Subject to contract and credit comittee approval
The Housing Finance Corporation Limited

Loan Amount
Minimum loan amount of £1,000,000 and multiples of £500,000

Borrower
Registered Social Landlords

Lender
The Housing Finance Corporation Limited ("THFC")

Purpose
To finance the purchase acquisition development repair or improvement of property to be used for housing or the refinancing of existing loans for such purpose.

Availability
By way of a loan for 10 years on an index linked basis ("The Initial Interest Basis") followed by (Subject to availability) further index linked or fixed rate periods of 5, 10 or 15 years or such other period as may be agreed by THFC ("Subsequent Interest Basis").

Term
25 years

Drawdown Period
Loans to be drawn down in one amount at a time to be agreed between THFC and the Borrower but in any event no later than 31st December 2002

Repayment
Either in one amount at the end of the term of any fixed advance period or by way of an amortisation schedule agreed between THFC and the Borrower

Prepayment and Cancellation
Prepayment in full but not part permitted without penalty at the end of the term of any advance (subject to a minimum amount of £1,000,000 and multiples of £500,000). Index Linked Advances or Fixed Rate Advances repaid before the end of the term of the relevant advance will be subject to breakage costs.

Interest Periods
Semi-annually up to (and including) the date the loan is repaid in full. Interest payments to be made one month before the Interest Period Dates

Payment Amounts
Payments will be calculated in accordance with the following formula:

Where:

t - means, in respect of an Interest Period, the number of calendar years (rounded down to the nearest whole year) from (and including) the Fixed Rate Start Date(t=1) to (and including) the relevant Interest Period Date.

RPIbase - means, in respect of a Payment Date, the level of the RPI (as defined below) as fixed at the Start Date.

RPIt-1 - means, in respect of a Payment Date, the level of the RPI for the month immediately preceding the month in which such Payment Date falls.

SwapRate - means, in respect of a Loan, the relevant swap rate for that Loan.

FixedRate - means, in respect of an Interest Period the Fixed Rate per annum as set at the Fixed Rate Start Date.

Arrangement fee
0.45% of the Loan amount payable on signing of loan documentation

Annual administration fee
0.05% payable annually in arrears increasing in line with inflation

Security
Standard THFC security requirements. (Detailed briefing note available on request)

Legal Costs
For the account of the Borrower