Nationwide and the Royal Bank of Scotland are throwing their weight behind the national mortgage indemnity scheme, developed by home-building industry body Homes for Scotland.
In addition, Bank of Scotland/Halifax will offer mortgages through the scheme in the near future. Twelve house builders have signed up for the scheme and more are expected to follow shortly.
The Scottish Government will support the scheme by providing a guarantee.
It will help households across Scotland who could afford a mortgage on a new build property, but are currently locked out due to high deposit requirements.
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It will enable credit-worthy borrowers to access 90 to 95% loan to value mortgages from participating lenders to buy new build homes in Scotland, with a maximum sales price of £250,000.
Homes for Scotland is projecting that the scheme has potential to generate sales of up to £1 billion over three years, and could also create or safeguard 22,800 new construction jobs and over 650 apprenticeships.
According to the Council of Mortgage Lenders, there were 44,000 loans advanced for all home purchases in Scotland in 2011 compared to 105,000 in 2006 – a fall of 60%.
In Edinburgh, launching the MI New Home mortgage indemnity scheme, Deputy First Minister and Cabinet Secretary for Infrastructure, Investment and Cities, Nicola Sturgeon said: "The Scottish Government wants to help people get onto and move up the housing ladder, where it is sensible and sustainable for them.
"High deposit requirements have presented a major stumbling block for those who want to buy a new build home.
"That is why securing the backing of our leading lenders for this mortgage indemnity scheme is hugely significant.
"I hope this new scheme encourages lenders to offer more high loan-to-value mortgages to credit-worthy borrowers who are currently unable to put down the large deposits demanded in the current mortgage market.
"This scheme demonstrates yet again that we will do everything that we can within our powers and our resources to get our economy growing, to create jobs and homes, and to challenge the UK Government’s misguided economic policies."
(CD)
