皇冠体育app

1.1 Purpose

1.1.1 This section sets out the detail of Social HomeBuy and Homes England鈥檚 requirements to be followed by eligible Registered Providers.

1.1.2 It is a condition of our funding that eligible Registered Providers comply with these procedures and any subsequent requirements.

1.2 Context

1.2.1 Social HomeBuy allows eligible tenants of Registered Providers who participate in the scheme and who occupy eligible properties to purchase their social or affordable rented housing at discount either outright or on shared ownership terms (i.e. part buy/part rent 鈥� please see Help to Buy: Shared Ownership (section 1.3).

1.2.2 Social HomeBuy discounts are funded under section 19 of the .

1.2.3 Sales under Social HomeBuy are a relevant event for the recycling of grant through the Recycled Capital Grant Fund (RCGF). Please see the Registered Provider Grant Recovery chapter for further information. 皇冠体育app remaining net receipts from Social HomeBuy sales no longer have to be retained by providers in a Disposal Proceeds Fund (see below). Instead, net receipts (after any capital grant has been recycled) may be reinvested in line with the provider鈥檚 objects and purposes. For further information please see below

1.3 Main features of the scheme

1.3.1 Social HomeBuy can only be used to purchase self-contained property for rent. 皇冠体育appre are eligibility criteria for both properties (these are similar to those for Right to Buy/Right to Acquire) and tenants.

1.3.2 Where a Registered Provider has decided to offer Social HomeBuy, purchasers are allowed to buy their rented home outright at the outset or on shared ownership terms. With regard to shared ownership the cost of any share will be based on a percentage of the full market value.

1.3.3 If buying on shared ownership terms the range of shares can be any amount between 25% (minimum purchase) and 90%. 皇冠体育app final staircasing share must be a minimum of 10%. Please see section 6.2.1 below.

1.3.4 All Social HomeBuy leases must allow the purchaser to buy further shares and staircase to full ownership.

1.3.5 皇冠体育app purchaser is entitled to a discount; and if buying on shared ownership terms a discount is available on both the initial and subsequent shares purchased. 皇冠体育app discount limits are the same as those applying to properties bought on Right to Acquire terms in that locality. Discounts are pro-rated for shared ownership purchases according to the size of the initial and any subsequent share purchased. For an example please see below and also section 8 below.

1.3.6 皇冠体育app discount is repayable if the purchaser sells the property within five years, on the same basis as the Right to Acquire/Right to Buy.

1.3.7 皇冠体育app current Right to Acquire discounts are set out in the and rural designated areas within SI 1997 (Nos. 620-625) and SI 1999 (No. 1307).

1.3.8 Landlords may offer their tenants an alternative property to purchase in certain circumstances - see section 8.4.3 below.

1.3.9 Social HomeBuy gives providers the opportunity to:

• Sell their permanent social and affordable rented housing stock to secure or assured tenants at a discount
• Include non-grant funded property
• Offer home ownership to tenants who do not qualify for the Right to Acquire/Right to Buy or cannot afford to purchase outright
• Provide replacement affordable homes for rent by using the disposal proceeds receipts from sales together with private finance (subject to new de-regulatory measures introduced on 6 April 2017)
• Develop mixed, balanced and sustainable communities and
• Use sums in their Disposal Proceeds Fund to convert existing tenanted property to provide large family homes where required (subject to new de-regulatory measures introduced on 6 April 2017)

1.3.10 Social HomeBuy gives eligible tenants the opportunity to:

• Purchase their current home which may not qualify for Right to Acquire/Right to Buy because it was provided without grant funding or grant funded prior to 1 April 1997 (some exclusions apply - see Right to Acquire, section 3)
• Purchase their current home on shared ownership terms, making the purchase affordable and sustainable
• Benefit from a pro-rata purchase discount if they buy regardless of whether they buy outright or on shared ownership terms rather than purchasing outright

1.3.11 Scheme submissions must comply with the with the requirements laid out in the Finance chapter (section 2) of this guide.

1.4 Notifications to the Regulator of Social Housing

1.4.1 Registered Providers do not need to notify the Regulator of Social Housing when issuing shared ownership leases that cannot be classed as assured tenancies (for example, because of low rent).

1.5 Targeting and publicity

1.5.1 Registered Providers offering Social HomeBuy are responsible for distributing publicity material to their tenants and are required to publish their policy. Homes England has produced publicity information which is available on our website. Registered Providers can download this information to provide to tenants in its entirety as a supplement to its own publicity/promotional material. General information about the product should be available from Help to Buy Agents (please the Glossary for a definition of Help to Buy Agents).

1.6 Funding arrangements

1.6.1 When a Registered Provider offering Social HomeBuy agrees an application from an eligible tenant with an eligible property, they should claim grant from Homes England in line with the requirements of the Capital Funding Guide, in a similar way to claiming grant for Right to Acquire purposes.

