First time buyers are set to benefit from a new £2.1 million support initiative developed by leading Scottish housebuilder Cruden Homes to address the major financial challenges which are preventing many potential buyers from securing a traditional mortgage.

Unique Property Solutions (UPS) was launched today (Thursday, July 8) in the Govan area of Glasgow by Housing and Communities Minister, Alex Neil MSP, on behalf of Cruden Homes.

Developed by Cruden, alongside partners Glasgow Credit Union, the Co-Operative Bank and NHS Credit Union, the UPS initiative will provide a financial model of bespoke mortgage products and services which offer first time buyers up to 20 per cent deposit funding loans and mortgages of up to 95 per cent, following a full affordability qualification assessment.

The partnership initiative supports the Scottish Government’s policy on housing which has identified the need to adopt a fresh approach to fund affordable housing in Scotland, and help would-be buyers overcome major financial obstacles such as raising large deposits, poor credit history and low incomes.

The new UPS model is part of a wider package which supports the aims of CGAP and increases the options available to potential home owners. Working with Govan and Elderpark Housing Associations and Glasgow City Council, Cruden Homes is already tackling the issue of affordable housing head on by providing support through the Scottish Government New Supply Shared Equity Scheme (NSSE).

Buyers who qualify for NSSE funding are able to purchase a new home paying just 60 – 80 per cent of the original value of the property whilst still owning 100% of their home.

It is hoped the UPS model may be replicated across many more regeneration projects in Scotland.

Minister for Housing and Communities Alex Neil, said: “Scotland's housing system must adapt with radical thinking and bold new ideas to the financial realities presented by the credit crunch and reductions in public spending.

“More than ever we need the public and private sectors to work together to make sure people in Scotlandcan meet their housing needs and aspirations.

“I welcome innovative approaches, such as this initiative, being developed by private companies in partnership with other organisations, to try to help first-time buyers get onto the property ladder.”

John Gallacher, managing director of Cruden Homes West, said: “UPS is a funding initiative tailored to each individual’s circumstances. We know there are many young people, first times buyers and people with a poor credit history who are being excluded from owning a home.

“Our approach is to work with these individuals to encourage regular saving through Glasgow Credit Union and build a bespoke re-payment plan so that in 6-12 months down the line they can be considered for a mortgage. This initiative is perfect for first time buyers who have been unable to save large deposits, who may have struggled to obtain a mortgage from the bank or who feel their income is too low.”

In addition to the £2.1m support initiative, UPS aims to provide a wide range of services, including;

Alternative banking options
Affordable credit and savings plans tailored to individual buyers
Face to face money and budgeting advice
Expert guidance on the purchase of a new home
Advice in addressing issues affecting credit ratings
Provision of top up loans to clients without deposit savings

John Gallacher, Managing Director of Cruden Homes, said: “The biggest barrier to home ownership is finance, and as a responsible builder, we have made it our priority to work with our partners in the public and finance sectors to overcome this chronic problem in Scotland. We’re confident our new UPS package will offer many new buyers, particularly those buying a house for the first time, a real alternative to obtaining a traditional mortgage. As a son of Govan, I’m very proud to play a small part in the regeneration of this historic part of Glasgow and believe that we can help attract in the region of 1,500 people back to the town to live in this vibrant new community.”

Kate Dunlop, Chief Executive of Glasgow Credit Union, the UK's largest and most successful credit union, said: "We work tirelessly to improve the financial circumstances of all our members and to ensure that our potential members are aware of the diverse range of ethical financial services we offer.This is an important partnership which will assist in the regeneration of Glasgow and help people achieve their aspirations to become home owners. We are proud to be working with Cruden and hope that the initiative is a catalyst for more".

Councillor Alistair Watson, Convener of the Development and Regeneration Services Policy Committee, said: “In the current financial climate the problems associated with some people getting mortgage finance are well documented. We are keen to see areas with a mixture of privately owned and rented accommodation and therefore welcome this initiative as a real opportunity to assist home-buyers in Govan.

“This project also adds to the Council’s efforts to halt the physical and economic decline of central Govan. With family connections to the area I am pleased to see complementary efforts to encourage development and investment in Govan which will, in turn, also help to strengthen its local communities.”

Govan was chosen for the launch as it is home to one of the most significant regeneration projects currently underway in Scotland. More than £120 million worth of public and private investment is planned to regenerate the local community over the next six years through the Central Govan Action Plan (CGAP).

It is anticipated the regeneration project will attract inward investment and employment to the area, while hundreds of new homes will encourage people to return to the town and breathe new life into the community.

As part of the regeneration of Govan, Cruden’s new housing developments represent a £68 million investment programme. The housebuilder is currently creating four residential developments as part of wider plans to build 508 new homes in total.

Prices across the four developments range from £84,000 for a two bedroom apartment to £130,000 for a three bedroom home (which includes a limited number of New Supply Shared Equity Units.)

For further information on Cruden’s Unique Property Solutions package or information on Cruden’s four developments in Govan, please call Linda McLean on 0141 583 4157.

Read more about Park Court and Govan Gateway