First Home Fund

What is First Home Fund?

The First Home Fund is a £150 million shared equity initiative from the Scottish government set out to provide first-time buyers with up to £25,000 so that they may purchase a property. The scheme is available until March 2021.

Who can qualify for the First Home Fund?

The fund is open to all first-time buyers in Scotland and can be used to help both new build properties and existing properties.

What are the criteria for the First Home Fund?

You must provide a minimum deposit of 5%
Your mortgage must be at least 25% of the purchase price
The scheme is subject to individual lenders requirements
The Scottish government will have an equity share in the property
There is no price cap on properties
Gifted deposits are allowed
You will own the property outright
There is no monthly payments or interest charged paid to the Scottish government on their equity share
You will have to repay the Scottish government their percentage equity share on any increase in value on your property when you sell your home
You do have the option to pay off the equity share before you sell

What restrictions do you have with the Scottish Home Fund?

The maximum contribution from the Scottish government is £25,000 or 49% of the property valuation figure or the purchase price whatever is lower
There is a limit of one application per property
You can submit an application but you will be limited to one award
The initiative is not available for buy to lets
You cannot apply to other Scottish government shared equity schemes or have an open application
You can't use the Scottish Home Fund to cover your legal costs or LBTT
Once your offer has been accepted on your property you can complete the application form which normally takes 5 days
McEwan Fraser Legal can help you complete the application form and you must submit your application before legal missives have been concluded
If you apply for a joint mortgage only one applicant needs to be a first-time buyer
The administering agent for the scheme is Link Housing and will assess whether you can meet the monthly mortgage payments
The award letter is valid for 3 months and the settlement of the purchase must be completed within 6 months from the date you conclude missives
It is a criminal offence to knowingly provide incorrect information
Builders Part Exchange properties are not allowed

What does it cost to apply for the Scottish Home Fund application?

A fee of £550 will be charged by the scheme administrator if your application fails the fee will be refunded.

You can pay above the valuation figure for a property but the Scottish government equity stake will always be calculated at the valuation figure.

You will be responsible for all costs with the property such as insurance, tax, repair costs, maintenance etc.

Can I increase my equity stake in the property?

You can only increase your equity by at least 5%.

If your equity share is 90% or higher any further increases must be to 100%

You must get an independent property valuation from a property surveyor on the Scottish governments' panel and is valid for 3 months if you want to increase your equity in the property.