1.6.2 Grant should be claimed to cover the discount following completion of the sale. Where tenants are purchasing on shared ownership terms grant should be claimed on completion of the initial sale, and balances claimed as appropriate on completion of the purchase of any subsequent shares, pro-rated to the share that is purchased.

1.6.3 Eligible Registered Providers must consult their private lenders prior to deciding to offer Social HomeBuy to ensure properties can be released from the lender鈥檚 security.

2.1 General

2.1.1 Social HomeBuy is funded under section 19(3) of the as Financial Assistance. This is distinct from Social Housing Assistance granted to develop schemes.

2.1.2 Social HomeBuy sales must be based on the market value of the property as determined by a Royal Institution of Chartered Surveyors (RICS) qualified independent valuer.

2.1.3 Sales on shared ownership terms are based on a percentage of the full market value of the property. Valuations are required both at the initial sale and on any subsequent staircasing. 皇冠体育app cost of the valuation for an initial sale is met by the Registered Provider from the proceeds of sale. 皇冠体育app cost of valuation for staircasing sales is to be met by the purchaser under the terms of the staircasing provisions in the Social HomeBuy shared ownership lease.

2.2 Rents and service charges

2.2.1 皇冠体育app requirements regarding the rent and service charges for Social HomeBuy are the same as for Shared Ownership (see Help to Buy: Shared Ownership section 4.3). Also see the additional requirements at section 7.1.1 below.

2.2.2 皇冠体育app level of the service charge should not vary from the proposed service charge notified at the formal offer stage, see section 8.6.3 below.

2.2.3 Rents on unsold shares in Social HomeBuy (where 100% is not owned) should conform to the requirements for shared ownership. Please see Help to Buy: Shared Ownership section 4 on rents and service charges.

2.2.4 Where rents are not in line with the published requirements, it could lead to grant being denied or withheld until the rents including housing benefit eligible service charges are brought into line.

2.3 Financial viability

2.3.1 皇冠体育app requirements regarding the applicant鈥檚 financial capacity for Social HomeBuy are the same as for shared ownership.

2.3.2 In considering whether to provide Social HomeBuy, Registered Providers are expected to have taken into account the proposed Social HomeBuy receipt and rental income and to ensure that any long term operational costs, including the repayment of loan principal and interest, can be met. Any initial revenue deficits should be within the provider鈥檚 general capacity. 皇冠体育app Regulator of Social Housing will monitor the effect of sales on the provider鈥檚 housing development plans and general financial status

3.1 General

3.1.1 Registered Providers providing Social HomeBuy should claim grant from Homes England through its Investment Management System (IMS). Claims must not be made in advance of need and should be made following completion of either:

• Outright sale or
• Initial share sold and any subsequent shares sold

4.1 General

4.1.1. This section sets out the applicant criteria, details of public sector landlords, and grounds for rejection or suspension of eligibility.

4.2 Eligibility criteria

4.2.1 Applicant eligibility criteria for Social HomeBuy are the same as for Right to Acquire, (please see Right to Acquire section 2) except that, where tenants are purchasing on shared ownership terms, Registered Providers will be required to carry out affordability checks to establish whether the applicant can afford and sustain Social HomeBuy. Registered Providers may wish to use Homes England鈥檚 shared ownership eligibility and sustainability calculator (Help to Buy: Shared Ownership - section 6) for this. However, Registered Providers will need to consider the discount available to the purchaser when assessing affordability.

4.2.2 Registered Providers may offer Social HomeBuy to tenants who have the Right to Acquire, Right to Buy or Preserved Right to Buy. Tenants must opt for one product or the other. Discounts cannot be combined, nor can a Registered Provider claim grant other than for funding discounts due in respect of either Social HomeBuy or Right to Acquire.

4.2.3 Tenants who are eligible for the Right to Buy and are living in an eligible property will have the additional option to purchase on shared ownership terms under Social HomeBuy if they cannot afford to buy outright under the statutory schemes.

4.2.4 Those tenants whose homes qualify for a higher Right to Buy discount than the local Right to Acquire discount will be limited to the Right to Acquire discount limits if purchasing through Social HomeBuy.

4.3 Public sector landlords

4.3.1 A tenancy with any of the public bodies listed in Right to Acquire section 2.3 will count as an eligible residency for Social HomeBuy purposes.

4.4 Anti-social behaviour

4.4.1. Applications can be rejected or suspended on the grounds of anti-social behaviour (see Right to Acquire section 2.5 and following paragraphs).

