Help to Buy Scotland

FlyingCat

Currently having a nightmare with the Help to Buy Scheme (Scotland) and wondering if anyone else is in the same position?

We reserved our new build house on 4th July and submitted our HTB application on 9th July.

The news broke on 18th July that the scheme was running out of money. Our application was put on hold (all after 4th July were put on hold), on 22nd July we were told all applications received before 5pm on Friday 18th July would be processed.

I asked on the phone and was told as long as we meet the standard criteria (we do) then we would be accepted, there was no limited pot of money for our applications I was told. Also received an email saying the application would be processed against the scheme criteria.

Called yesterday for an update and was told they had only processed up to the 8th July, so mine would be looked at the next day, this was a lie as my mortgage broker called me afterwards and said the application had been rejected 2 hours earlier! The reason was that they are now judging if people could afford the purchase themselves (based on 3.5 times salary and 10% deposit).

Mortgage broker is currently appealing as we don't have 10% deposit and we are due to complete in 6 weeks or so!

Anyone else in a similar position? Or been told different? Really annoyed at being lied to more than once. Buying our ideal home is turning into a total nightmare!

Fox137

Sorry to hear the hassle your having. Not in a similar position but my partner put in an offer on a flat last week and the sellers had to pull out as their HTB was declined. He has now put a deposit on a new build flat but the mortgage is proving to be an issue. Out of interest did they suggest what mortgage you could apply for if you did have 10% deposit?

Good luck with your application. Unbelievable for the money to have run out so early

FlyingCat

I don't have all the details of what they told the mortgage broker unfortunately, I have only seen the reply they gave to try and appeal.

In fact, HTB Scotland have not even told me I have been declined, they have only been in touch with the broker, which I actually find to be an utter joke (I have been calling every day for an update...)

The annoying thing is that £100m is sitting there for next year, to me they should use that money now for all those trying to buy!

Hope your partner does not lose out on the flat. Nothing worse than the undue stress of house buying!

kingstreet

You can use HTB Mortgage Guarantee on newbuilds, if the builder won't offer the property on MI NewHome, the Scots equivalent of NewBuy.

Fox137

He's going to see a broker tonight, but they were doubtful of having anything suitable. He does have a 10% deposit but not 30% like his bank wanted. Ive told him to ask about the MI New Home scheme and the HTB Mortgage Guarantee scheme. Hopefully it will all work out, if not it'll be an older flat

FlyingCat

kingstreet wrote: »

You can use HTB Mortgage Guarantee on newbuilds, if the builder won't offer the property on MI NewHome, the Scots equivalent of NewBuy.

Thanks Kingstreet. Was looking last night at alternatives.

MI NewHome needs to be approved by the builder I believe? Is that correct? If so, is this likely they would allow this after us saying we were doing HTB?

For the HTB Mortgage Guarantee, I take it this would just be an application through HTB? as with the equity share scheme?

The other issue we have, is that Taylor Wimpey have offered to pay Stamp Duty, am I right that these schemes do not allow "financial incentives"?

Any help/info would be appreciated!

FlyingCat

Fox137 wrote: »

He's going to see a broker tonight, but they were doubtful of having anything suitable. He does have a 10% deposit but not 30% like his bank wanted. Ive told him to ask about the MI New Home scheme and the HTB Mortgage Guarantee scheme. Hopefully it will all work out, if not it'll be an older flat

Hope it all works out, needing a 30% deposit is pretty unachievable for most people!

kingstreet

MI NewHome/NewBuy requires a contribution from the builder, so may not be available.

If it is, cash incentives are not permitted.

HTB - MG is lender approved, not like the HTB - Equity Loan scheme. You don't have to apply like you do for a HTB - Equity Loan. It's a 95% mortgage, but the guarantee is underpinned by HMG and funded by borrowers via higher rates (5% to 5.5% pa).

TBH I've never tried to do a HTB - MG on a newbuild, but on our scheme incentives are not permitted. The scheme tends to be centred on particular builders/brokers and AFAIK only two lenders are currently offering it on newbuilds.

FlyingCat

Looking like getting a 95% mortgage is going to be a lot more costly and really limit our options for a mortgage...really would hate to lose this house as we love it and got such a good deal!

Hopefully the HTB appeal works but I am really not holding my breath, Scottish Government are useless idiots!

kingstreet

As a matter of interest, which lender was topping-out at 70% on a residential newbuild flat?

The usual suspects will lend at least 75%, with a couple going upto 85% (assuming they'll lend up there of course).

Fox137

kingstreet wrote: »

As a matter of interest, which lender was topping-out at 70% on a residential newbuild flat?

The usual suspects will lend at least 75%, with a couple going upto 85% (assuming they'll lend up there of course).

Clydesdale Bank who his current mortgage is with. Hoping the Broker knows her stuff, from what he's told me it's doubtful. Had a quick look and think Barclays and RBOS might do HTB MG. He's with the broker just now, will be interesting to hear the outcome!