Help to Buy (Scotland) closed to new applications on 5 February 2021.
What is Help to Buy (Scotland)?
The Help to Buy (Scotland): Affordable New Build Scheme, to give it its full name, offered interest-free equity loans of up to 15% of the value of a new-build home.
The scheme was due to run until March 2022, but instead closed to new applications on 5 February 2021 due to budgetary constraints. Existing applications are still being processed.
Repaying a Help to Buy (Scotland) loan
If you bought a home using Help to Buy (Scotland), there's no set deadline to pay off your equity loan.
While you're paying it off, however, you will be limited in what you can do with your property.
There are strict rules about improving or extending homes bought using Help to Buy (Scotland), so if you wish to carry out any work you'll need to receive written permission.
The government is generally reluctant to allow changes that will increase the value of the property, so there's a good chance your request will be denied.
Can I increase my share?
You can increase your share of your home by buying up chunks of the government's stake. This process is often referred to as 'tranching up'.
You don't have to tranche up but if you do want to, you'll have to buy at least 5% back in a year. Bear in mind that you'll be buying the equity at market rate, so you'll need to have a valuation done before purchasing.
The Scottish government's First Home Fund was launched in December 2019.
It offers first-time buyers interest-free equity loans of up to £25,000 to help them get on to the property ladder.
To qualify, you'll need to have a 5% deposit. There's no upper price limit for homes bought using the scheme, and both new-build and existing properties qualify.
When you apply, the government will work out how much equity the loan covers. So if the property's market value is £125,000 and you apply for a £25,000 loan, the loan will represent 20% of the property's value.
When you come to sell, you'll then need to pay back 20% of the total proceeds, regardless of whether you sell at a profit or a loss.
Check out the Scottish government's guide for full details, including which lenders offer mortgages under the scheme.
The Low-cost Initiative for First Time Buyers (LIFT) scheme is split into two parts.
The Open Market Shared Equity scheme (OMSE) allows first-time buyers to purchase a stake of between 60% and 90% of a property for sale on the open market with a modest deposit.
The New Supply Shared Equity scheme (NSSE) works in a similar way, although it's limited to new homes and buyers will usually purchase a stake of between 60% and 80%.
Priority for both schemes is usually given to social renters, members of the armed forces and disabled people.
If you're interested in buying a home using NSSE, you can search for a project in your area on the Scottish government website.