4.4.2 Some tenants may be eligible to apply for Social HomeBuy whilst also having the Right to Buy or Acquire (see section 4.2.2 above). Tenants cannot apply to buy under both statutory and voluntary schemes, but when processing Social HomeBuy applications Registered Providers will need to take in to account which of the following categories (if any) an applicant falls in to:

• Social HomeBuy applicants who may be entitled to Right to Acquire/Right to Buy and who are already subject to a 鈥榮uspension order鈥�
• Social HomeBuy applicants who could be subject to an application for a Right to Acquire/Right to Buy 鈥榮uspension order鈥� during their Social HomeBuy claim and sales process
• Social HomeBuy applicants who don鈥檛 currently have the Right to Acquire/Right to Buy but are in the process of meeting the five-year tenancy qualification period and could not be the subject of a 鈥榮uspension order鈥� until they qualify for Right to Buy/Right to Acquire but where Registered Providers may wish to apply a 鈥榮uspension status鈥� or
• Social HomeBuy applicants who don鈥檛 have the Right to Acquire/Right to Buy and will therefore never be the subject of a 鈥榮uspension order鈥� but where Registered Providers may wish to apply a 鈥榮uspension status鈥�

4.4.3 As advised in above in section 4.4.2 where a Right to Acquire/Right to Buy 鈥榮uspension order鈥� already exists Registered Providers should apply a 鈥榮uspension status鈥� in respect of Social HomeBuy applications. Where Registered Providers are in the process of applying for a Right to Acquire/Right to Buy 鈥榮uspension order鈥� they should simultaneously consider applying a 鈥榮uspension status鈥� to any Social HomeBuy applications.

4.4.4 In cases of doubt providers should initially approach the Provider Management team for further guidance.

5.1 General

5.1.1 Not all properties owned by Registered Providers are subject to Social HomeBuy. Eligible, excluded and exempt properties are set out below.

5.2 Eligible properties

5.2.1 Registered Providers may offer Social HomeBuy across all their social and affordable rented stock (subject to the mandatory exclusions below) or target properties for sale in particular locations. For example, where they wish to introduce tenure mix on an estate. Stock that was not previously grant funded may be included.

5.2.2 Some properties that would be ineligible for Right to Acquire/Right to Buy may be eligible for Social HomeBuy. For examples of properties funded by grant prior to 1997 that are ineligible for Right to Acquire but could be eligible for Social HomeBuy, please refer to sections 1.3.9 and 1.3.10.

5.3 Excluded properties

5.3.1 Properties excluded from the Right to Acquire are excluded from Social HomeBuy - for example properties in designated rural areas, in designated protected areas or those let in connection with employment.

5.3.2 For details on ineligible and excluded properties see Right to Acquire section 3, and for an explanation of designated protected areas see Help to Buy: Shared Ownership section 1.3.24.

5.4 Exempt properties

5.4.1 In addition to the mandatory exclusions outlined in 5.3 above (that is properties excluded from Right to Acquire) Registered Providers may consider it appropriate to exempt other categories of properties.

5.4.2 Registered Providers must remember that they have the opportunity to exercise the right of first refusal in respect of future resales and therefore should limit the exercise of this exemption as far as possible.

5.5 Policy requirements

5.5.1 Registered Providers that choose to participate in the Social HomeBuy initiative must draw up a published policy specifying a list of properties, or types of properties, that are excluded or exempted from their programme. This must be in place prior to any sales or marketing of the product.

5.5.2 When drawing up their policy, Registered Providers should consult those local authorities in which they are proposing to offer Social HomeBuy to tenants. If no policy is in place prior to sales and marketing, it will be assumed that all properties in that local authority will be included in the programme, other than those covered by the mandatory exemptions.

5.5.3 This policy must be easily and readily available to tenants, and Registered Providers must be seen to be operating it on a fair and consistent basis. It would not be acceptable, for example, for a Registered Provider to decide whether to sell on a case-by-case basis in response to demand from individual tenants.

5.5.4 Once published, the policy must apply to the whole of the Registered Provider鈥檚 programme. However, Registered Providers can vary the list of properties exempt from the programme during the programme period subject to the agreement of Homes England鈥檚 Provider Management team.

5.5.5 Where a tenant has received a formal offer from the Registered Provider, and provided that the tenant responds within eight weeks and complies with the requirements of the product, they must be allowed to complete the purchase. This is the case even if the policy changes and that property is now in an exempt category.

6.1 General

6.1.1 Homes England鈥檚 standard requirements relating to shared ownership leases are set out in Help to Buy: Shared Ownership section 5. 皇冠体育appse requirements all apply to Social HomeBuy schemes.

6.1.2 Additional requirements that are specific to Social HomeBuy are set out in this section.

6.1.3 To assist Registered Providers Homes England has published model Social HomeBuy shared ownership house and flat leases. Copies of both can be located in Help to Buy: Shared Ownership section 11.

6.2 皇冠体育app price

6.2.1 皇冠体育app price payable by the tenant (price of the Social HomeBuy lease) upon the grant of a lease plus the available discount must be equal to the relevant percentage of the full market value of the property as assessed by an independent Royal Institution of Chartered Surveyors (RICS) qualified valuer (please see section 8 below). 皇冠体育app initial share purchased must be at least 25% (please see section 1.3.3 above). Tenants should buy the largest initial share that they can afford and sustain, to the nearest percentage point. Shares are not restricted to the nearest 5%. However the minimum additional share through staircasing that can be purchased is 10%. This minimum also applies when buying the final share. For example, if a shared owner owns 85% in order to buy the property outright they would need to purchase the remaining 15% accordingly.

