If you want to remortgage your Help to Buy loan, there are a number of options open to you.
Remortgage and fully repay the equity loan
If you want to fully repay the equity loan, your new mortgage provider will need to make sure that you meet the necessary lending criteria. You will need to get your home valued by a certified surveyor who is a member of the Royal Institute of Chartered Surveyors. There may be terms and conditions; for example, some mortgage providers state that the loan to value must not exceed 90 per cent. There will be an administration fee payable to Homes England for redeeming the equity loan.
Repay part of the equity loan
If you want to repay part of the equity loan, you will need consent from Home England. The loan to value rate must not exceed 75 per cent and the minimum voluntary part repayment is 10 per cent of the market value of the house at the time of repayment.
Keep the equity loan
If you want to keep the equity loan, the loan to value must not exceed 75 per cent and the new loan must not exceed the existing loan with the current provider. The mortgage term must not exceed the term of the existing provider.
When it comes to remortgaging your loan, you will need to sort out the Target Help to Buy redemption. Target Servicing Limited, a private company that entered into an agreement with Homes England Help to Buy, manages many equity loans. It is there to deal with the customers of Help to Buy once they have finished the process of buying their home. Target deals with such things as collecting interest payments, sending out letters and statements, and one-off events such as handling the process when you want to repay your equity loan.
Completing the paperwork
When the time comes to complete the process of your Target Help to Buy redemption, you must complete the necessary documents. When you complete this paperwork, you need to supply your conveyancer’s contact details and give them the authority to act on your behalf. If you need to find a conveyancer to help you with this process, an online search will bring up companies such as Sam Conveyancing that will be able to provide lots of help and advice.
You will also need to find a chartered surveyor who is a member of the Royal Institute of Chartered Surveyors to help you establish the current market value of your home when you want to remortgage your Help to Buy loan, no matter which option you choose.