How To Repay Your Help To Buy Loan And Remortgage

The Help to Buy scheme was launched in 2013 to aid property purchases with a government loan. Millions have benefitted from this scheme, and now it’s time to learn the steps to repay your loan.

Understanding the Help to Buy Equity Share Loan

When you initially bought your property, you secured a government loan representing a percentage of the property’s value at that time. Now, for repayment, you need to pay back the original loan amount along with any share of the property’s increased value.

Repayment Amount May Exceed the Borrowed Amount

Keep in mind that your repayment will be based on the property’s current market value. So, the amount you repay may be higher than the initial loan you received. However, if the property’s value hasn’t increased or has decreased, you might not need to repay more than the original loan amount.

Getting a Surveyor’s Valuation Report

To proceed, Help to Buy requires the services of an RICS (Royal Institution of Chartered Surveyors) qualified surveyor. Before contacting the surveyor, make sure to disclose any factors that could impact the property’s value, as approval (of the surveyor by Help to Buy) might be necessary. Factors like external cladding, planning permission breaches, or building regulations could affect the valuation.

Validity of the Valuation Report

The surveyor’s valuation report remains valid for 3 months from its production date. Make sure Help to Buy receives the valuation within 5 working days of its issue date. If the report expires before you repay your loan, you may need a ‘desktop valuation’ to extend the validity by 3 months.

Confirm the Source of Repayment Funds

Help to Buy needs to know where your funds for repayment will come from to comply with anti-money laundering regulations. Whether it’s a top-up to your mortgage or other means, provide proof of your repayment source.

Written in August 2023 by:

Sam Chester

Appoint a Solicitor

You’ll need a solicitor to remove Help to Buy’s legal charge on your property if you’re repaying the loan in full. A single solicitor can handle the entire transaction, including dealing with the lender and managing Help to Buy.

Visit our conveyancing section for a free quote!

Paying the Administrative Fee

Help to Buy charges a £200 administrative fee when applying to repay your equity share loan. Ensure you clear any arrears or outstanding payments as well. Complete the loan repayment application form and provide the required evidence and documents.

Fees can be paid by either:

online bank transfer
debit or credit card by calling 0300 123 4123
cheque

You will also need to complete an application form which can be found here

Send them by either email or post to:

Email customerservices@myhelptobuyloan.co.uk

Post: Help to Buy Customer Service team, PO Box 5262, Lancing, BN99 9HE

You must provide your solicitor’s contact details and give the solicitor authority to act on your behalf.
Your application cannot progress until you have:
Sent the RICS valuation report.
Paid the administration fee and any arrears.
Completed and sent your application form.

Receive the Redemption Letter

Once you’ve submitted the necessary documents, Help to Buy will send you and your solicitor a redemption letter. This letter will confirm your original loan percentage (maximum of 20%) your eligibility to repay the equity loan and specify the repayment amount, including interest, fees, and arrears. In addition to this, your solicitor will receive a list of items to include in a ‘legal undertaking’ which is a formal legal agreement.

Repay the Equity Share Loan

After receiving the redemption letter, you’ll be sent an ‘Authority to Complete’. This indicates you can now repay all or part of your equity loan to complete the repayment process.

Completion Process

Your solicitor will transfer the funds to repay your equity loan, including all applicable fees and arrears. Once the process is complete, Help to Buy will apply to the Land Registry to remove the charge on your property. If you’re paying monthly interest and management fees, continue doing so until the process is complete.

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Attention Please!!!

The content within this article is as accurate as the date it was written. To ensure the most up to date information, you should consult with one of the experts that we work with as every lender and their polices are different and can be changed or amended without notice.

This website is for information only and does not constitute financial advice. Our mortgage advisers are all fully qualified to provide mortgage advice in accordance with the Financial Conduct Authority (FCA) regulations. We only exclusively operate with businesses that are authorised and regulated by the FCA. All advice offered will be unique to your individual circumstances.

Some Buy to Let mortgages are not regulated by the FCA. You should carefully consider securing other debts against your home. If you do not keep up your mortgage repayments, your home may be repossessed. Equity released from your home will also be secured against it.