Crofting mortgages decision is welcomed

A DECISION by the Rural Economy Secretary to write to the Royal Bank of Scotland urging them to give fair mortgage offers to crofters has been welcomed by MSP Kate Forbes.

Currently, those in receipt of the Croft House Grant have been unable to secure an RBS mortgage because the bank fears, in the event of insolvency, that the Scottish Government’s rights to recover monies under the scheme would rank ahead of the financial institution’s right to recover the home loan.

The saga came to light after crofters on Skye raised the matter with Ms Forbes, MSP for Skye, Lochaber and Badenoch.

She then wrote to cabinet secretary Fergus Ewing raising these concerns, particularly in light of the positive response in the Highlands and Islands to the Croft House Grant scheme.

As a result, Mr Ewing replied pledging his support and promising to write to RBS. In his response and letter to RBS, Mr Ewing noted that ‘a misperception’ had been created because the government’s rights are held against persons, whereas the bank’s are held against the property.

Ms Forbes said she had been extremely concerned on discovering two of her constituents had been unable to secure mortgages because they were receiving Croft House Grant assistance.

‘It is highly likely that there are others like them who have been denied a bank mortgage because of a misplaced perception about what happens in the event of insolvency,’ she continued.

‘The Croft House Grant scheme is really beneficial for crofters across the Highlands and Islands, and it would be deeply unfortunate if anything undermined that progress.’