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What is shared Equity?

What is shared Equity?

Buying through a shared equity scheme means you split the cost of purchasing your property with the Scottish government.

For example, if your deposit and mortgage pay 90% of your property value then the Scottish government will hold a 10% share. This means when you sell you will receive 90% of the final sale price and the Scottish government will receive the remaining 10%. You still have full ownership rights and title to the property.

How does Help to Buy (Scotland) Work and conditions of the scheme?

How does Help to Buy (Scotland) Work and conditions of the scheme?

  • You could purchase a new home with a 5% deposit.
  • Help to Buy simply means people can purchase a new build property without the need for a large deposit
  • The Scheme is open to the Help to Buy affordable new build scheme
  • The threshold price for Help to Buy is £200,000
  • The scheme is available to help first-time buyers and existing homeowners
  • Applications for help to buy cannot be submitted more than nine months before the expected completion date.
  • The equity is interest-free.
  • Buyers should only submit a full mortgage application after an authority to proceed letter has been issued by the agent administrating the scheme.
  • You must take out at least a 25% mortgage.
  • A single person will not be eligible if he or she requires a mortgage of more than 4.5 times income or couples 3.5 times joint income.
  • Must be your only property
  • A mortgage lender is likely to require a deposit of around 5% and the mortgage and deposit must cover a combined minimum of 85% of the total home's purchase price.
  • Buyers cannot use interest-only mortgages and the maximum is 15% of the purchase price.
  • Guidelines advise that monthly costs are no more than 45% of your net disposable income.
Applications aged 60 and over

Applications aged 60 and over

Can apply to the scheme without the requirement for a mortgage. Mortgages of less than 25% will be permitted for this group. These applicants must demonstrate a housing need to move.

Under Occupations - living in property to large

The property no longer suits there needs. Cant manage stairs etc.

Support - need to be closer to family or friends that can provide care.

Repayments of Equity Share

  • There is no set deadline.
  • Purchasers can decide to acquire all or some of the Scottish Government Equity Share.
  • The Equity Share must be repaid on the sale of a home.
  • Decisions are made on a case by case basis if you wish to borrow more money on your property at a later date.

I Would like more information on the Scottish Governments Help to Buy Scheme