January 2006

The January 2006 Capital Funding Guide, KWL chapter has been replaced with version 2 to reflect a correction to clause 3(16)(d) and clause 3(18)(d) of the house and flat lease (respectively) to reflect the changed clawback provision from 2 to 5 years, together with a revision to KWL-3 paragraph 14.

The opportunity has also been taken to update the London Challenge Key Teacher points details within Annex B: with a new entry in respect of Teaching & Learning Responsibilities points and Challenging schools points being renamed as Working in Schools with high levels of Free School Meals.

In many instances throughout this guide it requires RSLs to contact their local Corporation office for further guidance or approval on investment matters. Unless specified otherwise RSLs should initially contact their local Investment Officer. Various entries have been amended accordingly.

SALE

The current rules prohibit applicants who have existing properties unless they are nominated by the Local Authority and sell their existing home at the same time as applying for Shared Ownership. In exceptional cases the Corporation is prepared to waive this rule where an applicant is prevented from accessing or selling their existing property. RSLs are required to contact their local Corporation Investment Officer. SALE-1, para 2.1, is amended accordingly.

Revised model Shared Ownership Leases are now available as Annexes to this chapter. There are a number of revisions to SALE-9 reflecting the changes and RSLs are strongly encouraged to read this section. The main changes relate to a new fundamental clause of Right of First Refusal/Pre-emption, and new restrictions which need to be registered with Land Registry.

Stamp Duty Land Tax may be payable on the rental element of Shared Ownership schemes. Guidance at SALE-9 para 2.9 etc has been updated together with details of a SDLT Enquiry Line which can calculate the amount of SDLT payable. RSLs are encouraged to make potential purchasers aware of this service.

HOMEBUY

Transitional arrangements have been introduced for Homebuy applications assessed as eligible and agreed on or after 1st January 2006. New guidance is contained in HOMEBUY-1, Section 4, with subsequent sections being renumbered accordingly. RSLs are advised to amend any publicity material and documentation accordingly.

Following enactment of The Social Landlords (Additional Purposes or Objects) (Amendment) (England) Order 2005, (Statutory Instrument 2005 No. 2863), with effect from November 5th 2005, references to qualifying lenders have been amended. Qualifying lenders are persons authorised under the Finance Services and Markets Act 2000 and given permission to enter into regulated mortgage contracts. Amendments include HOMEBUY-1, section 6 and the standard letters at HOMEBUY-7.

The current rules prohibit applicants who have existing properties unless they are nominated by the Local Authority and sell their existing home at the same time as buying through Homebuy. In exceptional cases the Corporation is prepared to waive this rule where an applicant is prevented from accessing or selling their existing property. RSLs are required to contact their local Corporation's Investment Officer. HOMEBUY-2, para 2.1, bullet point 2 is amended accordingly.

RTA

In the July 2005 version of this guide RTA-1, para 3.2 introduced Statutory Instrument 2005 No.1735 which requires landlords to publish and provide certain information to tenants relating to RTA. This paragraph has now amended to advise RSLs they cannot meet this obligation by issuing the Corporation's information booklet.

KWL

See above Homebuy entry in respect of Qualifying lenders -- KWL-2 para 2.12 has been amended accordingly.

KWL-1, section 14 introduces Cascade Principles -- options for consideration where the up take of New Build units is slow.

Previous KWL-1 section 14 is renumbered as 15.

Police Community Support Officers has been added to the Metropolitan Police list of eligible keyworkers for shared ownership, new build homebuy and intermediate rent only.

Key worker eligibility criteria are revised. In the main Annex B relates to Homebuy with new Annex B(ii) relevant for Shared Ownership and Intermediate Rent.

Clawback provisions in respect of Shared Ownership now apply if key workers leave a qualifying employment within 5 years. KWL-3 section 4 and 14 are amended accordingly.

The Right of First Refusal/Pre emption is now a fundamental clause and KWL-3 para 11.7 is amended to reflect this.

New model house and flat leases are provided at KWL-3, sections 12 and 13.