BLOGS

Do you have a Help to Buy Loan that you need to repay on your home?

The Help to Buy scheme was introduced to enable people to purchase a new home with only a 5% deposit. The government then make up the difference of 20%. The loan is interest free for 5 years but after this time, interest is payable.

Once the 5 years has passed many people are choosing to repay their loans.  To do this, you will need a conveyancer and Pardoes are here to help.

There are three ways that a Help to Buy loan can be repaid.

·         Lump Sum Payment: This figure could come from savings that you may have built up or have been given to you by a third party.

·         Further Advance: Sometimes, your lender will agree to a further advance (loan) you further monies to pay off the Help to Buy Loan. You would need to apply for this yourself or have a mortgage broker do so on your behalf.

·         Remortgage: If you are not able to get a further advance from your current lender, you will need to apply to another lender for a remortgage (for a sum which is enough to redeem your current mortgage and your Help to Buy Loan).

Once you have decided the best way forward, you will need to get your property valued by way of a RICS valuation. This valuation will need to be sent to Target (who deal with Help to Buy redemptions) along with an administration fee and details of the Conveyancer acting for you..

Target will generate a redemption figure and send this to your Conveyancer. Your conveyancer will need to submit forms to Target who will then issue an Authority to Complete. Once your Conveyancer has this, they will be able to repay the Help to Buy loan once they have confirmed how you will be funding it (from the 3 options above).

If you have queries in relation to repaying a Help to Buy loan please do not hesitate to contact Debbie Button, Legal Assistant by email to Debbie.button@pardoes.co.uk or telephone on 01823 446211 or for a no obligation quote, please call our residential team on 01823 446200.