Homestake Advisory Service
What are the basic criteria for the Homestake scheme?
Homestake is a new scheme that was launched by the Minister for Communities in September 2005 and is aimed at helping people on low incomes who want to own their own homes but who cannot afford to pay the full price. Homestake is aimed at first-time buyers but also others whose life circumstances have changed, for example, people affected by marital breakdown. The scheme has been designed flexibly so that it can also be used to assist disabled people and older people access more suitable housing. Although Homestake is aimed at households on low incomes, a person may also be eligible to apply if:
- they are a first time buyer, or
- they have just undergone a big change in your household circumstances (for example, you have just split up from a partner or spouse), or
- they are disabled or have particular needs and your current home isn't suitable for these needs, or
- they have special reasons for needing to live in a particular area
- their home is scheduled for demolition.
This is not an exclusive list - eligibility criteria will be set for schemes before they are marketed.
In addition, a person must meet the financial criteria specified by the housing association. Because house prices vary from area to area, these criteria will differ depending on where a person lives. In general, the housing association will need to be satisfied that:
- a person cannot afford to buy a home without help from Homestake, and
- they will be able to keep up with their mortgage payments and all the other housing costs involved, such as council tax, factoring and service charges and household bills.
A Homestake owner will generally pay for between 60 and 80 per cent of the price of a property with the remainder held by a registered social landlord using Homestake grant funding. For more information about Homestake generally, go to www.communitiesscotland.gov.uk
What are the exceptional criteria within the Homestake guidance?
Homestake was originally aimed at first time buyers on low incomes. However, individuals or households who have ‘particular needs’, such as an evidenced need to move due to a disability, can access Homestake using the following exceptions:
- They may not need to be first time buyers; they could already be home owners.
- They may not be restricted to the maximum annual income levels; Income should be assessed to determine how much, after exceptional housing and living costs, should be taken into account when calculating a reasonably affordable mortgage.
- The 3 x income = salary ‘multiplier’ is not applicable. Knowledge of systems where mortgages are paid through benefits should be taken into account.
- It may not be necessary to have more than one mortgage quote from more than one mortgage lender. One written quote may be sufficient as long as a justifiable explanation is also provided.
- They can purchase a stake in a property as low as 51%. They do not have to purchase a share between 60%-80%.
- They are not restricted to buying a stake in a property which only has two bed spaces larger than their current need; they could be eligible for a larger property over and above this limit.