Scotland’s Help to Buy scheme unable to meet demand

After just three months, the Help to Buy scheme in Scotland has used up all of its funding for the financial year.

In April, there was enough money in the scheme to enable 2,000 mortgage deals to go ahead but, by the beginning of July, funds for only 600 remained. The Scottish government had already provided an extra £50 million in funds for the scheme, describing demand as “extremely high”.

The scheme aims to help people to purchase new-build homes with deposits of around five percent. Each mortgage plus deposit must equal around 80 percent of the property value, and the Scottish Government then adds the remaining 20 percent in the form of an interest-free loan.

A government representative said that all Help to Buy applications that had already been approved would go through and home buyers who had not had applications approved were advised to check whether they might be eligible for funding from a sum of £100 million that will become available in April 2015, although this is also likely to run out quickly.

Many home buyers may have been assuming they would be able to obtain help from the scheme and, if they have been proceeding with that in mind, numerous house sales could now fall through. Scottish home builders could also find it harder to sell their new properties.

Some people are realising that the current upheaval in the mortgage market is creating a demand for qualified advisers, and many of them are pursuing new careers after undertaking CeMAP training in Scotland.



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