Local Government Act 1974

37 Extension of power of local authorities to make advances

(1) Section 43 of the [1958 c. 42.] Housing (Financial Provisions) Act 1958 (power of local authorities to make advances for certain housing purposes) shall be amended in accordance with the provisions of this section.

(2) At the end of paragraph (d) of subsection (1) there shall be added the words “or

(e) subject to subsection (2A) below, facilitating the repayment by means of the advance of the amount outstanding on a previous loan made for any of the purposes specified in paragraphs (a) to (d) above”.

(3) After subsection (2) there shall be inserted the following subsection:—

“(2A) An advance shall not be made for the purpose specified in paragraph (e) of subsection (1) above unless the local authority or county council satisfy themselves that the primary effect of the advance will be to meet the housing needs of the applicant by enabling him either to retain an interest in the house concerned or to carry out such works in relation to that house as would be eligible for an advance by virtue of paragraph (c) or paragraph (d) of that subsection.”

(4) In paragraph (c) of subsection (3) of the section for the words " may provide for repayment being made either by instalments of principal or by an annuity of principal and interest combined " there shall be substituted the words “shall provide for repayment of the principal—

(i) by instalments (of equal or unequal amounts) beginning either on the date of the advance or at a later date, or

(ii) at the end of a fixed period (with or without a provision allowing the local authority or county council to extend that period) or on the happening of a specified event before the end of that period,

and for the payment of instalments of interest throughout the period beginning on the date of the advance and ending when the whole of the principal is repaid”.

(5) At the end of the section there shall be added the following subsection:—

“(5) If it appears to a local authority or county council that the principal effect of the making of an advance under subsection (1) above in respect of any premises would be to meet the housing needs of the applicant, they may make the advance notwithstanding that it is intended that some part of the premises will be used or, as the case may be, will continue to be used, otherwise than as a dwelling ; and accordingly where, by virtue of this subsection, a local authority or county council propose to make an advance in respect of any premises, the premises shall be treated for the purposes of subsections (1) to (4) above as, or as a building to be converted into, a house or houses”.

(6) On the coming into operation of this section, no further advances shall be made by local authorities in England and Wales under section 74 of the [1969 c. 33.] Housing Act 1969 or section 41 of the [1973 c. 26.] Land Compensation Act 1973.