REMORTGAGING HELP TO BUY
In April 2013 the government launched its biggest intervention into the housing market since the 1980s - the Help to Buy scheme. The scheme was initially launched with the aim to give first-time buyers a leg-up to the housing market, however currently it is open to homeowners as well who are looking to move. So far, Help to Buy has given hundreds of thousands of home buyers the chance to purchase their first home or the opportunity to move to a bigger property.
We are now 6 years into the scheme, and with more and more people either approaching the end of their initial mortgage term, or coming up to the 5 year anniversary to start making interest payments on the loan - it means these people are now faced with the prospect of higher monthly outgoings unless they take action.
PAYING BACK THE HELP TO BUY EQUITY LOAN
You can pay off the equity loan at any point, paying either 50% or 100% of the outstanding equity loan sum, however when doing this it will usually incur a fee. In London where the HTB loan is up to 40% of the purchase price you are able to pay off 10% increments of the equity loan.
The government require the loan to be paid off in by a cash lump sum these can include a gift, inheritance, saving, bonus or through remortgaging.
Remortgaging to pay back the help to buy equity loan is the most common way to pay off the loan for most people, however the process is not as straight forward as a general Remortgage. Even finding the right lender can be more difficult as not all lenders will accept remortgage applications to pay off the Help to Buy loan, and those that do have additional restrictions regarding the amount equity that is in the property.
However this is where we can help…..here at Mortgage Light we are specialists in Help to Buy mortgages and remortgages, and with access to the whole of the market we can hand hold you through the process every step of the way.
- Set a time to speak to Mortgage Light Remortgage Team
- Mortgage Light will do all the do relevant checks to ensure the Remortgage is affordable, and then upon receipt of relevant documentation from yourselves we will be able to provide you with an AIP/DIP
- Instruct a RICS Valuation, you will need to pay for this upfront – don’t worry Mortgage Light can advise you how to do this.
- Mortgage Light will submit your application to the lender
- Appoint solicitor – Mortgage Light can help by providing you with details of specialist solicitors who deal with Help to Buy Remortgage.
- Valuation will be instructed by the lender
- Contact Help to Buy to advise them that you wish to repay the equity loan, they will then send a upto date loan settlement figure to the solicitor. Again Mortgage Light can advise you how to do this.
- The documentation that the lender requested will be assessed
- The mortgage offer will be issued and a copy sent to yourselves and your solicitor
- Set a time to meet or speak to Mortgage Light to review your mortgage offer and discuss your protection needs.