£20m loan secures future developments
The terms of the Lloyds loan allow us to draw capital when we need to buy land, or pay our new build contractors. The loan flexibility allows us to pay down some of our borrowings when we have cash surpluses, e.g. following shared ownership property sales, or gift-aid receipts from Horizon Homes.
In terms of value for money, our new Lloyds agreement comes with an enviable loan margin cost (i.e. the fee a borrower pays above the market interest rate).
This is just 0.9% and it compares favourably with typical loan margin rates of 1.15% to 1.25% for this type of borrowing in the social housing sector. This generates a saving of £50,000 pa.
The Lloyds loan follows our recently agreed RBS funding- also for £20m. Our new RBS loan refinanced a completed borrowing facility. Although this did not provide us with new capital, it has improved our value for money by being £180,000 pa cheaper than the loan it replaced.
Westward’s new Lloyds Bank loan will enable us to build over 190 much needed new homes in Devon and Cornwall.