Loan fund for self-build homes reopens in Scotland


THE Scottish Government has announced that self-builders who are unable to access standard bank lending can now apply for a loan of up to £175,000 to help with the development costs of their home.

The Self-Build Loan Fund has reopened today (November 21) and aims to support the delivery of ‘good quality and energy efficient housing’.

Following a pilot scheme in the Highlands, the fund was launched nationally in 2018, with 41 loans worth a total of £6.2 million approved to date.

The fund is reopening after closing on 31 August 2022 to new applications. It is administered on behalf of the Scottish Government by the Communities Housing Trust.

The administration fees borrowers will pay to secure their loan is £895. The interest rate for the loan is 5.5% (9% for those in default). The agreed repayment period will depend on the nature of the project, but the loan is intended to be short-term and repaid on completion of the build.

Housing secretary Shona Robison said, “This fund aims to unlock the dream of building your own home, in many cases allowing people to stay in their local communities. We know it can be more difficult to access finance for self-build projects than for buying an existing property, and this fund is a crucial lifeline for those unable to access standard bank lending. When loans are repaid, the money can be re-used, during the life of the fund, supporting more self-builders and providing more homes for future generations.

“Self-provided housing can play an important role contributing to the long-term sustainability of our rural and island communities, and this £6 million Scottish Government fund will continue to help support this. It has had great success in the Highlands and Islands and has also provided dream homes for people living across the whole of Scotland.

“Wherever you live, if you’re interested in building your own home I’d encourage you to contact the Communities Housing Trust to find out more.”

Ronnie MacRae, CEO of the Communities Housing Trust, added, “In the years we’ve administered the fund, we’ve seen demand rise as conditions become even more challenging for people to build their own home. In many cases, families just need a bit of extra support and are fully able to build and then repay the loan.

“Self-build remains an important option for many, particularly in areas where no other options exist, so we are extremely grateful to the Scottish Government for continuing to provide the fund.”