Help to Buy: Paying Back Your Loan

Help to Buy repayment is the process when homeowners who used the Help to Buy Equity Scheme choose to pay off their loan, either by repayment from personal savings, another loan or a gift, by re-mortgaging or by selling the home.

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Many help to buy equity loans were managed by Target Servicing Limited, a company that had an agreement with Homes England to engage with the people using the Help to Buy scheme once they have finished the process of buying their home. Target dealt with such things as collecting interest payments and sending out letters and statements as well as one-off events such as handling the process when you want to repay your Equity Loan. If you want to look at the Target Help to Buy redemption, there are a number of options.

Completing the Paperwork

When you want 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 solicitor’s contact details and give them the authority to act on your behalf. If you need to find a solicitor who can help you with this process, you can look online for a company such as Sam Conveyancing, where you can find lots of help and advice.

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The options are:

Sell the Property and Repay the Loan in Full

If you sell the property that you took the loan out on, you will need to repay the loan in full. The amount you are required to pay is calculated as a percentage of either the current market value or the agreed sale price of your home, whichever is higher. The full amount of the loan has to e repaid regardless of whether the house has increased or decreased in value. You will need a RCIS valuation of the property, which you then send to Target and they confirm in writing if they agree with the valuation and say how much you need to repay the loan. The solicitor then handles the rest of the legal work to redeem the loan.

Keep the Property

You can also keep the property and repay the loan in full. This might be from personal savings or a gift or by arranging another loan or mortgage.

Staircasing

This is where you repay your loan in part, and you may do this without getting another loan or you may choose to get another loan with a different lender. The minimum amount allowed at each time is 10% of the market value of the property. You can only staircase in multiples of ten per cent.

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