6.3 Rent waiver

6.3.1 As with Shared Ownership, rent will be payable on the unsold equity share. For more information, please see section 7 below.

6.3.2 Registered Providers who wish to waive rent for Social HomeBuy purchasers may do so from their own resources. Rent may be waived for a specified period.

6.4 Nomination and right of first refusal

6.4.1 Registered Providers have the right to nominate the next purchaser(s) when the current Social HomeBuy leaseholder wishes to sell their share. Additionally Registered Providers have the right of first refusal in respect of both houses and flats where owners originally purchased outright, or purchased on shared ownership terms and have subsequently staircased to 100% and who now wish to sell.

6.5 Repayment of Social HomeBuy discount

6.5.1 If a shared owner sells their initial or subsequent share within five years of benefiting from the Social HomeBuy discount, the discount is repayable (see section 8.3 below).

6.5.2 Repayment of the Social HomeBuy discount for a five year period is required to be protected by a restriction that must be entered on the Land Registry documents. 皇冠体育app covenant for repayment must be inserted in conveyances and Social HomeBuy shared ownership leases. A model form of wording is available at Right to Acquire section 4.12.

6.5.3 皇冠体育app Registered Provider鈥檚 solicitors must insert the Social HomeBuy discount percentage figure in the particulars of the Shared Ownership lease. This figure must equate to the percentage value of the discount given to the buyer compared to the property鈥檚 sale price. For further guidance please see below.

6.5.4 Social HomeBuy discounts paid in respect of subsequent staircasing sales will also be subject to a five-year repayment period. Individual five year repayment periods must be applied to each subsequent staircasing and should run from the date the further shares are purchased. For an example please see below. Registered Providers will need to keep accurate records.

6.5.5 皇冠体育app requirement to repay the discount consists of a charge that must rank immediately after that of the purchaser鈥檚 lender. If, in the future, the new owner wishes to extend their mortgage to fund works to the property the Registered Providers may postpone its charge in favour of the lender. 皇冠体育app charge should not be postponed for any other reason.

7.1 General

7.1.1 皇冠体育app requirements in relation to the setting of rents and service charges in Social HomeBuy Shared Ownership leases are the same as for shared ownership (please see Help to Buy: Shared Ownership section 4).

7.1.2 皇冠体育app shared ownership requirements regarding quality of management and maintenance services, and service charges apply to Social HomeBuy, but there are also additional requirements which are set out in the Right to Acquire chapter (see also below).

7.2 Quality of Management & Maintenance Services & Service Charges

7.2.1 See Help to Buy: Shared Ownership 4.3 for the shared ownership requirements.

7.2.2 Although Social HomeBuy is not subject to the statutory provisions of the Right to Acquire/Right to Buy, Registered Providers are required to give Social HomeBuy leaseholders (whether they are shared owners or outright owners) similar protection as Right to Acquire/Right to Buy purchasers with regard to service charge and improvement contribution estimates. Provisions concerning service charge estimates and sinking fund contributions must be set out in the shared ownership lease. Please see Right to Acquire 4.8 for the additional requirements.

7.2.3 Registered Providers may use their discretion should they wish to make a contribution towards any maintenance costs for tenants purchasing Social HomeBuy on a shared ownership basis. Such contributions will not be eligible for grant funding nor is this a permitted use of the Recycled Capital Grant Fund (RCGF) or the Disposal Proceeds Fund (DPF). Please see the Regulator of Social Housing鈥檚 guidance on changes to the Disposal Proceeds Fund. 鈥�

8.1 General

8.1.1 For the purposes of this section of the guide, the term landlord will be used instead of the term Registered Providers and applicants will be referred to as tenants. This is to avoid any confusion over which part of the process applies to which party.

8.1.2 As per section 1.2.3, receipts from Social HomeBuy sales are required to be credited to the Registered Provider鈥檚 Recycled Capital Grant Fund (RCGF). In the event that a tenant鈥檚 application for Social HomeBuy does not complete, landlords are advised that the cost of abortive valuation, legal and survey fees may be deducted from the sale proceeds of a subsequent sale which does go ahead. This is provided that it does not result in a negative balance for the RCGF. If deductions would lead to a negative amount, the balance of abortive costs may be deferred until the next sale that proceeds.

8.1.3 It is not Homes England鈥檚 intention to be prescriptive as to the sales process and administration. However, in the interests of efficiency we would encourage landlords to take steps to identify serious purchasers and minimise unnecessary administration. We therefore recommend a two stage sales process to determine:

• Eligibility (of both the tenant and the property) and
• 皇冠体育app calculation of the sale price and the discount available

8.1.4 皇冠体育app first stage, following enquiries from tenants, is to provide broad-brush information to enable tenants to make an informed choice as to whether to proceed or not with a formal application taking in to account affordability and sustainability criteria (Stage 1A). For further information please see section 8.4.2 below.

