The First Home Fund Scotland is a shared equity scheme to support first time buyers buy a home that meets their requirements. The First Home Fund is available to first buyers in Scotland and will allow them to get onto the property ladder, the scheme will provide applicants with up to £25,000 to go towards the purchase of a property and can be used on both existing properties and new builds. As well as the £25,000 loan, 49% of the purchase price, whatever is lower, can also be used towards the purchase of both existing property and new build homes in Scotland.
How Does It Work?
If you are a first time buyer who is looking to purchase their first home and take our mortgage, you are able to apply for a equity loan worth up to £25,000, the mortgage must be a capital repayment and be at least 25% of the purchase price, you can’t use the scheme on buy to let properties.
If you are looking to purchase a property that costs more, the support that you receive from The First Home Fund will be based on the actual value of the property you are going to buy, not the price that you have paid should you be going to pay more than the market value. Should you be applying for The First Home Fund scheme and one of the joint applicants has owned a property before, you are still allowed to apply for the fund.
Am I Eligible?
The First Home Fund is available to all first time buyers in Scotland and can also be used for purchases on both brand new builds and existing properties. However you will still need to put down a minimum of 5% deposit in order to be eligible for the The First Home Fund, you will also need to take out a minimum mortgage of around £25,000, this needs to be a capital and interest repayment mortgage. While the scheme isn’t available for cash buyers or for buy-to-let properties where the property won’t be the buyer’s sole residence of applications to the scheme.
How Do I Apply?
The First Home Fund will open up at 9am on the 1st April for applications that will need to be completed in the financial year of 2021-2022, and this budget will be available up to £60 million. The fund will close for new applications when the funding for 2021-2022 has been used up, there will be no notice informing people of the closure and any applications that have been received after the budget has been used will not be processed.
What Happens Next?
Once your application has been successful, your solicitor will have received an award letter which states you can proceed, you must ensure that your missives are completed within three months of the date on the award letter. After this you will need to complete the property purchase within six months of the concluded missives date. The dates and timescales will be especially important if you are purchasing a new build home where the build may be delayed.