Heylo Housing: Staircasing Your Home
16/10/2018
3
4 min read
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Heylo Housing - staircasing your home has many similarities with the staircasing process you'd normally go through when you own a shared ownership property and wish to increase the percentage of the share that you own in your home.
Among the many incentives for staircasing, if you increase your share in the property, the amount of rent you pay is re-calculated and reduced accordingly.
This article gives a brief recap of the general staircasing process and then looks at how Heylo's approach differs from this and finally touches on stamp duty.
Overview of the Staircasing Process
We've included details relating to the remortgage process because people staircasing most often pay for the extra share using this approach. We've left out the fine detail to keep the overview as simple as possible.
Click for a comprehensive look at the Remortgage Process
- Client gets funding in place, either savings or (most likely) mortgage in principle
- Contacts Heylo to notify it of intention to staircase and pays any fees involved
- Heylo sends back documentation, agrees intention to proceed
- Client books mortgage lender's valuation if staircasing using a mortgage (if lender is happy with valuation, it sends the client a mortgage offer perhaps a week later)
- Client books independent RICS valuation
- Client sends over valuation figure to Heylo
- Client instructs solicitor and informs Heylo of solicitor details for passing over the Memorandum of Staircasing etc. to solicitor
- Heylo sends Memorandum of Staircasing to solicitor
- Solicitor completes conveyancing for client, Heylo and mortgage lender. Client may have to pay stamp duty which solicitor pays to HMRC on their behalf
Need Conveyancing Solicitors for your Heylo Your Home Staircasing?
Our conveyancing solicitors have extensive experience with completing staircasing for Heylo Your Home clients and can ensure that the process is carried out as efficiently and swiftly as possible.
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How does Staircasing differ for Heylo Your Home?
If your property has risen in value when you come to staircase, Heylo gives you 75% of any rise in value via a discount.
Example of how this works
Let's say you bought your initial 10% of a property through Heylo, originally for £20,000 (so full price is £200,000). You opt to buy a further 20% but your property has since risen in value to £300,000.
Technically, your additional 20% share, which would have been worth £40,000 when you bought the property, is now worth £60,000. So the increase in value for the 20% share is £20,000.
So you pay £40,000 plus 25% of the rise in value - because you're given 75% of it - which is £5,000, so the total you pay is £45,000.
Although technically Heylo allow you to buy any additional percentage value - for example 1% - you have to factor in the costs of staircasing, which include getting a RICS valuation, Heylo's administration fee, the required conveyancing and possibly stamp duty, each time you opt to do so.
What is the cost of staircasing with Heylo?
Although with Heylo you can staircase for an additional share as low as 1%, you should budget for the total cost of any staircasing process - not including the premium you'll have to pay for the extra share - to be in excess of £1,200.
Click to find out more about Staircasing Shared Ownership and its associated costs.
Staircasing and Stamp Duty for Heylo Housing Your Home
Depending on the size and value of the share you staircase to and other factors, you may have a stamp duty liability and have to make a payment to HMRC (or The Welsh Revenue Authority in Wales) on completion: your solicitor can advise you about this.
Click if you wish to find out more about Stamp Duty for Staircasing
Need Conveyancing Solicitors for your Heylo Your Home Staircasing?
Our conveyancing solicitors have extensive experience with completing staircasing for Heylo Your Home clients and can ensure that the process is carried out as efficiently and swiftly as possible.
* Fixed Fee – On all Mortgage Lender Panels - National Coverage - 5 Star Reviews
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