8.1.5 If tenants wish to proceed and respond with a formal written application landlords will be required to check:

• Whether the property is eligible to be bought and
• Whether the tenant(s) is eligible for Social HomeBuy (Stage 1B)

Having ascertained whether or not the main criteria have been met it is at this point that landlords must notify tenants accordingly (Stage 1B). If eligible, landlords should ask tenants to confirm their interest in proceeding with their application.

8.1.6 皇冠体育app second stage involves confirmation of:

• 皇冠体育app sale price (following a formal valuation)
• 皇冠体育app equity to be purchased
• 皇冠体育app discount entitlement
• 皇冠体育app formal mortgage offer and
• 皇冠体育app associated costs and provisions

8.1.7 皇冠体育app above details will form the basis of the formal offer and must appear in the contract documentation.

8.1.8 皇冠体育app criteria on which applications might be prioritised, which may reflect local circumstances, must be included in landlords鈥� published policy statements.

8.2 Discounts

8.2.1 A discount is available when purchasing an eligible Social HomeBuy property, based on the percentage of the property being bought (please see section 1.3.5). Purchasers are not entitled to more than the maximum discount available for the locality in which they are purchasing.

8.2.2 Should the Social HomeBuy discount represent more than 50% of the value of the property (unlikely but theoretically possible) the maximum amount of discount available shall be 50% of the value of the property. This will apply to situations where the tenant is looking to purchase the property outright.

8.3 皇冠体育app tenant鈥檚 application

8.3.1 Prior to submitting a formal written application tenants would normally make an initial expression of interest in purchasing their home. Landlords are required to respond to an expression of interest as per section 8.4 2 below (Stage 1A).

8.3.2 For the process to proceed beyond stage 1A, a formal written application to purchase under Social HomeBuy must be made by the tenant and sent to the landlord. On receipt of the written application, the landlord must respond confirming (or not) the tenant鈥檚 eligibility as per section 8.4 below (Stage 1B).

For a comment on the written application please see below.

8.4 皇冠体育app landlord鈥檚 response

8.4.1 Response to an initial enquiry

8.4.1.1 When discussing applications to purchase with tenants, landlords must encourage them to buy the maximum share they can afford and sustain. For further guidance please see below.

8.4.1.2 Landlords must formally respond to all expressions of interest. Please see below for a model response.

8.4.1.3 Eligibility checks are not required at this stage (Stage 1A) and the landlord is only required to provide indicative cost and discount information based on the assumption that the tenant is eligible. 皇冠体育app information that must be provided at this stage is:

• An indication of the market value of the property to be sold. At this stage a formal valuation is not required but can be based on comparative house price details from appropriate commercial real estate or local estate agents鈥� particulars. By using a web-based assessment tool to determine the actual, or an approximate, house price valuation, costs can be confirmed or minimised at this point for both the landlord and the tenant should they decided not to proceed
• 皇冠体育app total cost of purchasing outright or a share and how it is calculated. 皇冠体育app total amount of discount applicable if purchased outright at that time in that location, (it is recommended that landlords also provide an example of how much discount might be available if purchasing on shared ownership terms)
• 皇冠体育app total amount of discount applicable if purchased outright at that time, in that location; it is recommended that landlords also provide an example of how much discount might be available f purchasing on shared ownership terms
• If purchasing on shared ownership terms the total rent and possible service charges payable on the property

Example

Estimated value of home: 拢180,000

Maximum Discount: 拢9,000

Your share in percent	Purchase Price	Social HomeBuy Discount	Share Price	Monthly Mortgage	Monthly rent @ maximum of 3% of unsold equity	Monthly Service Charge	Total Monthly Charge
25	拢45,000	拢2,250	拢42,750	拢202	拢337.50	拢100	拢639.50
30	拢54,000	拢2,700	拢51,300	拢243	拢315	拢100	拢658.00
35	拢63,000	拢3,150	拢59,850	拢283	拢292.50	拢100	拢675.50
40	拢72,000	拢3,600	拢68,400	拢324	拢270	拢100	拢694.00
45	拢81,000	拢4,050	拢76,950	拢364	拢247.50	拢100	拢711.50
50	拢90,000	拢4,500	拢85,500	拢404	拢225	拢100	拢729.00
55	拢99,000	拢4,950	拢94,050	拢445	拢202.50	拢100	拢747.50
60	拢108,000	拢5,400	拢102,600	拢485	拢180	拢100	拢765.00
65	拢117,000	拢5,850	拢111,150	拢526	拢157.50	拢100	拢783.50
70	拢126,000	拢6,300	拢119,700	拢566	拢135	拢100	拢801.00
75	拢135,000	拢6,750	拢128,250	拢607	拢112.50	拢100	拢819.50
80	拢144,000	拢7,200	拢136,800	拢647	拢90	拢100	拢837.00
85	拢153,000	拢7,650	拢145,350	拢688	拢67.50	拢100	拢855.50
90	拢162,000	拢8,100	拢153,900	拢728	拢45	拢100	拢873.00
95	拢171,000	拢8,550	拢162,450	拢769	拢22.50	拢100	拢891.50
100	拢180,000	拢9,000	拢171,000	拢809	拢0	拢100	拢909.00

