) when they apply.

Any loan offered will be secured on the property and will take into account the existing mortgage. It can’t be more than 80 per cent of the property’s value - this must be supported by an independent valuation by the Royal Institute of Chartered Surveyors and local authority land search.

If the owner doesn’t carry out the work, there is a risk the local authority will repossess the property and sell it at auction.

Other points to consider are:

• Individuals, charities, companies and businesses will not be able to apply if they have an adverse credit history, bankruptcy or county court judgment against them.
  
• Where the cost of the work will be more than the value of the loan, the owner must be able to show that they have enough money to complete the development.
  
• there’s likely to be an application fee attached to the loan, expected to be in the region of £295.

Contact your local authority for more information.