Alderson Housing Trust

Discussion in 'Charities and Welfare' started by BiscuitsAB, Apr 10, 2012.

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  1. BiscuitsAB

    BiscuitsAB LE Moderator

    If anyone has any dealings with or knows anything about The Alderson Trust can they give me a shout. Pm and give me a phone number or I can give you mine.

  2. BiscuitsAB

    BiscuitsAB LE Moderator

    Follow up information.

    Birmingham city Council run a Veterans Home Buyer scheme, where by they will loan up to 10% of the purchase price of a property on a pay it back when you sell basis. I've just been told that it is also on an interest free basis.

    I am getting information e-mailed to me about the scheme and also details of Birmingham City councils Armed Forces Covenant Declaration.

    Have to say having just been given the bare bones of the covenant I'm rather impressed with the councils stance on the matter.
  3. Sounds good,BUT,find out how they define "shared equity". Is it a "loan" if the market drops and "shared equity" if the market gains?

    Read the fine print and get advice.
    • Like Like x 1
  4. BiscuitsAB

    BiscuitsAB LE Moderator

    Cheers mate I'm on that one.

    As a by line there are currently 3 Bungalows and half a dozen brand new flats that are fitted out for disabled ex-servicemen available in that list and in the existing Alderson trust property's. Disabled ex-SP will be given preference over normally discharged time served ex_SP.

    So if anyone knows of ANY disabled ex_SP who were med discharged from WW1 up to current Ops who live in Birmingham that would like or needs new accommodation then speak up and speak up loudly.

    We've all been critical in the past of councils and their lack of priority to Ex-Sp and the fact we feel we're a special case. Well it would seem that Birmingham City Council have also decided that not only are disabled ex-SP but ordinarily discharged SP a special case and are putting their money where their mouth is.

    Having just had a further conversation with Debbie Greenhill from the council, I am stunned at the amount of effort and thought that Birmingham CC have put into this. There are a whole raft of measures available to Ex-SP whether disabled or not and most of these measure are extended to members of the TA and Reservists who have been injured on OP's. They will even help with adaptions to property for disabled SP.
  5. "Shared equity mortgage

    A shared equity or shared appreciation mortgage (SAM) works differently from a normal home loan:
    You borrow, say, 20% of the value of the property as a SAM and instead of paying interest on it, you’re charged a percentage of the capital gain when you sell.
    For the remaining percentage of the home’s value (minus your deposit) you take out a normal home loan.
    This means your monthly repayments are lower than they would have been if you’d borrowed the whole amount under this loan.

    What paying back a portion of the capital gain means is that as the value of the property increases, so also does the repayment amount. And, of course, it’s very hard to predict just how much the capital gain is going to be. For example, in the last 20 years in Sydney, annual changes in the value of house prices ranged from a decrease of 3.9% (2004/05) to an increase of 46.1% (1988/89).

    The RISMARK/ADELAIDE BANK Equity Finance Mortgage (EFM) was launched about a year ago and is available in capital cities (and some other metropolitan areas) in all states except the NT and Tasmania. With it you can borrow 10%, 15% or 20% of the value of the property under a shared equity mortgage.

    After 25 years, or when you sell the house, you have to pay back the initial amount you borrowed, plus 20%, 30% or 40% (double the percentage you borrowed) of the capital gain. If you make a loss, the lender covers 10%, 15% or 20% of the capital loss, which is then deducted from the amount you have to repay.
    With this loan, if you’d bought a house worth $100,000 in June 1987 in Sydney and borrowed 20% ($20,000), on average it would have been worth $461,490 in June 2007, and if you’d sold it you’d have to pay back about $164,600. So the equivalent rate of interest you’d have been paying to RISMARK would have been about 10.6%.
    If you’d taken a loan over the same period, the average standard home loan rate would have been 9.5%. Obviously with a standard home loan, you’d have had to make regular repayments over the whole period, whereas with RISMARK you only pay a lump sum at the end.
    Over a shorter period the picture could look very different. For example, if you’d repaid the same loan of $20,000 after two years, following the massive jump in house prices in 1988/89, you’d have already owed $49,137, meaning you’d have paid RISMARK the equivalent of an interest rate of 45.8%. While this was a time with exceptionally high increases in house values, property values go in cycles and for a normal consumer it’s sometimes hard to guess at which point in the cycle you currently are.

    There are a number of other downsides to the RISMARK/ADELAIDE BANK product:
    At the time of writing, it could only be combined initially with a normal home loan from ADELAIDE BANK, which limits your choice of lender and products.
    Due to the way the property’s value is calculated, you won’t necessarily get your money’s worth if you make any improvements, especially in the case of DIY renovations.
    If you’re in default of the loan conditions and the house sells for less than you bought it, the lender doesn’t share the capital loss.

    A possible alternative

    A number of state government or state government associated lenders offer shared equity mortgages too. They often have much more generous conditions, but some aren’t available to everyone - they’re based on income and the price of the property.

    CHOICE verdict on shared equity mortgage

    A shared equity/shared appreciation mortgage is a very complicated product and very different ot other mortgage[B]. ]It’s crucial to understand the fine print: you need both legal and financial advice. While a normal mortgage diminishes over time and is likely to be easier to pay in later years when your income increases, the shared equity repayment amount grows with the value of the property. [/B]
    Obviously meanwhile you’re enjoying a better cashflow position as you don’t have to make repayments on the shared equity mortgage. But you become hostage to developments in house values. Shortly after a period of high capital growth is a very bad time to sell, even if your personal circumstances, such as having a baby on the way would make selling and upgrading the best option for you.

    The bottom line is that the only way you come out on top is if you experience low or negaitve growth in the value of your home - but why would you want to invest in property if you expect that?"

    Shared equity mortgage - Risky home loans - what to avoid - CHOICE
  6. BiscuitsAB

    BiscuitsAB LE Moderator

    Cheers for the concern mate, however I'll be in the position once I've read it to be giving the advice. I'll go through it with a fine tooth comb and will report back on this thread with all the Pros and Cons.
  7. Don't get me wrong, some of the social housing programs involving shared equity are very good but some are very bad.

    The devil is always in the detail but it is scary to see silly buggers signing their lives away on mortgages and loans they don't understand.

    Will be interested to see your report back mate.
  8. BiscuitsAB

    BiscuitsAB LE Moderator

    Right the answer is its a straight percentage buy in so if you borrow 10% you pay back 10% of the value on sale or the original ££££ borrowed if the property price has fallen. Pretty straight forward then!
  9. It is,however might be worth running a comparison with a straight home loan and see which works out better.

    Will have a look how readily available % rises in property prices are in Birmingham and have a look at the inflation rate (for DCF) and average variable interest rates and see which stacks up better.
  10. BiscuitsAB

    BiscuitsAB LE Moderator

    Its going to vary on a case by case basis and I'd suggest viability will be more down to net disposable income over gross cost.
  11. BiscuitsAB

    BiscuitsAB LE Moderator

    Bit of help please; Can anyone get me a number for

    143 Bde PRU
    Copthorne Bks
    SY3 8LZ

    I've got an e-maill addy but can't seem to find a phone number.

  12. Sorted. Did it work?
  13. BiscuitsAB

    BiscuitsAB LE Moderator

    Like magic, ta.
    • Like Like x 1