Social Landlords (Permissible Additional Purposes or Objects) Order 1996

JurisdictionUK Non-devolved
CitationSI 1996/2256

1996 No. 2256

HOUSING, ENGLAND AND WALES

The Social Landlords (Permissible Additional Purposes or Objects) Order 1996

Made 6th September 1996

Laid before Parliament 10th September 1996

Coming into force 1st October 1996

The Secretary of State for the Environment, as respects England, and the Secretary of State for Wales, as respects Wales, in exercise of the powers conferred upon them by section 2(7) and (8) of the Housing Act 19961, and of all other powers enabling them in that behalf, hereby make the following Order:—

S-1 Citation and commencement

Citation and commencement

1. This Order may be cited as the Social Landlords (Permissible Additional Purposes or Objects) Order 1996 and shall come into force on 1st October 1996.

S-2 Interpretation

Interpretation

2. In this Order, unless the context otherwise requires—

“assured percentage arrangements” means arrangements pursuant to which—

(a) a social landlord provides a sum (the “initial capital sum”) to a person who, at the time when the landlord offers to provide that sum, is a resident of theirs (the “participating resident”) for the purpose of enabling or assisting him to acquire a legal estate in a house;

(b) the participating resident, in consideration for the provision of the initial capital sum, enters into an assured percentage covenant with the landlord; and

(c) the liability to make any payment required by the assured percentage covenant is secured by a mortgage;

“assured percentage covenant” means a covenant requiring the participating resident in the case of the assured percentage arrangements in question to make to the landlord at a date (the “discharge date”) determined in accordance with the covenant a payment (the “discharge payment”) calculated by reference to the product of—

(a) the difference between—

(i) the initial capital sum, expressed as a percentage of the initial value of the house, and

(ii) the aggregate of the interim payment percentages (if any), and

(b) the final value of the house;

“bank” means—

(a) an institution authorised under the Banking Act 19872; or

(b) a European authorised institution within the meaning of the Banking Co-ordination (Second Council Directive) Regulations 19923where the requirements of paragraph 1 of Schedule 2 to those Regulations have been complied with in relation to that institution’s establishment of a branch;

“equity percentage arrangements” means arrangements pursuant to which—

(a) a social landlord conveys a legal estate in a house to an individual (the “relevant purchaser”);

(b) the relevant purchaser, in consideration for that conveyance—

(i) makes to the landlord a payment (the “initial payment”) expressed to represent a percentage of the initial value of the house; and

(ii) enters into an equity percentage covenant with the landlord; and

(c) the liability to make any payment required by the equity percentage covenant is secured by a mortgage;

“equity percentage covenant” means a covenant requiring the relevant purchaser in the case of the equity percentage arrangements in question to make to the landlord at a date (the “discharge date”) determined in accordance with the covenant a capital payment (the “discharge payment”) determined by reference to that percentage (if any) of the final value of the house which remains after reducing 100 per cent. by the sum of the following percentages, that is to say—

(a) the percentage of the initial value of the house which the initial payment made pursuant to the equity percentage arrangements in question was expressed to represent, and

(b) the aggregate of the...

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