Nationwide confirms participation in First-Time Buyer equity share scheme in Scotland

Nationwide Building Society will be accepting mortgage applications from those looking to participate in the Scottish Government’s first-time buyer equity share scheme, the First Home Fund, which launches today.

The new scheme will help first-time buyers in Scotland buy their own home, with the Scottish Government offering an equity loan of up to £25,000 (or 49 per cent of the property’s value, whichever is the lower amount). The buyer will provide a minimum deposit of five per cent of the purchase price.

Unlike other Scottish Government shared equity schemes, the First Home Fund allows buyers to purchase both existing and new build properties. And, as with Help to Buy (Scotland), there is no deadline set for repayment of the equity loan on First Home Fund, which will also be interest free. The first-time buyer has the option of acquiring all or some of the Scottish Government’s retained equity share at any time.

The First Home Fund runs alongside, although cannot be combined with existing schemes such as Help to Buy (Scotland) and Open Marked Shared Equity. The scheme will run with £150 million of funding or until March 2021, whichever comes first.

Henry Jordan, Nationwide’s Director of Mortgages, said: “We welcome any schemes designed to assist first time buyers onto the housing ladder especially because, as a mutual, the Society was founded with the purpose of helping people into homes of their own. We are, therefore, pleased to be supporting the Scottish Government’s first-time buyer equity share scheme by accepting applications, which will give existing Nationwide members and new customers in Scotland access to the Society’s highly competitive mortgage deals.”

Customers wishing to enter the scheme will have access to Nationwide’s competitive Shared Equity product range, which includes two-year and five-year fixed rate options as well as a two-year tracker product all at a range of LTVs.

Notes to Editors

Key features of Nationwide’s fixed and tracker mortgage product range for new applications

1. Flexibility:

  • Overpayments (maximum of 10% of the initial amount borrowed per annum where an ERC applies to the product. Where a product is not subject to an ERC, there is no maximum overpayment allowance).
  • Apply for a Further Advance, the additional borrowing facility.

2. Free Standard Valuation:

  • All standard valuations are fee free.

3. Maximum LTV:

  • 95% LTV mortgages are available to:
    • First-time buyers and home movers.
    • Existing Nationwide mortgage borrowers switching at the end of their current deal or moving home.
    • Save to Buy customers.
  • Maximum 75% LTV on new build flats and 85% LTV on new build houses.
  • Maximum 80% LTV on equity share products.

4. Base Mortgage Rate:

  • Any mortgage products reserved on or before 29 April 2009 will revert to the Base Mortgage Rate (BMR). If the borrower chooses to switch to a new Nationwide mortgage product, the new product will currently revert onto our Standard Mortgage Rate (SMR).
  • Both are variable rates which we may vary in accordance with our mortgage terms and conditions. However, the BMR is guaranteed to be no more than 2% above the Bank of England base rate, whilst the SMR has no upper limit or cap. If the borrower chooses to switch to a new product from a BMR, it is not possible to switch back to the BMR at a later date.
  • All mortgages reserved on or before 3 March 2010 include the option to apply for a payment holiday and borrow-back facility. Any mortgages reserved after this date will no longer include these facilities.
  • If the borrower is currently letting their property they will be unable to switch to a new mortgage deal and their mortgage will automatically revert to the Nationwide variable rate as stated in their mortgage offer.

5. Early repayment charges (ERCs):

If you repay a mortgage early or make an overpayment of more than your overpayment allowance, you may need to pay an Early Repayment Charge. For Nationwide mortgages reserved after 8 October 2014, you would need to pay a percentage of the outstanding loan amount as follows:

Fixed Rate Deal Period
  2 years 3 years 4 years 5 years 10 years
Year 1 2% 3% 4% 5% 7%
Year 2 1% 2% 3% 4% 7%
Year 3   1% 2% 3% 7%
Year 4     1% 2% 7%
Year 5       1% 6%
Year 6         5%
Year 7         4%
Year 8         3%
Year 9         2%
Year 10         1%

  • ERCs don’t currently apply to our Tracker Rate mortgages.

About Nationwide

Nationwide is the world's largest building society as well as one of the largest savings providers and a top-three provider of mortgages in the UK. It is also a major provider of current accounts, credit cards, ISAs and personal loans. Nationwide has around 15 million customers.

Customers can manage their finances in a branch, via the mobile app, on the telephone, internet and post. The Society has around 18,000 employees. Nationwide's head office is in Swindon with administration centres based in Northampton, Bournemouth and Dunfermline. The Society also has a number of call centres across the UK.

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