Equity loan (shared equity)

Repaying a loan → Covid-19

In light of the current situation regarding Covid-19 restrictions, please see our latest guidance on property valuations and desktop valuations.

The equity loan is Wigan Council shared equity scheme where we provide an interest-free equity loan to help purchasers buy a new build home

It is available on certain new build developments across the borough, on specified plots, agreed by the Council and the developer.

The equity loan value is equivalent to 30% of the full market price of the property purchased. When the loan is repaid, the repayment amount will be based on the property value at the time.

With the 30% equity loan the purchaser is required to put down a minimum deposit of 5% of the full purchase price, meaning they only have to secure a mortgage for 65% of the property value (or possibly less with a larger deposit).

Full property price
5% deposit65% mortgage30% equity loan
You Bank/Building Society Wigan Council

Unlike shared ownership, there is no rent to pay on the 30%, and you own the property outright. The equity loan is secured as a second legal charge on the property, after your mortgage.

Repaying the loan

You are able to repay the equity loan to own up to 100% of the equity in the property.

The loan is repayable at the end of the maximum term of 25 years, or earlier upon the sale of the property. The loan can also be repaid in part or in full at any time during the 25-year term.

When you come to sell the property, you pay back to Wigan Council 30% of the property value at the time of repayment. This could be more or less than the original loan amount depending on property prices at the time.

During the 25 years you may buy the 30% equity in full through a single repayment, or in part in three separate 10% increments (or one 20% increment and one 10%). Each part repayment is based on the value of the property at the time of repayment.

Who can apply?

To be eligible for the scheme, you must satisfy one of the following conditions:

  • Live - You currently live in the borough and have done so for at least the last 6 months, or, you have lived in the borough for at least three of the last five years
  • Work - You currently work in the borough or have taken up an offer of employment within the borough
  • Family - You have an immediate family member who lives in the borough and has done for at least the last 6 months
  • Armed Forces - You are a former member of the armed forces who is returning to Wigan Borough upon discharge.

You must also pass our initial financial assessment, based on your household income and the full market value of the property being purchased, to assess that you need the assistance to buy the property, and that the scheme will be affordable for you.

If you are approved for the equity loan scheme an independent financial advisor must also assess your finances to make sure it is affordable for you to access the scheme.

Please note, stamp duty and service charges are applicable. You should discuss all associated costs with the Sales Team on each individual development as they will vary from scheme to scheme.

How to apply

To see what homes are available please visit the Properties Available to Buy page.

If you find a development that meets your needs, we advise you to visit the property or development in the first instance to confirm your choice (please check with developers for sales office opening arrangements).

After you submit your application form, please email affordablehomes@wigan.gov.uk as soon as possible with your supporting evidence and documentation for each applicant, which should include:

  • Photo ID, e.g. passport or driving licence
  • Your last 3 months’ payslips, or equivalent, e.g. 13 weeks’ payslips. Or, if you’re self-employed, your past two years’ tax returns or certified accounts
  • Evidence of other income
  • Evidence of your local connection.

What homes are available?

Our list of homes to buy tells you which homes are available with an equity loan through our scheme.

Watch the video below to see how the scheme has helped other people in the borough:

© Wigan Council