If you bought a new-build home with a Help to Buy equity loan, chances are you’ve been enjoying lower monthly payments for the past few years. But as time goes on, many homeowners start to think about the next step — and for a lot of people, that means remortgaging and repaying the Help to Buy equity loan.
Let’s break down how it all works and what to consider when the time comes to remortgage and repay your Help to Buy loan.
How the Help to Buy Equity Loan Works
The Help to Buy scheme, introduced by the government, made it easier for first-time buyers to get on the property ladder by providing an equity loan of up to 20% of the purchase price (or 40% in London).
Here’s a quick reminder of the key points:
✔ You needed a minimum of a 5% deposit.
✔ The government provided between 20% – 40% as an equity loan.
✔ You took a mortgage for the remaining amount.
✔ The first 5 years of the equity loan are interest-free.
✔ After year 5, you pay monthly interest on the loan (but not the capital).
✔ The amount you repay is based on the property’s current market value when you clear the loan, not what you originally borrowed.
Why Remortgage to Repay Your Help to Buy Loan?
There are several reasons why many homeowners choose to remortgage and clear their equity loan:
Avoid paying interest: After the initial 5 years, you start to be charged interest on your Help to Buy Equity Loan. Repaying it avoids this ongoing cost.
More control over your home: Clearing the loan means the government no longer owns a percentage of your property.
Potential to increase mortgage options: Many lenders do not accept mortgage applications if your Help to Buy Equity Loan is remaining outstanding. By remortgaging and repaying the equity loan, you may be able to access more mortgage deals.
House price increases: If your property value has increased, the amount you owe on the equity loan will have risen too. Many want to repay before prices climb further.
The Remortgage & Repayment Process — Step by Step
Here’s what to expect if you’re thinking about remortgaging and repaying your Help to Buy loan:
- Speak to a Mortgage Broker (Like Us!)
The process can feel overwhelming, but it doesn’t need to be. Start by getting advice from a mortgage advisor experienced with Help to Buy remortgages. We’ll guide you through your mortgage options, submit your mortgage application, and suggest solicitors who are familiar with the Help to Buy redemption process – having the right team in place makes a real difference.
- Get a Valuation
You’ll need a formal RICS valuation to determine your property’s current market value. This is used to calculate how much you’ll need to repay on your equity loan.
- Submit the Paperwork to Help to Buy
Once you have your valuation report, you’ll need to complete a Help to Buy repayment application form, send it off along with the valuation, and pay the admin fee. Help to Buy will then issue your formal redemption letter, which confirms exactly how much is needed to repay the equity loan.
- Redeem the Equity Loan
Once your mortgage offer is in place and you’ve received your redemption letter, your solicitor will handle the legal side. They’ll coordinate everything so your current mortgage and Help to Buy equity loan are redeemed. Completion usually coincides with the end of your existing mortgage deal.
Common Questions We Get Asked
“Can I remortgage before the 5-year interest-free period ends?”
Yes, you can – many choose to do this before their house value increases too much in order to limit the amount repayable.
“What if my property has dropped in value?”
You’ll still repay based on the current market value, even if it’s lower than when you bought.
“Can I remortgage without repaying the Help to Buy loan?”
Yes, but not all lenders accept a remortgage application if the equity loan is remaining outstanding. You will also require permission from Help to Buy. An experienced mortgage advisor can guide you through the options.
Why Local Help Matters
If you’re in Brackley, Radstone Fields, Field View, or the surrounding villages, working with a local mortgage broker can make a real difference.
We know the area. We understand the local property market. And we regularly help homeowners here remortgage and repay their Help to Buy loans – so you’re in safe hands.
Ready to Explore Your Options?
Whether you’re coming to the end of your interest-free period, or you just want to plan ahead, getting advice early is key.
We’ve helped plenty of Brackley homeowners from Radstone Fields and Field View remortgage and repay their Help to Buy equity loans with minimal stress as possible.
Book a free, no-obligation chat today, and let’s see how we can help you take the next step with confidence.
There may be a fee for mortgage advice. The precise amount will depend upon your circumstances but we estimate it will be £499.
