What options are available?

Shared equity schemes typically require you to contribute a minimum deposit of 5% and the shared equity scheme will make up the rest of your deposit. This means that buyers are often able to afford a more expensive property that they first ever thought possible. 

​

The three most common shared equity schemes used in Scotland are the First Home Fund, the LIFT Scheme and Help to Buy (the Help to Buy Scheme is different from the Help to Buy ISA). Normally during the lifetime of the equity share you will not have to pay any monthly interest or repayments to the Scottish Government for their equity contribution. The equity share will be repaid upon the future sale of the property. 

​

​

​

The First Home Fund - (Fully Committed for 2021/2022, applications currently closed)

​

The First Home Fund is a £50 million shared equity pilot scheme to provide first-time buyers with up to £25,000 to help buy their first home. This is open to all first-time buyers in Scotland and can be used to help buy both new build and existing properties.

​

In order to take part in the scheme, you will be required to provide a minimum deposit of 5%  and your mortgage must be at least 25% of the purchase price. However please note that this is subject to individual lender requirements, and any amount over valuation must be cash funded.

 

Although the Scottish Government will have an equity share in the property, you will be the legal owner of the property. Additionally you can increase your equity share to 100% over time if you choose to do so. There are no monthly payments to be made towards the Scottish Government and no interest will be charged.

 

The First Home Fund budget for 2021-2022 is now fully committed and applications are currently closed.
 

​

​

The LIFT Scheme - (applications are currently closed) 

​

The LIFT (Low-cost Initiative for First-Time Buyers) Open Market Shared Equity (OMSE) scheme has helped over 13,000 people buy a home since 2005. Applicants can receive up to 40% of funding towards the price of a home on the open market.

​

The Scottish Government contributes between 10% and 40% towards the price of a home you have chosen on the open market. For example, if you find a home for £100,000 and can afford to contribute £70,000 (through mortgage and deposit) as your share, the Scottish Government could provide the remaining 30% (£30,000). When the property is sold, 30% of the sale price would be returned to the Scottish Government. In most areas you can increase your equity share to 100% over time if you choose to do so. 

​

The Scottish Government’s contribution depends on the amount of mortgage funds available to you. Property size and price restrictions do apply, this also varies between local authority areas in Scotland. There are no monthly payments to be made towards the Scottish Government and no interest will be charged.
 

​​

​

Help to Buy (Scotland) - (applications are currently closed)

​

​The Help to Buy (Scotland) schemes are currently closed

​

Information from previous years Help to Buy (Scotland) scheme: 

​

If you want to buy a new build home using the Help to Buy scheme, the property purchase price cannot be more than the threshold price. The threshold price is £200,000 for the financial year 2020-21. 

​

You will be expected to pay a minimum of at least 85% of the home's total purchase price and the Scottish Government will hold the remaining percentage share of 15% under a shared equity agreement. You can increase your equity share to 100% over time if you choose to do so.

​

You need to take a mortgage of at least 25% of the purchase price. You must be unable to buy the property without the scheme otherwise you will not be eligible for the scheme. There are no monthly payments to be made towards the Scottish Government and no interest will be charged.

​

​

​

Get in touch to explore your shared equity options with our expert advisors: info@mortgagenest.co.uk

​

​

​