The Homes with Purpose model is straightforward. We accept loans and donations from ordinary people and use those funds to make an extraordinary difference for vulnerable people by buying houses as places that they can call home.
After just 18 months, 76 lenders plus donors have provided £1.5m to buy four houses to be used for refugee families and people who would otherwise be homeless. Lenders commit to £5,000 for 5 years, and select an interest rate of 1%, 2% or 3%. Most lenders were attracted by the prospect of a modest financial return and a social return.
Low-interest rates allow us to buy houses and rent them to tenants at below-market rates, providing vulnerable people with safe houses. After five years, lenders have the option to renew their loans or be repaid. Loans are repaid using capital accrued from rents during the five years along with new lending.
Read the steps below and find out more on our FAQs page.
Step 1: Request a Lending Pack
Our lending pack has all the information you need to make an informed decision. To request one, please use the contact form on our website. As you think about making a loan, we’re always on hand to answer your questions. Make sure you get the financial, tax and/or legal advice that you need (we’re not able to provide you with this advice).
Step 2: Agreeing to provide your support
After reading through the pack, if you would like to proceed we'll provide you with Loan Agreement Specific Terms. We will confirm when we’ve received your form.
Step 3: Checking your identity
Before we can accept your loan, we may need to carry out identity checks in line with anti-money laundering best practice (or our solicitors may need to during a house purchase process). We will get in touch with you when we’re ready to do this.
Step 4: Transferring your loan
If your loan is accepted by us and we’ve confirmed all the paperwork is in order we will send you our bank details so you can transfer the funds. We will notify you when we have received the relevant funds and the terms of the Homes with Purpose Loan will start from the date we have received those funds.
Step 5: During the loan term
We will pay your interest on a six-monthly basis.
Step 6: Renewing or returning the loan
We will contact you between six months and one year before your loan term is due to end to ask if you would like to renew the loan or would like the loan repaid.
Want to know more? Read our FAQs, or watch the model explained in this 1-hour webinar.
