Help to Buy Remortgage – What You Need to Know

Navigating Your Options

For homeowners who purchased through the government’s Help to Buy scheme, approaching the end of a fixed term can raise questions about remortgaging. With the government owning a 20% equity share, remortgaging typically involves only the remaining proportion, excluding your deposit. This helps avoid moving onto your lender’s standard variable rate (SVR), which often comes with higher interest rates.

Is a Help to Buy Remortgage Possible?

While many lenders don’t offer specific Help to Buy remortgage deals, there are options:

1. Repay the Government’s Equity Loan: If you can raise funds to buy out the 20% share, this provides more freedom when choosing lenders and deals.
2. Staircasing: Gradually repay the equity loan in 10% value increments to reduce your debt and increase your home’s equity.

Benefits of Repaying the Equity Loan

• Avoid paying interest on the equity loan after five years.
• Gain access to a wider range of mortgage deals and lenders.
• Retain 100% of future property value appreciation.

Partial Repayment & Staircasing

For those unable to repay the loan in full, partial repayments (staircasing) can strike a balance by reducing the equity loan while making remortgaging more accessible. This approach requires an independent valuation of your property and adherence to strict timeframes.

Things to Consider

• Affordability Checks: Prove sufficient income for higher repayments.
• Loan-to-Value Ratio: Higher LTV products may have higher monthly payments.
• Administrative Costs: Fees and valuation requirements may apply.

How We Can Help

Our experts at The Mortgage Store Cheltenham & Gloucestershire can:

• Explore your remortgage options, including staircasing.
• Guide you through lender criteria and affordability checks.
• Find the best deal tailored to your circumstances.

Contact Us Today

Ready to explore your Help to Buy remortgage options? Get in touch with us to simplify the process and secure a deal that fits your needs.