Assumptions

1. Social HomeBuy Discounts are pro-rated for depending on the size of the share being purchases. Where a property has a maximum discount available of 拢9,000 and a purchaser wishes to buy 25% the maximum discount available is 拢9,000 x 25% - 拢2,250

2. Share price = purchase price 鈥� discount

3. Monthly mortgage figures are obtained from the

It is assumed that:

• 皇冠体育app interest rate is 3%
• 皇冠体育app loan term is 25 years
• 皇冠体育app payment type is repayment

1. Monthly rent = (outstanding loan value x (interest rate/100)) / 12

It is assumed that the provider charge on rent is 3%

e.g. for a 25% share the outstanding loan is 拢135,000 the monthly rent is

= (拢135,000 x (3/100)) / 12

= 拢135,000 x 0.03 / 12

= 拢337.50

8.4.1.4 This response must advise the tenant that, if they wish to proceed based on the indicative information, a formal written application must then be made.

8.4.2 Response to a Formal Application

8.4.2.1 In response to a formal written application (on an application form if applicable), landlords must now determine both the tenant鈥檚 and the property鈥檚 eligibility by checking:

• That any application form has been correctly completed and signed and dated by the tenant(s)
• That the tenant(s) are on a secure or assured tenancy (note that assured shorthold tenancy or long leaseholders are excluded from the Social HomeBuy initiative)
• 皇冠体育app property is not in an excluded or exempt category
• 皇冠体育app tenant(s) has been a public sector tenant for five years (see section 4 above)
• Where the property is charged to a private lender the lender is willing to release their charge
• Whether there is an effective possession order
• Whether the tenant is the subject of a suspension order (see section 4 above)
• That the tenant has certified in the application that he/she is not an undischarged bankrupt and
• Whether the tenant or co-purchasers have previously received a discount to purchase a property from a public sector landlord. For further guidance please see below

8.4.3 Offer of an alternative property

8.4.3.1 It is anticipated that tenants will normally look to purchase the home that they are currently renting. 皇冠体育appre is no requirement for landlords to offer an alternative property, but they may choose to do so. For further guidance please see below.

8.4.3.2 On completion of the checks detailed at 8.4.3 the landlord must respond to the tenant either confirming or denying eligibility.

8.4.3.3 Where the tenant or property is ineligible a detailed explanation must be given. If eligibility is confirmed the tenant must be asked if they still wish to proceed with their application, and to arrange an appointment to discuss in detail how the product works.

8.4.3.4 A standard response based on the Stage 1B letter, should be sent. Please see below for a model response.

8.4.3.5 皇冠体育app above letter and information must be sent to the tenant within four weeks from receipt of their written application.

8.5 Tenant鈥檚 response agreeing to proceed

8.5.1 Following confirmation from their landlord that they are eligible to proceed the tenant must notify the landlord in writing within four weeks that they wish to proceed to stage 2 of the purchase process.

8.5.2 Landlords have discretion to extend the period for responding if there are reasonable grounds for doing so.

8.5.3 During this period the tenant will also be required to meet with the landlord or the landlord鈥檚 advisor to discuss the product in more detail and undergo a formal affordability and sustainability assessment.

8.6 Landlord鈥檚 formal offer

8.6.1 Having received the tenant鈥檚 written application, met with the tenant and undertaken affordability and sustainability assessments, the landlord should now be in a position to make a formal offer to the tenant. Please see below.

8.6.2 It is at this point that a formal valuation of the property should be obtained (please see 8.7 below). If landlords wish to obtain the formal valuation before this point to prevent any undue delay in the process they may do so, at their own discretion and risk.

8.6.3 皇冠体育app formal offer must include the following information:

• 皇冠体育app value of the property to be sold
• 皇冠体育app total cost of purchasing outright or a share and how it is calculated
• 皇冠体育app total amount of discount applicable for the purchase at that time in that location
• 皇冠体育app total rent payable on the property
• An estimate of the annual service charge/including sinking fund contributions (see Right to Acquire section 4.8) and
• A requirement that the tenant formally respond to the offer within four weeks if they wish to proceed

For a standard Stage 2 Formal Offer letter please see below.

8.6.4 Landlords must ensure that the formal offer and acceptance are subject to contract, are in writing and that the terms of the sale are agreed by both parties.

8.6.5 Please see guidance below for a suggested form that landlords could enclose with their formal offer notice for use by tenants to confirm an intention to proceed with the purchase.

8.7 Sales valuations

8.7.1 Most of the valuation requirements for Social HomeBuy are the same as those set out in Help to Buy: Shared Ownership section 2.3; however additional requirements for Social HomeBuy are detailed in the following paragraphs.

