PLEASE NOTE: LSAP has been superseded, please go to - Forces Help to Buy Scheme (FHTB)
Sick of forces accommodation? Itching to get on the property ladder? Would £8,500 help you own your own home?
Although many service personnel would love to own a house, service life often means that they are unable to do so. The MOD recognises this and has set up the Long Service Advance of Pay (LSAP) scheme to help address these financial issue.
Eligible personnel can receive an interest free loan of up to £8,500 which can be put towards the security of buying a house, perhaps as the deposit.
Buying a house is a complex process and you should always instruct a good solicitor to help you through. Buying as a member of the Armed Forces and using the LSAP can bring with it its own set of difficulties - you really need someone who is in the know! Solicitors in the Forces Law network are experts at dealing with matters related to the armed services and forces life.
For more information about buying a house with the Long Service Advance of pay, call the Forces Law helpdesk on 0845 601 1260.
Common questions about the Long Service Advance of Pay (LSAP)
Q. How much can I receive
A. Depending on your personal circumstance you can receive up to £8,500 or 182 days pay (whichever is the lower amount)
Q. How much interest will I have to pay?
A. Nothing, the loan is interest free
Q. How is the load paid back?
A. The loan is paid back over 10 years, normally at 10% per year. If you took a full £8,500 loan, this would work out around £75/month
Q. How do I know if I am eligible for an LSAP?
A. Applicants must:
- Have 4 years Service (Army & RAF) or on the trained strength of the Royal Navy or Royal Marines.
- Be currently serving with 3 months or more left to discharge.
- Medically fit.
- Not have given notice or applied for Premature Voluntary Release, unless the individual has qualified for a terminal grant which is greater than the LSAP and from which the loan can be repaid.
- Not have drawn any terminal benefits
- Not have been warned for discharge
Q. Can I buy any property?
A. No, the property to be purchased must:
- Be a residential property in UK, Channel Islands, Isle of Man or Republic of Ireland (for those recruited in the Republic or of Southern Irish parentage)
- Be mortgageable (even if no mortgage is needed)
- Be the only property to be owned by the applicant
- Not be a business property (even if it includes living accommodation)
- Not be a mobile home, a houseboat or a caravan
Q. What about tax?
A. A loan of more than £5000 will attract a tax liability because the Inland Revenue will regard it as a beneficial loan.
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