Providing expert mortgage advice for over 28 years.
Providing expert mortgage advice for over 28 years.
The Help to Buy: Equity Loan scheme was a government-supported programme that ran from 2013 to 2023, aiming to help first-time buyers purchase newly built homes. With this scheme, buyers could purchase a property with a deposit of only 5%.
The government gave an equity loan of up to 20% of the property’s value. In London, it was up to 40%. This loan did not have any interest for the first five years. The rest of the amount was paid for through a mortgage.
The equity loan needs to be paid back when you sell your property or when the loan term ends, which is usually 25 years. The amount you repay is based on the market value of your home at that time, not on the original loan amount.
When you remortgage, you are changing your current mortgage deal for a new one. This can be with your current lender or a different one. Usually, this means you get a new mortgage for your property. The money from this new mortgage pays off your old one.
People decide to remortgage for many reasons. They might want a better interest rate, access equity in their home, or combine debts. When you remortgage, you have to complete an application process that is like the one you did when you got your first mortgage. This includes sharing your financial details and going through a credit check.
It’s important to look closely at the terms of the new mortgage deal. You should also think about any fees that come with it. Do this before you decide to remortgage. This will help make sure it fits your financial goals and situation.
Yes, when your first Help to Buy mortgage deal finishes, usually after a fixed period of 2-5 years, you can remortgage. If you do not remortgage, you will move to the lender’s standard variable rate (SVR). This rate is usually higher and will mean increased monthly repayments.
Remortgaging lets you get a new mortgage deal. This may come with a lower interest rate, which can lower your monthly mortgage payments. It also gives you a chance to pay off your equity loan or include it in your new mortgage.
After the first 5 years without interest, you will pay interest on the equity loan. The interest rate starts at 1.75%. Each year, it will increase based on the Retail Prices Index (RPI) plus a set percentage.
It’s important to check the specific terms of your agreement, as the details may vary depending on when you entered the scheme.
You will have to start paying back the equity loan when you sell your home or after 25 years, whichever happens first. It is a good idea to plan for these changes. This will help you be ready for the costs of the equity loan once the 5-year interest-free period is over.
The steps to remortgage with Help to Buy are as follows:
Remember, if you are remortgaging with Help to Buy, there are extra costs and things to think about. It’s important to look at both the good and bad sides closely. Talking to a mortgage broker can help you make a smart choice that fits your long-term financial plans
At Newhomes, we specialise in Help to Buy remortgages and offer personalised advice to help you make informed, confident choices.
At Newhomes, we know how important it is to make smart choices about homeownership. If you want to learn about remortgaging with Help to Buy, or if you are unsure if it fits your needs, feel free to reach out to our expert advisors. You can also contact our customer service team for personalised help.
If you are thinking about remortgaging with Help to Buy, it is important to collect information. This will help you make a good choice. Here are some next steps and extra resources to guide you through the process:
By following these next steps and using the resources you have, you will be ready to handle the remortgaging process. This will help you make the best choice for your financial situation.
Remortgaging on Help to Buy is a big financial choice. It is important to think about the good and bad things before you decide. With the right help and advice, you can make a smart choice. This choice should fit your goals and your financial health in the long run.
Contact us today to discuss your Help to Buy remortgage. Call us at 01543 629 077 or reach out to our Existing Client Advice Team for expert, personalised guidance. We’re here to help you make informed, confident decisions about your financial future.
