estate agency services
Help To Buy (Scotland) Scheme
The Help to Buy (Scotland) Scheme is a scheme designed to help first time buyers and home owners alike to buy a new-build home with a deposit of as little as 5%. Under the scheme, the Scottish Government will help you fund your purchase on a shared equity basis. There are of course conditions which apply and we hope that the following information provides you with a general insight into how the scheme could work for you.
Who can apply?
The scheme is open to all first time buyers and existing home owners seeking to buy a new home from a participating house builder
Can I take out a mortgage from a lender of my choice?
No – only with a lender who has signed up to the scheme
Are self-build homes covered?
No. The scheme is not to assist with self-build projects.
Is there a minimum mortgage that must be taken out with a participating lender?
Yes – the mortgage must be for a minimum of 25%.
Does a buyer have to put down a deposit?
Yes. A lender will normally expect a minimum of 5%.
When must the Scottish Government’s Equity Share be paid back?
There is no deadline. A buyer can decide to acquire all or some of the retained equity stake at a time of his or her own choosing. Alternatively, the stake will be repaid upon the occurrence of certain events, the most common one being when the property is sold.
Are all builders registered under the Scheme?
No. A list of builders registered for the scheme can be viewed on www.scotland.gov.uk/htb
Can I buy an incomplete property?
Applications should be submitted no more than nine months prior to the anticipated legal completion date.
Does the scheme apply to second homes and buy to let houses?
No. The property must be a buyer’s only residence and they must not own another house.
Does a buyer have to live in Scotland to participate?
Non UK nationals are eligible so long as they have a right to permanent residency in the UK and meet any other eligibility criteria set for the scheme.
How is the purchase funded?
The majority share in the property must be provided by way of a mortgage from a qualifying lending institution a minimum of 80% of the full purchase price. A buyer will need to provide and deposit and this, together with the mortgage, must over a combined minimum of 80% of the total price. The mortgage must be on a repayment, not an interest only, basis.
What happens on a sale?
Unless a purchaser has elected to repay the equity stake early, the assistance must be repaid from the sale proceeds, e.g. if a buyer has an 85% stake then they will get 85% of the selling price on a sale; the Scottish Government will receive 15%.
Buyers can increase their equity share by a minimum of 5% in any one year. The buyer must meet all valuation costs and other expenses.
How do I apply?
The following agent administers the scheme for people in Argyll & Bute. They will assess your application to determine if you are eligible to participate in the scheme.
Argyll Community Housing Association Limited. 63-65 Chalmers Street, Ardrishaig, Argyll, PA30 8DX. Phone: 01546 605855
What else do I need to know?
You should seek independent financial and legal advice before agreement to take part in the scheme.
Our legal experts can advise you on the terms of all of the documentation in relation to the scheme and will ensure that you are satisfied with those terms before you enter into any legally binding agreement.
The shared equity arrangements will include the granting of a mortgage (or ‘standard security’ as it is known in Scotland) to secure the rights of the Scottish Government. Our legal team will discuss your specific needs and requirements with you and will offer advice and assistance in dealing with any queries you might have in relation to the scheme and how it could affect your future plans for the property.