Good News for Borrowers!

" Good news !!! From 1st February  there will be new rules to ensure that lenders advertise more accurate interest rates to customers who want to borrow money through loans or credit cards. One of the most important changes under the new Consumer Credit Directive is that lenders will now have display an interest rate – or annual percentage rate (APR) – that 51 per cent of customers are actually offered.

While this still does not guarantee that the advertised rate will be the one the customer is actually offered, it should be a better guide when sizing up the best available loans in the market."

Glen Oaks secures £14m funding package

Finance deal for housing association

Glen Oaks Housing Association has secured a s14 million funding deal which will help to refurbish 280 houses.

The cash has been sourced through a bond issue from The Housing Finance Corporation.

It is the first time this type of transaction has been used since the Scottish Government made it easier for housing providers to secure loans.

Glen Oaks, based in South Glasgow, intends to re-finance some of its existing loans and build 25 new homes within the next eight months.

It will also refurbish 280 homes in the Arden and Darnley areas.

Alasdair McKee, chief executive, said: "The s14 million deal will improve the quality of many of our tenants' homes.

"Glen Oaks is pleased to be the first housing association in Scotland to take advantage of the new rule which widens the borrowing opportunities available to us.

"It is a big story in housing terms in Scotland as it is the first time that a Scottish housing association has been able to obtain long term Bond finance since the law was changed. 

"It means Scottish housing associations can now give security on their property for more than 20 years for this type of funding. Being able to attract bond finance is appealing for associations just now as we have been able to obtain favourable terms."

Glen Oaks is a community controlled organisation which is run by a management committee of volunteers and owns 1,207 properties.

Mary Taylor, chief executive of the Scottish Federation of Housing Associations, said: "This innovative arrangement secured by Glen Oaks exemplifies the creative way in which housing associations and co-operatives in Scotland are working in order to secure investment to improve living conditions in their communities. 

"The SFHA congratulates Glen Oaks on being the first organisation in Scotland to secure bond finance under the new rules."

"We welcome the change in the law to allow housing associations such as Glen Oaks to borrow funds using bonds. Housing associations and co-operatives are an excellent investment opportunity for commercial lenders, offering safe and stable returns. We anticipate more deals like this in future."