8. Crofter Housing Grants and Loans
8.1 How the Crofters Building Grants and Loans Scheme (CBGLS) works
NOTE: only available in crofting areas.
Registered crofters have access to a unique scheme of grants and loans to assist them with the costs of building a new croft house or of improving an existing croft house. Both tenants and tenants who have purchased, applying within seven years of purchase, may be eligible. The scheme is administered by the Scottish Executive, Rural Affairs Department.
Anyone wanting further information about the scheme may contact:
Crofting Branch, SERAD, Room 106 Pentland House, 47 Robb's Loan, Edinburgh EH14 1TY (tel: 0131 244 6210). Alternatively contact your local SERAD area office.
To build a new house |
To improve the existing croft house | |
Grant |
£11,500 |
£2,000 |
Loan |
£17,500 |
For eligible work, up to a maximum loan of £10,500 |
Maximum totals |
£29,000 |
£12,500 |
Information on housing loans
For improvement works, the maximum repayment period is 20 years. For the building of a new croft house, the maximum repayment period is 40 years.
The interest rate for loans is 7% and is fixed for the duration of the loan. By way of examples, a £17,500 loan over 40 years would involve the crofter repaying a total of £1308.48 a year in two six-monthly payments in May and November. For a loan of £10,500 repayable over 20 years the annual repayments are £983.38, and the comparable figure for repaying over a 10 year period is £1,477.60.
Loans have to be legally secured in favour of the Scottish Ministers and a crofter on low income may have to find a guarantor – someone who is prepared to repay the outstanding loan should the crofter concerned get into difficulties with loan repayments.
A crofter is not only allowed to combine the grant and loan to build a new house but can also – and often does – combine the loan element with an Improvement Grant from the Council (see Section 11.1) to renovate his or her home.
Eligibility for CBGLS assistance and application process
Although all registered crofters and cottars in the Highlands and Islands are potentially eligible for housing grant and loan assistance, CBGLS is a discretionary scheme, and there is no automatic right to assistance.
Even if the applicant's existing accommodation is satisfactory, he or she may still qualify for CBGLS assistance if it is necessary – from an agricultural point of view, or for the purposes of an existing business – for the applicant to live on the croft.
CBGLS assistance cannot be used to build or improve a second or holiday home.
The minimum investment for assistance towards house improvements is £8,000.
Application forms and information on the application process and the supporting evidence required (plans, planning consents, building warrants) are available from the local SERAD area offices, or from Crofting Branch. A booklet setting out guidance notes for applicants is also available.
