First-time buyers looking to get on the property ladder will soon be able to take advantage of a loan scheme to buy a long-term empty home.
There are currently 1,670 homes in the Potteries which have been empty for more than six months, with many becoming eyesores and magnets for crime and anti-social behaviour.
Under the scheme, the city council would contribute a deposit through an equity loan worth between 10 to 15 per cent of the property value.
This would enable applicants to buy the home with an 85 to 90 per cent mortage. They would then have to repay the loan over a 20-year period. The loan would be offered at 0 per cent for the first five years, rising to 1.5 percent after five years and three per cent after seven years.
However, to take advantage of the scheme buyers will have to meet a strict set of criteria.
The eligibility criteria
Applicants must have a right to reside permanently in the UK and either:
- Currently live or have had their primary home in Stoke-on-Trent for the last 12 months.
Worked in Stoke-on-Trent for the past 12 months.
Lived or worked in the city previously for at least 12 months.
Have a local family connection to the city.
Have lived within a 20-mile radius of the city for at least 12 months.
The applicant must not own property, whether in Stoke-on-Trent or elsewhere.
Applicants must live in the property as their main home until the loan is paid off in full. The property cannot be rented out whilst the loan agreement is in place.
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Applicants must not have a household income of more £60,000 per year.
Applicants must agree to reimburse the council for the deposit sum or equivalent deposit percentage at the time of sale (whichever is the greater)
How to apply
An applicant who meets the criteria and has identified an empty property with a purchase value of less than £150,000 would be required to complete an application form for the scheme.
The Private Sector Housing Team would then undertake necessary checks to ensure that they meet the criteria and calculate the amount of loan before sending a decision to the applicant prior to the applicant securing a mortgage.
If the applicant is eligible for the loan, this decision can be provided to the mortgage lender to evidence that they have the deposit.
The applicant would then liaise with the mortgage provider regarding the suitability of the property for a mortgage and their affordability requirements.
A loan offer will then be sent to the applicant with an agreement form for them to sign and return.