8.7.2 Landlords must not set Social HomeBuy sales prices above the market valuation.

8.7.3 皇冠体育app value of the property must be based on its open market value at the time of the application, and founded on the following assumptions:

• Any improvements undertaken by the tenant will be disregarded
• Any failure of the tenant to keep the property in good repair will be disregarded
• Any service charges or improvement contributions payable will not be less than the estimates contained in the landlord鈥檚 offer
• For freehold property, the landlord is selling a freehold interest with vacant possession and
• For leasehold property, the landlord is selling with vacant possession for the appropriate term, i.e. not less than 125 years (where applicable) or a term expiring 5 days before the term of the landlord鈥檚 lease is to expire

8.7.4 皇冠体育app valuation on initial sale should be carried out by an independent, RICS qualified valuer on behalf of the landlord.

8.7.5 Where a tenant disputes the valuation they must make a written representation to the landlord. 皇冠体育app landlord may use discretion whether or not to refer the property back to the independent valuer for review. Should the tenant then dispute the findings of the review, the landlord can apply for a new valuation from the district valuer whose decision will be final. 皇冠体育app district valuer鈥檚 costs will be met by the Ministry of Housing, Communities and Local Government. 皇冠体育app role and powers of the district valuer are set out in the Housing Act 1985. However, it should be remembered that Social HomeBuy is not a statutory scheme. 皇冠体育appse arrangements will only apply to the initial sales valuation. Any valuation arrangements in connection with the purchase of further shares should be contained within the shared owners鈥� lease.

8.8 Completing the sale

8.8.1 Once the applicant has returned the intention to proceed notice it is advisable for the landlord to issue an offer confirmation letter. This will ensure that both the landlord and the tenant are proceeding on the same basis with regard to the equity share percentage and other issues pertinent to the sale; and that both parties have an understanding of the agreed position.

8.8.2 As the tenant is required to exchange contracts within three months of the date of the property valuation, the landlord should not delay sending the offer confirmation letter.

8.8.3 皇冠体育app offer confirmation letter should include:

• A formal valuation of the property to be sold, on a market value basis
• Where applicable, the total rent payable on the property
• An estimate of the annual service charges/sinking fund contributions
• Details of any known structural defects
• 皇冠体育app provisions which, in the opinion of the landlord should be contained in the conveyance or shared ownership lease
• A suitable identification plan showing the boundaries of the property including the land to be sold and
• Details of any discounts received by the tenants in respect of a previous purchase

8.8.4 Landlords may at their discretion decide to undertake a survey to determine the future need for repairs and improvements.

8.8.5 On receipt of the tenant鈥檚 mortgage offer or other evidence of the means to purchase, landlords will be in a position to instruct their solicitors and confirm both the discount to be made available and total share the tenant is purchasing (if doing so on shared ownership terms), so that a formal offer of exchange can be made.

8.8.6 Landlords must check the following without undue delay before exchanging contracts:

• 皇冠体育app tenant is not in rent arrears
• A possession order has not been served during the period the tenant鈥檚 application has been processed
• 皇冠体育app tenant is not the subject of an anti-social behavioural suspension order/status, (please see section 4.4 above)
• 皇冠体育app mortgage offer is from a qualifying lending institution (please see the Glossary for a definition)
• Where a mortgage is not required by the tenant, that evidence of funds to finance the purchase has been provided and
• 皇冠体育app landlord鈥檚 private lender is prepared to release the property from its security

8.8.7 皇冠体育app tenant has three months from the date of the formal valuation (or longer if the valuation is given for a longer period) to exchange contracts and a further month in which to complete the purchase. Where the tenant fails to exchange contracts on the property within this prescribed period the application may be deemed to be withdrawn (except in circumstances where the delay is as a result of the landlord鈥檚 inaction).

8.8.8 Landlords must keep in regular contact with the tenant throughout the process to try to ensure that contracts are exchanged before the valuation expires.

8.8.9 In exceptional circumstances the landlord may use its discretion to extend the valuation period, for example where the delays have been wholly outside the control of the applicant or landlord.

8.8.10 Landlords鈥� instructions to their solicitor must include the requirement to secure the repayment of discount if sold within five years (and repayment of any subsequent discount within five years) by way of a covenant in the conveyance/transfer.

8.8.11 Subject to landlords being satisfied with the details provided by the tenant and their solicitors, they will then be in a position to complete the sale.

8.9 Qualifying lending institutions

8.9.1 Under current arrangements a mortgage can only be secured as a first charge, ahead of any charge the landlord may have, if it is provided by a qualifying lending institution (please see the Glossary for a definition).

8.9.2 Landlords must therefore ensure that any mortgage taken out by the tenant comes from a qualifying lending institution.

8.10 Submission requirements

8.10.1 Following legal completion, landlords must submit the following data using Homes England鈥檚 Investment Management System (IMS) when claiming grant.

• Property details
• Cost and grant calculations including discount and percentage share to be purchased, if relevant
• Where applicable rent and Housing Benefit eligible service charge data
• Date of legal completion of sale

8.10.2 Landlords must be able to confirm acceptance of the on screen certifications that appear at payment stage.

8.10.3 At the point of claiming grant landlords must confirm that the application for grant payment is correct and conforms to the requirements of the CFG.

