We carry out major works in order to maintain and improve our housing stock.

When we carry out major refurbishment, the following works are usually included:

  • decorations to shared areas
  • roofs, windows, brickwork and other replacements we've assessed as necessary
  • district heating, lifts and water tanks (these works have their own separate programmes).

Sections in this guide (click title to view)

1. Section 20 consultations (notices)

Stage 1 - Notice of intention

We write to each leaseholder and residents tenants association (if one exists) who may be affected by the contract with:

  • a description of the proposed works and why we think they are necessary
  • an invite to nominate a contractor from whom we should obtain a quote (where a contract is to be advertised in the European Union, homeowners are not able to nominate a contractor)
  • an offer to allow homeowners 30 days to send us their observations in writing.

Stage 2 - Landlord’s proposal

We write to each leaseholder and tenants association who may be affected by the contract and provide:

  • details of the proposed contract. For contracts advertised within the European Union only one proposal is required. For all other contracts we must provide at least two estimates
  • if possible, the estimated contribution payable by homeowners. Otherwise the reasons why this information cannot be provided at this stage. When this information is available we must provide it to homeowners within 21 days
  • a summary of the observations we received (if any) at Stage 1 and our responses to them
  • 30 days for homeowners to send us written observations about the estimates.

Where a contract has not been advertised in the European Union, we must send a further consultation notice to homeowners.

Stage 3 - Award of contract

If the contract is not awarded to the contractor who provided the lowest estimate, or a contractor who was nominated by homeowners, we write to each leaseholder and tenants association who may be affected by the contract and tell them why we have awarded the contract.

We also provide a summary of the observations we received (if any) at Stage 2 along with our responses to them. Throughout the consultation process we will give consideration to the observations raised by homeowners.

Watch the video below for more information on Section 20 notices.

2. Major works calculations

Each property has a rateable value (RV) based on its size and location. Estate rateable values (ERV) are calculated by adding together the RVs for all the properties on the estate.

Similarly block rateable values (BRVs) are calculated by adding together the RVs for all the properties in the block.

We work out the cost for major works by using rateable values. We divide the cost of works to the estate by the ERV and multiply this by your property RV.

For example:

Total cost = £7,681.39 (A)
Block RV = 603 (B)
Property RV = 376 (C)
Property cost = £4,789.72 (D)

A divided by B, multiplied by C, equals D

3. Payment options for major works service charge invoices

We have a range of ways for you to pay your major works service charges. So you can choose the best option for you, the different ways to pay are explained below.

Option 1 - Prompt payment discount

If you are a resident leaseholder and the property is your main home this option offers a five per cent discount off the total cost of the major works service charge invoice.

You must settle 95 per cent of the invoiced sum by the end of the financial year in which you received your estimated major works service charge invoice.

To take advantage of the prompt payment discount, 95 per cent of the invoiced amount must be paid within six weeks of receiving the invoice or in 12 equal monthly instalments from April 2018 through to March 2019. This option is only available to resident leaseholders, where the property is their main home.

Upon receipt of 95 per cent of the invoiced sum we will apply the five per cent discount to the account.

How do I apply for this option?

You will need to download, fill in and return the prompt payment discount agreement form.

You can fill it in using Fill & Sign on Adobe Acrobat Reader DC. This allows you to add text to the PDF form and sign it with your signature.

If you’ve not used Fill & Sign before, have a look at the guide by Adobe. If you’re using an older version of Adobe Acrobat that doesn't have Fill & Sign, you can update to the latest version for free.

Option 2 - Interest free instalments over 12 instalments

You can pay over 12 equal monthly instalments, interest free if:

  • you are a resident leaseholder
  • the property is your main home
  • your major works service charge invoice sum is under £3000.

How do I apply for this option?

You will need to complete the standing order mandate instruction form sent with your major works service charge invoice. You must start making payment immediately.

