If you have previously purchased a new build property with the aid of Help to Buy (HTB) loan and are looking to repay the loan by using savings, further advance from your current lender or remortgage, we can help. We suggest that you contact us for a quotation on your repayment of HTB at this stage.

The HTB rules state that you do not need to repay the loan until the property is sold or the mortgage term comes to an end.  Many people decide to repay the HTB loan before then.

The first step to take in repaying the HTB loan is to contact Target HCA, which is the company that acts on behalf of the Homes and Communities Agency, that deals with Help to Buy.

The process of repaying a HTB loan requires:

1)  A valuation survey carried out by a RICS qualified surveyor to ascertain the current market value of the property. Please note the survey is valid for 3 months from the date it was produced. Therefore, if completion does not take place before the expiry date, a new survey will be required.

2)  You must complete an application form for Target, including your details, property details and solicitor’s details and pay Target a fee in the region of £200-£250 and clear any arrears of the loan.   If you are selling your property and repaying the loan, you will also need to send Target a copy of the Sales Memorandum from your estate agents

Target will send your chosen solicitor a redemption pack confirming how much is required to repay the loan, which will be a percentage of the value of the property.

If you are repaying the HTB loan from savings and your solicitor has received the redemption information, they will advise you of the amount due to repay the loan.

If you are repaying the loan by way of further advance or remortgage, once your Solicitors have received your lender’s mortgage offer and redemption information from Target, they will prepare a Completion Statement for you and request any funds they need from you to complete.

Before completion can take place, the solicitor will send a legal undertaking to Target confirming all the necessary details, including a completion date. Target needs to be satisfied that all the details in the Solicitors Undertaking are correct. They will then issue an ‘Authority to Complete’ which authorises the solicitor to send the money required to repay the loan.

Once the loan has been repaid, Target will send the Land Registry notification, and the second charge will be removed from the title of the property.

More information can be found on the following link Repay your Help to Buy: Equity Loan – GOV.UK (www.gov.uk)

This blog post is not intended to be taken as advice or acted upon. If you are seeking legal advice, please get in touch with our team of solicitors.