02 Feb 2021
First-time buyers will be able to access interest free loans of up to £25,000 towards their deposit from April 1st - but with limited funds, the scheme is expected to become oversubscribed quickly.
The Scottish government’s First Home Fund, which offers first-time buyers up to £25,000 for new build and existing properties, will continue in 2021/22 with a budget of £60million.
However, the funds are down 70% on the £200million pumped into the scheme last year, leading to fears that the pot of cash could run empty within weeks.
A further £40million has been allocated to the Open Market Shared Equity scheme, which sees the Scottish Government take an equity share in the homes of first-time buyers and other priority groups, including people aged over 60 and social renters.
It has been estimated by the Scottish government that this combined funding will assist more than 4,000 households to buy a home.
The First Home Fund is a Scottish Government scheme which provides first-time buyers with an interest-free loan of up to £25,000 to help them buy a property.
It is open to all first-time buyers in Scotland and can be used to help buy both new build and older properties.
Buyers are required to fund around 5% of the value of their new property from their own funds as a deposit.
The Scottish Government contribution is secured on the equity of the home, is repayable in full at any time, and must be repaid if the home is sold. No monthly payments apply.
Aberdein Considine's independent mortgage advisers can help you establish how much you can borrow and assist you with an application to the first home fund.
Applications are being accepted from April 1st, but the scheme is expected to see a high volume of applications. Therefore, it is advised to move now to get your application lined up for when the scheme launches.