Keswick Community Housing Trust: Refinancing to save money

Keswick Community Housing Trust (KCHT) took on debt from other social funders to provide 41 affordable homes. It’s now refinanced that debt with Charity Bank.

Social Problem 

In June 2023 the Bank of England’s base rate moved to 5%, three years prior, it was just 0.1%. The increase means that many borrowers are now spending considerably more on their loan repayments.  

Organisation 

The average house in Keswick is priced at £527,357 – more than £200,000 above the UK national average. The high prices are due in part to the demand for holiday properties and second homes. Benita Lapthorn, Company Secretary at Keswick Community Housing Trust, shares, “Over 10 years, we’ve seen an extra 280 properties change from being main homes to holiday lets or second homes. People who were born and bred here, but who don’t qualify for social housing, are having to move away from their friends and family because they can’t afford to buy or rent in Keswick. Keswick Community Housing Trust was set up to address that problem.” 

KCHT has built 41 new homes across four developments. One was sold outright, 15 were sold on a 50% shared ownership basis, but most are let out at below market rent. All the properties have local occupancy clauses.  

Loan 

KCHT developed its properties with the help of loan finance from another loan providers. Rates were tied to the Bank of England base rate, so as Bank base rate rose, the trust’s loan repayments increased significantly. Benita shares, “Our repayments had increased by about 35%. If we hadn’t received improved margins from our existing lenders, they’d have increased by 47% by now.” 

Thankfully, Charity Bank was able to offer KCHT a competitive rate, so the housing trust refinanced £600,000 of its debt. Benita says, “It was easier than getting previous loans. With Charity Bank, it felt like more of a conversation. There was a lot of back and forth while we decided exactly how much we wanted to borrow, agreed some changes to early repayment terms and which development to use as security, but Denise and the rest of the Charity Bank team were fabulous. They were pragmatic and open to compromise.” 

Impact  

Now that KCHT has more favourable loan terms, it can focus on the trust’s long-term future, including building more affordable homes for the people of Keswick.  

“Charity Bank really understands community land trusts and how they work. They understand that volunteer-led organisations aren’t like normal businesses, and they’re prepared to be flexible and to compromise.” 

Benita Lapthorn, Company Secretary at Keswick Community Housing Trust 

“Between 2021 and 2024 we lived in 4 different homes. Being required to move so frequently was very challenging for us as we had a teenage daughter and our son arrived in early 2022.” 

Thank you is not enough to convey the feeling of gratitude we have to KCHT for granting us a secure home and for taking away our worry about getting a notice to leave.  We are making our next chapter of life in this beautiful house on Calvert Way, a home full of love and happiness and we are forever grateful for this opportunity that has been granted to us.” 

Ed and Sarah, tenants