The Parc Shared Equity Scheme is a new shared equity scheme following in the footsteps of the highly successful LIFT initiative supported by the Scottish Government. The Parc Shared Equity Scheme is funded by Parc Craigmillar Ltd. The Scheme offers first time buyers, those in rented accommodation, key workers, returning army personnel and those with a connection to the Craigmillar area the opportunity to own their own home with the help of an equity loan from Parc Craigmillar Ltd.
The Scheme means that you, the purchaser, will only need a minimum 5 per cent deposit of the purchase price of your new home rather than the average 20 per cent deposit currently being required by most Lenders on new build property. The balance of the purchase price of your new home will be met through an equity loan from Parc Craigmillar Ltd. who will fund up to 25 per cent of the purchase price.
In line with equity incentives offered by other developers the scheme is set for a fixed period of 10 years, after which the company will look for the equity loan to be repaid in full.
Questions & Answers
Q. What share of the property will I be buying?
A. You will be purchasing 100% of the property. You will required to fund a minimum of 75% of the purchase price usually by way of a mortgage (including any deposit required by the lender) the balance being funded by Parc Craigmillar Ltd. through their equity loan.
Q. How much of a deposit will be required?
A. In order to qualify, you will be required to have an average of 5% of the purchase price, as a deposit (this figure may vary depending on your mortgage product).
Q. What other costs are involved?
A. You will be responsible for legal costs, stamp duty land tax (where applicable) and any fees in relation to your mortgage including survey fees.
You will also be responsible for all maintenance, repairs, insurance, service charges and factoring costs and utility payments for your property as well as your mortgage repayments and Council Tax.
You will be responsible for a final redemption fee to cover the costs of discharging the final equity loan.
Q. Who will qualify for the Scheme?
A. The Scheme has been put in place to help purchasers overcome the problem of finding the high deposits being requested from mortgage lenders at this time. A full list of criteria has been produced and includes first time buyers, those in rented accommodation, key workers, returning army personnel and those with a connection to the Craigmillar area.
Q. How do I know if I qualify?
A . After identifying the property of your choice, you will need to be qualified by an Independent Financial Advisor on the basis of the criteria outlined above. After qualification is verified you will be contacted by one of our team within 7 days to advise you of the result.
Q. How do I reserve a property?
A. You will be asked to complete a Shared Equity reservation form that relates to your property. A reservation fee of £250 will be paid at this point. On completion of your purchase, the reservation fee will be treated as part payment to the full purchase price.
Q. Will there be any additional deposit to pay?
A. Yes a 1% deposit of the total sales price will be required on conclusion of missives. This will be treated as part payment of the purchase price.
Q. Can I buy out the remaining equity stake?
A. Yes, the outstanding stake (up to 25%) can be increased at any time. You can increase your equity stake from a minimum of 75% either by one single stake or up to a maximum of two stakes (the minimum stake increase being 5%).
If the purchaser’s equity stake is increased within the first 5 years then the equity stake purchase price will be based on the original purchase price.
From years 5 to 10, the redemption figure for the equity stake will represent the open market value at any given time (based on an independent valuation.
Q. What happens if I sell my property?
A. In this instance, assuming you have not already bought out the equity stake, the equity stake and the compounded interest would be paid to PARC Craigmillar Ltd. at time of re-sale directly from the proceeds.
Q. Do I pay a rent on the equity stake?
A. No rent is payable on the equity stake.
Q. Do I pay interest on the equity loan?
A. There is no interest payable on the equity loan.
Q. What do I have to do to receive the equity loan?
A. You will be required to enter into a variety of legally binding agreements with Parc Craigmillar Ltd. to protect the Company’s interest in the equity loan which include a standard security over the property as security for the equity loan.
Q . Will I be able to rent out the property?
A. The property MUST be your prime and only residence.
Terms and Conditions
Shared Equity Deals may be available on certain plots and are strictly subject to the following terms and conditions together with any of the general terms and conditions set out in the reservation form, our advertisements and on this website:
1. Offers for you to pay a percentage (e.g. 75%) of your new home initially are based on you paying that percentage of the agreed price at the time of completion.
2. The remaining percentage (25%) of the purchase price becomes a second charge on your property in favour of PARC Craigmillar Ltd.
3. PARC Craigmillar Ltd do not offer first mortgages.
4. In the event that the purchaser owes any monies which are not covered by the amount of equity in the property at the time of future transfer, PARC Craigmillar Ltd. reserves the right to pursue the purchaser for the outstanding balance as a personal debt.
5. For full details of the second security, please refer to a copy of the second charge loan agreement which you will need to sign before Legal Completion.
6. The difference in value at the time of sale or transfer (if after the first five years) against the value at the time of Legal Completion will be calculated based on valuations by two independent valuers appointed by us. In the event of any dispute, an average of the valuations of the two independent valuers is final and binding.
7. Individual lender's security requirements may vary and it is the purchaser’s responsibility to obtain mortgage finance through a PARC Craigmillar Ltd. nominated independent mortgage adviser.
8. This offer cannot be used in conjunction with any other offer on the same plot.
9. PARC Craigmillar Ltd. reserve the right to withdraw or alter any of these offers at any time prior to the payment of a reservation fee. Contracts must be exchanged within 14 days of reservation of your property. Failure to do so may result in the loss of all or part of your reservation fee.
10. All PARC Craigmillar Ltd offers are subject to the use of a nominated Independent Mortgage Advisor. PARC Craigmillar Ltd will not be liable for the refusal of a mortgage based on the borrower’s individual circumstances which leads to the loss of any reservation fee.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP THE REPAYMENTS ON YOUR MORTGAGE AND/OR YOUR EQUITY LOAN AND/OR OR ANY OTHER DEBT SECURED ON IT