Home building industry body Homes for Scotland has been awarded £250,000 by the government to enable it to work with lenders and builders to take forward the proposals.
Scottish Housing Minister Keith Brown said: “We want to do all we can to create new home owning opportunities for buyers who can afford mortgages, but are currently excluded due to high deposit requirements.
“Introducing a mortgage indemnity scheme would inject new mortgage liquidity into the market, protect jobs and support increased supply. This would also create more activity in the building sector as builders are able to unlock land and fund increased volumes.”
Both the Council of Mortgage Lenders (CML) and insurance broker Jardine Lloyd Thompson is set to work with Homes for Scotland to help develop the scheme.
CML policy consultant for Scotland Kennedy Foster said: “While much work still needs to be done in developing the details, this is a promising step.”
Progress has been made towards constructing a similar scheme for England and Wales, with developers and lenders actively working on a proposal for a joint initiative.
Jonathan Fair, chief executive at Homes for Scotland, added: “We believe this scheme has the potential to make a huge difference to the health of an industry so vital to our country’s social, environmental and economic well-being.
“The Scottish government should be applauded for its vision in helping to bring the first industry-wide scheme of its kind in the UK to fruition.”