Mortgages 'not available' on crofts

Banks would refuse borrowing on properties under crofting tenure, the Cairngorms National Park Authority (CNPA) has said.

The park authority said the issue came to light in discussions with the Council of Mortgage Lenders.

CNPA said the recession and banking crisis had led to changes in borrowing that made it harder for crofters to get a mortgage.

It said it would work with government and lenders on resolving the matter.

A croft is a small area of agricultural land held in tenancy and traditionally handed down through generations of the same family.

A Section 75 agreement legally binds any properties on, or built on, crofts to the land to encourage continued working of the croft.

It prevents the houses being sold separately as holiday, or second home.

The latest meeting of the Cairngorms' planning committee has voted 13-6 in favour of removing the legal requirement for a crofting couple in Newtonmore so they can get a mortgage.

Convener Duncan Bryden said their case was exceptional and was in exchange for a personal undertaking from the couple that they would not sell the property separate from the croft.

Mr Bryden said: "Mortgages are much less available, lenders are more risk averse and there is a much greater onus on the borrower to ensure funds are secure before embarking on a project."

He added: "There is an ongoing need to support essential houses in the countryside, outside villages, while safeguarding the wider interests of the park and the local community."

Don McKee, CNPA's head of planning, said a way around the wider issue of mortgages on croft houses had to be found.

He said: "The lender's main concern is that they should have the ability to sell a property on the open market if there is a default on payments.

"The Section 75 at the moment does not allow for this and we have suggested to lenders the implementation of a 'cascade' mechanism which would allow the property to be sold to steadily widening categories of people until it could be sold on the open market at 20 weeks if no purchaser had been found."