The Home Improvement Scheme is aimed at over 65’s who have a property which is in need of repair or refurbishment but can’t get the cash to carry out the work.
Terry Pritchard, head of sales and board director at LRS, said: “This scheme is aimed at the cases that an intermediary would usually discard after they were turned down by equity release providers.
“We will lend on the properties that other lenders deem to be unmortgageable as long as we can see where the improvements will come from.”
Once a case is passed to LRS homeowners are assigned a client relationship manager who will act as the sole point of contact and both an in house and an independent survey are carried out to assess the properties current and post renovation value.
LRS will then provide the homeowner with a package which is tailored to their individual housing, health and financial needs. This includes everything from refurbishment, adaptations, redecoration and access to support services.
The service is fully project managed and repair firms are selected from the LRS panel of approved contractors.
Pritchard said: “This scheme is for people in the community. We have a full division of contractors ready to go and to ensure the work is both on budget and on time all of our contractors have penalty clauses in their terms.
“We also set the home up to ensure that people can keep living in their property throughout the entire process and liaise with the local authority to ensure the homeowner gets all the help they need.”
The scheme is financed by equity release provider more 2 life and is currently being piloted in London and the South East where there are an estimated 2,500 homes that could benefit from the scheme.
Pritchard added: “It is our decision to keep the scheme local at the moment as there is so much to do in London and the South East.
“We have seen cases where people’s health has declined because of the conditions they live in. This scheme is a win-win for all involved.
“For the lender the scheme is risk free because the improvements will only add to the value, for the broker the scheme provides the opportunity to receive a fee for cases that would have traditionally been discarded and, most importantly, for the homeowner who will be able to improve their home whilst retaining ownership.
“With any profits being reinvested back into the scheme we hope to be able to help support many more vulnerable homeowners to live in the home they deserve.”
Martin Leach, chief executive of the Housing Action Charitable Trust, praised the scheme.
He said: “The Home Improvement Services offered by London Rebuilding Society are a real solution for homeowners who often have nowhere else to turn.
“Demand for schemes like these will only continue to increase as the housing and social care crises continue to grow.”
A nationwide launch of The Home Improvement Scheme is planned for November this year.
Aaron Conlon, head of operations at more 2 life, said: “We are focused on innovation in the equity release market and this scheme helps grow the number of customers who can benefit from accessing the wealth in their home.
“The test in London and the South East will enable more 2 life to learn more about how the scheme works in action and help us to extend our approach to equity release innovation.”