Consulting you on major works

Paying for major works (service charges)

Kingston Council recognises that some lessees may find the cost of some works difficult to pay for, although we must maintain the building in accordance with the lease and for the benefit of all residents.

Repayment options are as follows:

A) Resident leaseholders

If you are a resident leaseholder you can pay for major works which cost more than £1500 in several ways:

• Lump sum payment: You can pay for the full amount in one go and receive a discount of 5% if you pay on demand (one lump sum payment), or
• Instalment facilities: If you are resident in the flat you can opt to pay for them over a period of up to seven years (10 years for works carried out under the Council’s Better Homes Programme). The first three years are interest free.

These are deferred payment options and are not secured to the flat by a mortgage. 

• if you are on a low income, or on Income Support, the Benefits Agency on 020 8481 3000 may be able to help you or access www.direct.gov.uk.
• you may be able to add the amount to your mortgage
• you may be able to get a loan from a bank or building society.

Service charge (major works) loan

If you bought your flat under the Right to Buy Scheme, you may be eligible for a loan under the Housing (Service Charge Loans) Regulations 1992, in respect of the cost of repairs. This is often simply referred to as a Right to Buy Loan.

You may borrow the amount by which the service charge exceeds £1,500 subject to a minimum amount in excess of £500 and a maximum of £20,000. The repayment period depends on the amount borrowed. You would be required to pay interest for the loan at the Local Authority mortgage interest rate. Such a loan would also be secured by a mortgage on the flat.

Your request for a loan must be made within six weeks of the date you are invoiced for the works in question.

If you have any queries regarding payment options please contact the Income Recovery Team on 020 8547 5468.

B) Non-resident leaseholders

Non-resident leaseholders are required to pay for major repairs in accordance with the terms of the lease which is payment in full on invoice. There is no discount available to leaseholders for prompt payment.

However from 1 April 2015 the Council have introduced a scheme enabling non-resident leaseholders to repay major works or Better Homes invoices over £1,500 over three years subject to interest being payable on the debt. Interest will be charged at five per cent above the Bank of England Base rate on the amount owed.

The Council are also considering whether it will be able to offer payments in instalments from receipt of the estimate. If this option can be offered, further details will be provided when we consult with leaseholders on the estimated charge for major works.

Non-resident leaseholders who rent their homes to Council nominated tenants through our Private Sector Leasing scheme or Tenant Finder service can continue to benefit from a five per cent discount on prompt payment in full or interest free payments over three years.