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The New Scottish First Homes Fund:
The New Scottish First Homes Fund:
Breaking Down the Deposit Barrier for Scotland’s First-Time Buyers
For too many people across Scotland, the dream of homeownership has started to feel increasingly out of reach. While many households are perfectly capable of covering monthly mortgage payments, the real hurdle is the upfront cost. Saving thousands of pounds for a deposit while simultaneously paying high rents has trapped many aspiring buyers in a frustrating cycle.
Recognizing this squeeze, the Scottish Government has launched the new First Homes Fund, a shared-equity scheme specifically engineered to remove the deposit barrier and help first-time buyers take that crucial first step onto the property ladder.
What is the First Homes Fund?
The First Homes Fund is a brand-new shared-equity initiative designed to assist eligible first-time buyers in Scotland. Under this scheme, the Scottish Government provides a contribution of up to £10,000 towards your deposit to purchase either a new-build or an existing property.
Because it is a shared-equity scheme, the government takes a percentage equity share in your property. However, it is not a traditional loan or a second mortgage:
• No interest is charged on the government's contribution.
• There are no monthly payments to make to the government.
• You own the home and hold the full title outright.
Instead, the government simply repays its percentage equity share when you eventually choose to sell the property.
Who qualifies and what are the rules?
The scheme has been intentionally streamlined to help as many genuine first-time buyers as possible, but there are a few core criteria you must meet:
• First-Time Buyer Status: The scheme is strictly for individuals who do not currently own, and have never previously owned, a residential property anywhere else in the world.
• Property Value Limit: The fund supports home purchases up to a maximum property value of £300,000.
• You Still Need a Mortgage: This scheme is not for cash buyers. You must purchase the property with a capital-repayment mortgage, meaning you still need to meet standard lender affordability and credit criteria.
The importance of getting "mortgage ready" early
The first round of applications for the First Homes Fund is set to open by the end of June 2026. While the government aims to support thousands of households, funding phases like this are highly anticipated and positions can fill up quickly.
Waiting until the application window opens to look at your finances could mean missing out. Because you still have to secure a standard mortgage alongside the fund, getting your financial paperwork organised right now is the smartest move you can make. Lenders will still look closely at your:
• Income evidence (payslips, tax calculations, or accounts)
• Bank statements to evaluate your monthly commitments and spending habits
• Proof of identity and consistent address history
• Your own savings contribution, as you may still need to evidence your portion of the deposit
By sense-checking your affordability early, you can figure out your realistic property budget and ensure you are in the strongest possible position the moment the fund goes live.
How Advantage Home Finance can help
Navigating government schemes alongside traditional mortgage lending can feel overwhelming, but it doesn't have to be. At Advantage Home Finance, we help you understand exactly what the First Homes Fund means for your personal circumstances, mapping out your affordability and helping you get your documents perfectly organised.
We have access to a wide range of lenders across the market, including products and rates that aren't directly available to the general public. We will do the heavy lifting for you—assessing your options, guiding you through the shared-equity details, and ensuring you have a suitable mortgage strategy ready to deploy.
Best of all, because we want to make home ownership as accessible as possible, there are no fees for our time, advice, or guidance.
Your home may be repossessed if you do not keep up payments on your mortgage or other loan secured on it.
The information contained in this article is for general information purposes only and does not constitute financial or mortgage advice. You should always seek professional advice tailored to your individual circumstances before making any financial decisions.
Contact Advantage Home Finance today: property.connections@advantagehf.co.uk
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