Welsh Government owner-occupier loans
A Welsh Government funded scheme that offers interest free loans to help homeowners carry out repairs to their homes to make them safe, warm and secure.
Both individuals and companies can apply for a loan however priority will be given to owner occupiers.
The maximum loan amount will be £25,000 per property and providing there is no default on the loan, they will be interest free. Loans can be paid off over a monthly instalment period through to March 2029.
Loans will be subject to an affordability test to confirm the applicant has sufficient income to repay the loan. For owner-occupiers on low income who cannot afford a repayment loan, they can be assessed for eligibility for owner-occupier repayable financial loan assistance that will be repayable on future sale or transfer of the property. Works within this loan are restricted to urgent repairs only.
Although the loan is interest-free an administration fee is charged to cover the cost of processing applications. This includes the cost of a surveyor assessing your property to establish what works are required, preparing a schedule of costed works, appointing a contractor and supervision and payment of the works.
The Welsh Government 'owner occupier loan' and 'owner occupier repayable financial assistance loan' scheme offers interest free loans to help improve housing conditions in the private sector. Loans are available to owner-occupiers to enable the renovation and improvement of single properties or the conversion of empty properties so that they are suitable for use as residential accommodation by the homeowner.
Check that this loan will meet your needs if you want your family or others to inherit your home, as a legal charge will be placed on the title of your property. If you are in doubt, seek independent legal and financial advice.
Who is eligible
- Owner-occupiers of sub-standard properties, and properties empty for a minimum of 6 months. The owner-occupier will need to live at the property as an owner-occupier for the duration of the loan period.
- Persons applying for loans may either be existing or prospective owners. The property must be registered in the applicants name before the loan can be approved.
- All loans are secured by placing a financial charge on the property.
- Properties must be at least 10 years old.
- Loan to value ratio cannot exceed 80%.
- Owner occupier loan applicants will be subject to an affordability test and will need sufficient income to afford the loan repayments; and will need sufficient income to afford the loan repayments. The value of the loan that can be provided will be dependent on the amount of disposable income available to the applicant to repay the monthly loan repayments. The maximum monthly loan repayment figure will be no more than 50% of the applicant's disposable income per month.
- Those applicants who are deemed not able to afford the owner-occupier loan at affordability test stage can apply for owner occupier repayable financial assistance, if deemed eligible.
- Improvements to the standard and overall quality of the accommodation to make it warm, safe or secure - works should bring it up to a reasonable standard for occupation.
- Works to convert an empty property or commercial building into one or more units to a reasonable standard so that it is suitable for immediate occupation by the owner-occupier.
Owner-occupier repayable financial assistance is only available for homeowners on low income who cannot afford a monthly repayment loan. Eligible works include:
- urgent repair works to resolve serious problems of disrepair including removal of Housing Health and Safety Rating System (HHSRS) hazards. Works will be restricted to remedying serious disrepair problems.
Loan amounts, term and fees
- The minimum loan will be £1,000, maximum loan amount will be £25,000 per property including fees.
- The maximum loan term: all loans to be repaid by end of March 2029.
- Loans will be interest-free.
- For owner-occupier loans a one off administration fee of £500 is charged to the applicant to cover the costs of processing applications - the fee can be paid in advance or included in the loan.
- For owner-occupier repayable financial assistance a one off administration fee of £250 is charged to the applicant to cover the costs of processing applications - the fee can be paid in advance or included in the loan.
- Owner-occupier loans will be repaid in monthly instalments.
- Owner-occupier repayable financial assistance loan is a lifetime loan, repayable in full as a lump sum on sale or transfer of the property.
- Loan to value ratio will not exceed 80%.
- Applicants must not owe any outstanding debt to the council at the time of making an application or have adverse credit history which may include County Court Judgements, Individual Voluntary agreements (IVAs), Debt Relief Orders, Bankruptcy (within last 6 years), Company Insolvency/ Liquidation.
- A schedule of works will be agreed with the applicant prior to the offer of any loan and will form part of the loan conditions
- where appropriate, planning and building regulation consent will be required for proposed works.
- Applicants will in normal circumstances be required to obtain two quotations for the proposed works, and engage their own contractor when the loan is approved by us.
- Payment of the loan following the loan approval will be through interim payments and at completion stage through a valuation by officers as the works proceed.
Loan assistance will not be available for the following:
- properties that are not of a permanent nature such as houseboats and caravans.
- structures that do not have building regulations approval.
- buildings not suitable for conversion to habitable dwellings.