After sale shared equity procedures: guidance 2019
Updated guidance to procedures to be followed for all after sale transactions related to shared equity properties.
Where the shared equity owner wishes to sell, this can take place at any time unless there is a Golden Share in which case Scottish Government Guidance Note 2011/03 - Low-cost Initiative for First Time Buyers ('LIFT') Buy-Backs & Re-sales - shall apply.
The RSL should send an email to the owner with the disclosure mandate Annex 4 (C) in terms of the correspondence in Annex 4(A) and await a copy of the property schedule and Home Report.
All shared equity owners are responsible for their own selling costs and they should ask their solicitors for details of their fees as well as all other fees and the cost of all searches, registration dues and all other outlays. The fees of the shared equity owner's solicitor are not to be deducted from the proceeds that are due to be returned to Scottish Ministers. While this should be clear to shared equity owners from the correspondence which is sent to them, the RSL should be alert to the possibility that owners or their solicitors may nonetheless seek to progress the sale transaction on the basis that the owner's legal fees will be deducted from the sale proceeds before the balance of the proceeds is returned to the RSL, and should seek to clarify and insist upon the correct position in all contact with the owner and their solicitors.
The RSL should also obtain from the Valuer a copy letter of reliance in favour of Scottish Ministers or the RSL (dependent on whether shared equity was provided pre- or post- 6 April 2008) in the form set out in Annex 4(E) together with a copy of the marketing particulars or schedule for the property. If the property sale price is at least 95% of valuation (as read with the letter of reliance), and is at the highest price offered then the sale of the property may proceed. Valuations will be valid for a 6 month period from the date of issue and after this a refresh will be required.
If the proposed price is (a) less than 95% of Valuation, or (b) has been affected by any of the assumptions and disregards in the shared equity agreement, the RSL will be required to seek approval from the relevant Scottish Government More Homes Division area team in terms of the email set out in Annex 4(F).
The RSL should send an Open Market Sale Form set out in Annex 4 (H) to Scottish Government More Homes Division Finance team at Shared_Equity_Support@gov.scot
The RSL should arrange for the capital receipt to be returned to the Scottish Government More Homes Division Finance team.
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