The First Home Fund has re-opened
Post Author:
Rona Burns
Date Posted:
April 1, 2021
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The Scottish Government has re-opened the First Home Fund on 1 April 2021. This initiative, which was originally launched in December 2019, aims to assist first time buyers to enter the housing market. The scheme will provide up to £25,000 per applicant and is a shared equity arrangement: the Scottish Government contribution to the purchase price is secured against the property.
The total value of the fund is £60 million for 2021-22. The fund will close when this budget has been exhausted.
Who is eligible?
The scheme is open to first time buyers in Scotland who are purchasing a property for use as their main residence. The funding may be used towards the purchase of a new build or an existing property, subject to approval.
The purchaser must take out a minimum mortgage of 25% of the purchase price, with a deposit of at least 5%. There is a limit of one application per property.
How much will be funded?
The Scottish Government will fund up to 49% of the property purchase price or valuation, whichever is the lower, up to a maximum of £25,000.
How is the funding repaid?
The funding is repayable to the Scottish Government when the property is sold. The amount repayable is calculated in accordance with the percentage of the valuation funded when the property was purchased. If the property has increased in value, the amount repayable will be greater than the amount originally funded; conversely, if the property has fallen in value the amount repayable will be less than the amount originally funded.
Purchasers may also repay some or all of the funding during their period of ownership subject to certain conditions.
How do I apply?
The scheme is administered by Link Housing on behalf of the Scottish Government. Full details of the scheme and the application process are available at their website:
https://linkhousing.org.uk/firsthomefund
Assistance may also be obtained from participating Independent Financial Advisers, lenders, housebuilders and solicitors.
The information in this blog provides only an overview of Scottish Government guidance and legislation in force at the date of publication and no action should be taken without consulting the detailed Scottish Government guidance and legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this blog can be accepted by the firm.
