Affordable Homes Equity Loan Scheme

Wigan Council is offering to provide an interest-free equity loan to help get onto the property ladder.

The equity loan value is equivalent to 30% of the full market price of the property purchased. When the loan is repaid, the repayment amount will be based on the property value at the time.

With the 30% equity loan the purchaser is required to put down a minimum deposit of 5% of the full purchase price, meaning they only have to secure a mortgage for 65% of the property value (or possibly less with a larger deposit).

Full property price

5% deposit	65% mortgage	30% equity loan
You	Bank/Building Society	Wigan Council

Unlike shared ownership, there is no rent to pay on the 30%, and you own the property outright. The equity loan is secured as a second legal charge on the property, after your mortgage.

Repaying the loan

You are able to repay the equity loan so that you can own up to 100% of the equity in the property.

The loan is repayable at the end of the maximum term of 25 years, or earlier upon the sale of the property. The loan can also be repaid in part or in full at any time during the 25-year term.

When you come to sell the property, you pay back to Wigan Council 30% of the property value at the time of repayment. This could be more or less than the original loan amount depending on property prices at the time.

During the 25 years you may buy the 30% equity in full through a single repayment, or in part in three separate 10% increments (or one 20% increment and one 10%). Each part repayment is based on the value of the property at the time of repayment.

Who can apply?

To be eligible for the scheme, you must satisfy one of the following conditions:

• Live – You currently live in the borough and have done so for at least the last 6 months, or, you have lived in the borough for at least three of the last five years
• Work – You currently work in the borough or have taken up an offer of employment within the borough
• Family – You have an immediate family member who lives in the borough and has done for at least the last 6 months
• Armed Forces – You are a former member of the armed forces who is returning to Wigan Borough upon discharge.

You must also pass an initial financial assessment by Wigan Council, based on your household income and the full market value of the property being purchased, to assess that you need the assistance to buy the property, and that the scheme will be affordable for you.

If you are approved for the equity loan scheme by the Council an independent financial advisor must also assess your finances to make sure it is affordable for you to access the scheme.

Please note, stamp duty and service charges are applicable.

Once you have made enquiries with Edgefold Homes and have decided that you would like to reserve a home with us you can apply for an Equity Loan from Wigan Council, using the following link: Apply for an equity loan online.