9.1 General

9.1.1 皇冠体育app Post Sales issues for Social HomeBuy are similar to or the same as those for Right to Acquire and Shared Ownership. This section provides further details and links to the above chapters as appropriate.

9.2 Staircasing

9.2.1 For shared owners wishing to purchase further shares through staircasing the process is as per Help to Buy: Shared Ownership section 7.2. 皇冠体育app staircasing sales proceeds (excluding capital grant) may be reinvested in line with a Registered Provider鈥檚 objectives and purposes, as with other shared ownership purchases. Any capital grant attributable to that share must be recycled in accordance with the requirements set out in the Grant Recovery chapter, section 3.

9.2.2 Further Social HomeBuy discounts are available when staircasing. 皇冠体育app available discount must be calculated on a pro rata basis based on the percentage of share being purchased and Right to Acquire discount available for that location.

9.3 Repayment of discount

9.3.1 If a Social HomeBuy purchaser sells their property within five years, please see Right to Acquire 5.2.

9.3.2 Registered Providers must remember that, prior to April 2008, for those purchasing on shared ownership terms a pro rata discount was only available on the initial share purchased. 皇冠体育apprefore, if further shares were purchased prior to April 2008 the repayment provisions only apply to the initial discount.

9.3.3 From April 2008 discounts became available in respect of further shares purchased after that date. 皇冠体育appse discounts are also subject to the repayment provisions when the property is sold.

9.3.4 皇冠体育app principles on how to calculate the amount repayable will be the same as those for Right to Acquire 5.2.3, with regard to a link to the property value. Registered Providers will therefore need to consider what discounts were available, for example:-:

• Full discount upon 100% purchase
• Initial discount on shared ownership sales prior to April 2008 or
• Initial and any staircasing sales post April 2008

Each discount will be subject to its own 5-year repayment period.

9.3.5 Disregard of improvements value

When selling a Social HomeBuy purchased property, any increase in value resulting from improvements undertaken by the owner will be disregarded from the repayment calculation. For detailed requirements see Right to Acquire sections 5.3.5 and 5.3.6.

9.3.6 Please see Right to Acquire 4.12.1 for a model repayment of discount clause.

Registered Providers must ensure that a conveyance or lease has an appropriate discount repayment covenant included (see paragraph 6.5). Where the tenant鈥檚 mortgage has been provided by a qualifying lending institution this covenant will rank immediately after theirs. Otherwise the Registered Provider will have the first charge. Where further lending is needed to fund essential works to the property Registered Provider may postpone this charge in favour of the lender. 皇冠体育app charge should not be postponed for any other reason.

9.3.7 Exempted disposals

Please see Right to Acquire section 5.3 for details of circumstances in which Registered Providers may consider waiving discount repayment.

9.4 Mortgage difficulties flexible tenure and leasehold repurchase

9.4.1 Lenders may take action to repossess property if mortgage payments are not maintained (鈥榖eing in default鈥�). Registered Providers must refer to Homes England鈥檚 requirements as set out in Help to Buy: Shared Ownership 7.4.

9.4.2 Where a Social HomeBuy shared owner reduces, but still retains part of, their equity in the property no repayment of the discount is required. However, should the shared owner revert to being a tenant within the designated repayment period, the discount is repayable.

9.4.3 皇冠体育app requirements and opportunities for offering Flexible Tenure and Leasehold Repurchase to leaseholders who are struggling financially are set out in Grant Recovery 6.5 and Help to Buy: Shared Ownership 7.4.2 respectively.

10.1 General

10.1.1 Registered Providers must maintain accurate and complete records of Social HomeBuy transactions, both for reporting and audit purposes. This section sets out the requirements.

10.1.2 皇冠体育app Registered Provider must retain on file the following for Compliance Audit purposes (see also Programme Management section 8):-

• Solicitors鈥� letter confirming that the purchase has been completed and setting out the sum paid and date of completion
• A property schedule showing addresses, floor areas, and valuations for the completed properties, together with actual rents and housing benefit eligible service charges

10.2 Monitoring

10.2.1 Following completion of the purchase, Registered Providers must input Social HomeBuy sales data into Homes England鈥檚 Investment Management System (IMS) in order to draw down grant. This must be repeated for staircasing sales.

10.2.2 Grant will not be payable where Social HomeBuy records are incomplete or incorrect.

10.3 Certifications

10.3.1 皇冠体育app information provided by Registered Providers within IMS and on their annual Recycled Capital Grant Fund (RCGF) return is the means by which Social HomeBuy outputs will be monitored by Homes England.

10.4 CORE

10.4.1 Registered Providers are required to complete (CORE) sales logs in respect of all homes sold through Social HomeBuy. CORE is the remit of the Ministry of Housing, Communities and Local Government. Any queries about CORE or the appropriate forms should be referred to them.