Please note: If any service charge which is due remains unpaid for 14 days, we may apply interest at the rate of four per cent above the base rate.

Option 3 - Interest free instalments over 24 months

You can pay over 24equal monthly instalments, interest free if:

  • you are a resident leaseholder
  • the property is your main home
  • your major works service charge invoice sum is between £3001 - £7500
  • May be extended to 36 months in exceptional circumstances.

How do I apply for this option?

You will need to complete the standing order mandate instruction form sent with your major works service charge invoice. You must start making payment immediately.

Please note: If any service charge which is due remains unpaid for 14 days, we may apply interest at the rate of four per cent above the base rate.

Options 4- 5 Take out an interest free discretionary loan for 48-60 months, the length of time depending on the value of the loan.

Options 6 Take out an interest free discretionary loan for 60 months ( plus an additional 72 months incurring interest in accordance with your lease) for invoices over £20,001 and above.

Options 4, 5 & 6 - Discretionary loans ( Interest free & interest bearing)

We may agree to an interest free loan, if you agree to have a charge registered against your property. Options 4,5 & 6 offer leaseholders the opportunity to access loans from the Council in order to meet the costs of the major works service charge invoice.

There are three possible loan options. How long you have to repay the loan depends on the amount you need to borrow.

Option Loan amount Loan term
Option 4 £7,501 to £15,000 48 months to pay
Option 5 £15,001 and £20,000 60 months to pay
Option 6 £20,001 and above 60 months to pay with an additional 72 months available (interest bearing)

Please note: The interest rate payable on option 6 will be fixed at 4% above the Councils Banker's variable base rate. The Councils interest rate will be fixed as at the date you take out the loan and will remain fixed at the same rate for the life of the loan. However the Bank of England rate may vary thus the interest charge will change in line with the changes

How do I apply for this option?

You will need to request a service charge loan application form from us, fill it in and send it back with a copy of a letter from your bank or building society refusing you a loan.

We strongly recommend that you always get independent financial advice and talk to your mortgage provider (if you have one) before you sign any financial agreement.

Option 7 - Deferred payment with a charge on your property

We may agree to defer payment if a charge is put against your property. This option is available primarily for those households where the leaseholder is over 60, disabled or can show that there is insufficient income coming into the household in order to meet the costs of the major works service charge invoice.

Option 7 means that you do not have to make payments towards the major works invoice. The debt will ultimately be repaid when the property is sold or assigned ( e.g. remortgage, transfer of equity).

Please note: The interest rate payable on option 7 will be fixed at 4% above the Councils Banker's variable base rate. The Councils interest rate will be fixed as at the date you take out the loan and will remain fixed at the same rate for the life of the loan. However the Bank of England rate may vary thus the interest charge will change in line with the changes

There is a standard administration fee of £452 ( correct at April 2017) on loans of any length /amount. There is also an administration fee to redeem the loan of £200.

How do I apply for this option?

You will need to:

  • request a deferred payment application form
  • provide us with a copy of the letter from your bank or building society refusing you a loan.

We strongly recommend that you always get independent financial advice and talk to your mortgage provider (if you have one) before you sign any financial agreement.

Contact us

We are making every effort to help you with your major works service charge invoice. For more information on any of the major works payment options, please contact us directly on 020 7926 7132 or email HMhomeownership@lambeth.gov.uk

4. Help for leaseholders

If you are having problems paying your service charges, we may be able to assist with making a suitable payment arrangement.

You can contact your collections officers using the details shown on your invoice or contact the Home Ownership Service on 0207 926 7132 or email at HMHomeownership@lambeth.gov.uk.

5. Ask about your major works service charge

If you think your service charge bill is wrong, you can tell us what you think is wrong and ask us to check your charges.

Leaseholder disputes can also be taken to the First Tier Tribuanal - GOV.UK.

6. Submit an observation

When we serve you with a section 20 consultation notice, you're able to submit a written observation regarding the works or the costs.