Help to Buy Repayment
Click to see the different processes to redeem your Help to Buy loan through a sale, remortgage paying in full or staircasing part of the loan:
Can I pay off my Help to Buy loan by remortgaging?
You can start the Help to Buy Redeem process without selling. This process covers if you don't sell the property but do settle the loan in full (normally through a remortgage, further loan, or personal savings).
- 1Mortgage Valuation Obtain a RICS Valuation, we have valuers available this week*, and reports are sent in 5 working days.
- 2Application Submit your Help to Buy Application Form, including your RICS valuation and pay your admin fee.
- 3ID Provide your ID and Source of Funds.
- 4Mortgage offer You progress your mortgage application, and once approved, the mortgage offer/further advance letter is sent to your solicitor. This can take 10 to 20 working days.
- 5Source of Funds Certificate Your Solicitor reviews the offer and, if satisfied, submits a Certificate of Source of Funds to Help to Buy within 3 working days.
- 6Redemption Statement Help to Buy issue a Redemption Statement within 10 to 15 working days. You can chase them to speed this along.
- 7Completion Statement Your solicitor prepares the file for completion and sends their legal undertaking to Help to Buy, requesting their Authority to Complete.
- 8Authority to Complete Help to Buy reply after 15 working days. You can chase them to speed this along.
- 9Completion Your solicitor draws down the new mortgage or further advance and pays off the loan and old mortgage if applicable. If repaid in full, an e-DS1 is submitted to the Land Registry to remove the charge from the title. If a partial repayment is made, a memorandum of staircasing is issued confirming the amount remaining on the Help to Buy equity loan.
Can I sell my house if I have Help to Buy?
You can sell the property over which the loan is secured. However, it is important to remember that you must repay the loan in full regardless of whether the property has gone up or down in value. The loan repayable is calculated as the loan percentage of either the current market value or the agreed sale price (whichever is higher).
To sell your property, you will need to:
- 1Mortgage Valuation Obtain a RICS Valuation, we have valuers available this week*, and reports are sent in 5 working days.
- 2Application Submit your Help to Buy Application Form, including your RICS valuation and pay your admin fee.
- 3ID Provide your ID.
- 4Redemption Statement Help to Buy issue a Redemption Statement within 10 to 15 working days - faster if you chase them.
- 5Completion Statement Your solicitor prepares the file for completion and sends their legal undertaking to Help to Buy, requesting their Authority to Complete.
- 6Authority to Complete Help to Buy reply after 15 working days - faster if you chase them.
- 7Completion On the completion of the sale, your solicitor repays the loan in full from the proceeds. An e-DS1 is submitted to the Land Registry to remove the charge from the title.
Your loan at the outset was 20% of the purchase price of £250,000 then the loan value at that time was £50,000. When you sell you agree a sale price of £300,000 which means the value to repay the loan is 20% of £300,000 which is £60,000. Read more - How to Sell a Help to Buy Property.
Help to Buy Staircasing allows you to partially redeem your Help to Buy equity loan while owning more equity in your home. Read more - How do I partially staircase a Help to Buy?.
- 1Mortgage Valuation Obtain a RICS Valuation.
- 2Application Submit your Help to Buy Application Form, including your RICS valuation and pay your admin fee.
- 3Provide your ID & source of funds.
- 4Source of Funds Certificate Your Solicitor reviews the source of refunds within 5 working days and often requests further evidence. Once satisfied, the solicitor submits a Certificate of Source of Funds to Help to Buy, within 3 working days.
- 5Redemption Statement Help to Buy issue a Redemption Statement within 10 to 15 working days - faster if you chase them.
- 6Completion Statement Your solicitor prepares the file for completion and sends their legal undertaking to Help to Buy, requesting their Authority to Complete.
- 7Payment At this stage, you transfer the full amount for the loan repayment into the solicitor's account, who will hold it until completion day.
- 8Authority to Complete Help to Buy reply after 15 working days - faster if you chase them.
- 9Completion Your solicitor pays in the completion monies. If a partial repayment is made, a memorandum of staircasing is issued confirming the amount remaining on the Help to Buy equity loan.
Your loan at the outset was 20% of the purchase price of £250,000, then the loan value at that time was £50,000. When you staircase, you agree on a property valuation of £300,000 and to staircase 10%, which means the value to repay the loan is 10% of £300,000, which is £30,000.
What are the requirements to staircase a Help to Buy loan?
- The minimum amount you can staircase at one time is 10% (of the total market value of the property at the time you staircase);
- The above requirement means that when the lenders’ equity in your property is less than 20%, you can only repay the loan in full;
- You may only staircase in multiples of 10%, that is 10%, 20%, 30% etc; and
- You cannot staircase if there are any arrears of interest payments and/or management fees on your mortgage account. Any arrears must be cleared, before a staircase transaction can proceed.
How can you contact Help to Buy?
- Email:customerservices@myhelptobuyloan.co.uk
- Address: Help to Buy customer services, PO Box 5262, Lancing, BN99 9HE
How do you repay Help to Buy?
Help to Buy Repayment is the process undertaken by homeowners who originally used the Help to Buy Equity Loan scheme to buy their first property. The loan is often repaid at the end of the first fixed mortgage term and settled by:
- Remortgaging
- Personal savings, a further loan or a gift from family
- Selling your property
This article explains the process of Help to Buy Redemption with all of the following providers Help to Buy, HomeBuy Direct, FirstBuy, First Time Buyers Initiative (FTBI), Armed Forces Home Ownership Scheme (AFHOS), Help to Buy and London Wide Initiative (LWI).
Download your Help to Buy Repayment Form
What are the requirements for the RICS valuation surveyor?
- The Valuer must be registered with the recognised qualification of RICS;
- The Valuer must be independent to an estate agent;
- The report must be on headed paper, signed by the RICS surveyor and addressed to the Administrator;
- The Valuer MUST provide at least 3 comparable properties and sale prices;
- The comparables provided must be like for like in terms of property type, size, and age and within a 2-mile radius to the property that is being inspected;
- The Valuer must not be related or known to you;
- The Valuer must inspect the interior of the property and provide a full valuation report;
- Valuations carried out for bank or mortgage purposes are not acceptable, and
- A copy of the valuation report must be supplied to the Administrator; the inspection date must be shown.
Help to Buy Solicitors Fees
Our experienced conveyancing solicitors can help you repay your Help to Buy loan. Our Fixed Fee quotes are truly fixed with no hidden extras, and we're rated Excellent on Trustpilot. Get a free, no-obligation online quote today.
What happens after 5 years Help to Buy?
You do not pay any interest on your loan for the first 5 years after you buy a house using the Help to Buy Scheme. Once that period is up, you will be charged an interest fee of 1.75% of the loan you took. For example, if you borrow 20% of the purchase price of your house, the interest rate only applies to that 20%.
Caragh is an excellent writer in her own right as well as an accomplished copy editor for both fiction and non-fiction books, news articles and editorials. She has written extensively for SAM for a variety of conveyancing, survey and mortgage related articles.
