Conveyancing: Repaying Your Help To Buy Loan
Do you have a Help to Buy equity loan that you need to repay upon sale of your home? Licensed Conveyancer Julie Stewart explains which steps you need to follow to repay your help to buy loan…
Customer Information Pack
Before you begin the process of repaying your loan, you should read through the latest “Customer Information Pack”. This can be found on the Government’s website here: www.gov.uk/guidance/how-to-repay-your-equity-loan-when-you-sell-your-home
The information on the website and within the Customer Information Pack will give you all the information you need, step by step guidance and the documents that must be completed.
Valuation
You need a valuation for your property to provide the current market value. This figure is used by Help to Buy to calculate the payment due back to clear the equity charge. The valuation must be conducted by a RICS Certified Surveyor and preferably a surveyor who has dealt with valuations of this type previously.
When discussing your requirements with your preferred Surveyor you must ensure that you give them a copy of the valuation requirements listed in the Customer Information Pack. The report will be provided to you and you should then send this within five working days of issue to:
Post: Help to Buy Customer Service team, PO Box 5262, Lancing, BN99 9HE
Email: customerservices@myhelptobuyloan.co.uk
You need to pay an administration fee of £200 when you apply to repay the equity loan and also clear any arrears or outstanding payments.
You will also need to send to Help to Buy a copy of the estate agent’s memorandum of sale confirming the agreed sale price.
When submitting your application form you will need to give details of your appointed solicitor and this then allows Help to Buy to contact your Solicitor with the relevant legal documentation.
Please note that the valuation is only valid for 3 months and if the loan is not repaid within 3 months of the valuation, you will need to provide Help to Buy with a further desktop valuation reconfirming the property value. If after the additional 3 months, the loan is still not repaid a further valuation will be required.
Help to Buy Repayment Application
Your application will be processed and you will then receive a repayment letter. This will include any arrears and interest. The redemption letter provides permission to repay the equity loan, the percentage that you are required to repay and the amount of the repayment based upon the valuation report obtained.
Your Solicitor will also be sent the legal pack providing details of the items to be supplied by the Solicitor when requesting final authority to complete the redemption. The Solicitor must make several formal undertakings to Help to Buy within the request for final authority to complete and specify the date upon which the sale and associated redemption will take place.
This formal letter of undertaking must be sent to Help to Buy 15 working days before completion and forms a binding promise to repay the loan on the date given.
Once Help to Buy have received the Solicitor’s undertaking they will issue the Authority to Complete and this confirms that the loan can be repaid on the date given. The Solicitor will not exchange contracts on your sale and also cannot repay the equity loan without the Authority to Complete being in their possession.
On completion of the sale and redemption of the equity loan taking place your solicitor will send the correct funds to Help to Buy to repay the loan. Help to Buy will then release the charge from the Land Registry and the entry will be removed. Please note that this stage can take many weeks for Help to Buy to process.
How Can Timms Help?
If you would like further information, please contact myself or one of the conveyancing team on 0800 011 6666.
November 2023