What happens once you've applied
What happens after your money adviser has submitted your application form will depend on what scheme you're eligible for.
How long your application takes to process depends on how quickly the Home Owners' Support Fund team receives all the information it needs. A typical, straightforward application takes approximately 4 to 6 months to settle.
If you're eligible under the Mortgage to Shared Equity scheme
- If you meet the eligibility criteria, an assessment will be carried out to work out how much you can afford to pay towards your secured loans. This will help calculate how much equity the Scottish Government needs to take in your property so you can remain the home owner.
- You'll then be told how much equity the Scottish Government is prepared to take in your home. If you're happy with this, the necessary legal arrangements will be undertaken.
- If it's decided at this stage that the Mortgage to Shared Equity scheme isn't suitable, you can still be considered for the Mortgage to Rent scheme.
- You'll need to take legal advice before committing yourself to the Mortgage to Shared Equity scheme.
You'll have 10 years to buy back the Scottish Government's stake in your property. Otherwise, the Scottish Government will remain a shareholder for as long as you're the owner.
If you're eligible under the Mortgage to Rent scheme
An independent surveyor – assigned by the Home Owners' Support Fund – will estimate the value of your property. This is based on the information you gave in your application form.
Legal and property search
A Home Owners' Support Fund solicitor will carry out a legal and property search on your home – this identifies all owners and whether there are any secured debts, inhibitions, notice of potential liabilities or trustees.
The independent surveyor will get in touch to arrange a suitable time to carry out an inspection of your property.
Approaching social landlords
Participating social landlords – like housing associations or your local council – will be given the opportunity to buy your property through the Mortgage to Rent scheme.
Participation from social landlords is voluntary. It's not guaranteed that a landlord will want to buy your property.
Social landlord inspection
If a social landlord's interested in buying your home, they'll carry out an inspection to determine if any repairs are needed.
You must allow access to inspectors – otherwise your case will be withdrawn.
If your property's been altered from its original layout, you can be asked to provide consents.
Consents are documents provided by your local council giving consent to make alterations to your property. These could be building warrants, completion certificates or a letter of comfort.
If you don't have consents, you'll need to contact your local council's planning department and ask for them.
Your lenders will be asked for an up to date statement that confirms the amount outstanding from your secured loans.
The surveyor will provide the Scottish Government with an updated valuation of your property.
The Home Owners' Support Fund can contribute up to £8,500 for gas and electrical repairs, and any other repairs identified by the surveyor.
If the repairs cost more than £8,500, or do not meet the above criteria, you'll be asked to meet the costs if you have equity in your property. If you don't have equity, the landlord or lender will be asked to meet the costs.
Equity is any money remaining after the sale of your property and your debts are repaid.
A shortfall means the valuation of your property isn't enough to clear the debts owed to your lenders.
For example, if your property's purchase price is £80,000 and your secured debts are £90,000, there will be a £10,000 shortfall owed to your lenders. You'll need to negotiate a payment plan with your lenders to pay the outstanding balance.
Your application can't progress until the Scottish Government has written confirmation from your lenders that you've reached an agreement with them.
The Scottish Government won't get involved in shortfall negotiations between lenders and applicants. If you need some support, your money adviser may be able to help you.
If your case proceeds, offer letters will be sent to all parties to sign and return. This letter outlines the terms and conditions of the sale, including the distribution of funds and lists of repairs.
Transferring ownership (conveyancing)
If all parties agree to go ahead with the sale of your property, a Home Owners' Support Fund solicitor will contact you to complete the conveyancing process.
It's important you read and respond to the solicitor's letters quickly.
Your landlord will ask you to sign a tenancy agreement explaining the terms and conditions of your tenancy – including what rent you'll pay.
After your secured lenders – or others with an interest in your home – have been repaid, you're allowed to keep up to £11,360. If you're 60 years old or over, you can keep up to £17,040. Any money above these amounts will be used to support the Mortgage to Rent scheme.