How to redeem your Help to Buy: Equity Loan
Whether you've bought a home with a Help to Buy: Equity Loan or are just looking for information on what happens after purchasing with the loan, this blog will give you an idea of what to expect.
My First Home is the website for the Post-Sales Agency, run by a company called Target. They manage your Equity Loan following purchase and deal with any changes you want to make to this. They also deal with previous loan schemes such as FirstBuy, HomeBuy Direct and the First Time Buyers Initiative. They don't just deal with loan redemption either, they can help if you're looking to change mortgage details too!
Redeeming your Help to Buy: Equity Loan and selling your property
If you have an offer on your property that you're going to accept you will need to have the property valued by an independent surveyor. The valuation you receive will inform how much is required to pay back the loan. Target will need to be informed in writing when you have instructed the surveyor and the amount of the offer from the new purchaser you've received. They will then ask you to confirm details of the solicitor acting on your behalf for the sale of your property.
If the valuation is approved, Target will confirm the amount required to be repaid on the Equity Loan. Remember, your loan is up to 20% of the value of the home, so you would pay back 20% at the time of the new valuation/sale.
For example, if you purchased your home for £200,000, the 20% Equity Loan borrowed was £40,000. If your home is now valued at £250,000, the loan amount you pay back is now £50,000. However, it is still the same percentage, so you will still benefit from the increase in value/equity with your 80% owned.
You also need to be aware that if the sale price and valuation price are different then the repayment amount will be based on the higher value.
Keep in mind that you may have solicitors or estate agents fees you will need to pay as well as an administration fee payable directly to Target.
Redeeming your Help to Buy: Equity Loan and not selling your property
Similar to the above, you will need to have your property valued by an independent surveyor. Once you have received your valuation report you will then need to send it to Target with the details of your solicitor.
If they approve the property valuation they will write back to you with the amount required to repay the Equity Loan, and will liaise with your solicitor.
Again you will need to bear in mind solicitor fees and Target's administration fee.
There's no time limit on when you can begin the process of redeeming your loan. You'll also need to be aware that if you move home, you cannot take your loan with you; it was applied to the original purchase only and would need to be repaid on sale of that home.
For more information on redeeming your Equity Loan or any other post-sale questions please visit
My First Home.
If you have any other questions about the Help to Buy schemes please feel free to call us on 0800 456 11 88 or email us at firstname.lastname@example.org
Call 0800 456 11 88 or My First Home