BORROW UP TO 30% OF THE PRICE OF YOUR HOME.
What is an Equity Loan?
Our Equity Loan is designed specifically to give the extra capital you need to make up the difference between the most you can borrow on a traditional mortgage and the extra you need to buy the home you really want.
Our flexible Equity Loan can be taken up with a Places for People mortgage, or a mortgage from another lender.
How the Equity Loan Works
The Equity Loan is a fixed percentage of the value of your property. This means the amount you owe increases and decreases with the changing value of your property. The more your property increases in value, the more you will have to pay back.
Should your circumstances change and you decide you’d like to pay off your Equity Loan early you can do this whenever you want.
With Places for People you can pay off your Equity Loan in instalments as small as 1% at any time in the term. You will have to purchase equity at the value at the time of purchase. You will also need to pay for an independent valuation and any legal fees associated with the transaction.
Places for People can lend you up to 30% of the value of your new home – with no interest payments for the first ten years.
You can take out an Equity Loan on its own, with a mortgage from Places for People, or with a mortgage from any other lender.
For example, this means if you qualify for a mortgage of £112,000 you could buy a property worth up to £160,000.
NO INTEREST PAYMENTS FOR 10 YEARS
Our Equity Loan is interest-free for 10 whole years. That’s quite a time without having to pay a penny interest.
Like we said, it’s a genuine offer to help you move.
Should you wish to continue your Equity Loan after 10 years, interest will be charged at 2% over the Bank of England Base Rate on the original value of your Equity Loan.
If and when you sell
When you choose to sell your home, sorting out your Equity Loan couldn’t be easier. You simply give back to us the percentage you borrowed, at the current sale price.
Of course, dependent on the housing market at the time you sell, the amount you pay back could be higher or lower than the sum you originally borrowed.
Your mortgage
Places for People could offer you a mortgage alongside your Equity Loan to cover the remaining 70% of the value of your property.
Or you can arrange your own mortgage elsewhere. You can simply use our Equity Loan to make up the difference between that mortgage and the price of your new home.
It means you may not need to have as big a mortgage as you first thought – yet you can still afford the home you want. You also have the option that if you wanted to stretch yourself a little further and buy a slightly more expensive home, you can.
If you wish to put down a deposit, you can.
Who can apply?
Anyone can apply for an Equity Loan on a selection of Places for People properties.
