So, you may have seen our previous blog and video giving you some advice about when is the best time to pay off your Help to Buy loan, but you may also be wondering just how you go about doing so.
Whether you’re wanting to avoid those potential hefty interest charges, or perhaps you’ve just decided now is the right time, our step-by-step guide will provide clarity on how you tackle this potentially daunting issue.
Although you don’t have to pay off the loan early, it can often work out better to clear it as early as possible. Not only do you save on interest, but with house prices continually on the rise, you’ll owe the government more if your properties value increases whilst you still have the loan. The Help to Buy loan scheme has helped thousands of first-time buyers get on the housing ladder, with the benefits clear for all to see.
But paying off the loan can sometimes be a bit of a grey area, with many inexperienced homeowners unsure of what steps to take.
Thankfully there are just 3 steps to take, and Warrington Mortgage Centre can help with them all.
- Your equity and affordability must first be assessed. This is done by a RICS (Royal Institution of Chartered Surveyors) approved surveyor, and it will include a two-page report with your current house market value.
- Following the return of the report, it needs to be cross-checked by the HTB company, who will then send us a redemption figure, a final figure for settling your loan.
- Using this figure, we help to find you a new lender (or keep the current mortgage lender if you’re happy). As long as the affordability and new numbers can be met, then you’ll be loan free.
It is worth noting before deciding to pay off your loan, that there are some charges involved. You’ll have to determine, especially if you’re only paying off part of the loan, whether it’s worth the extra fees.
You can expect to pay anywhere around the following for;
- A RICS survey fee of £150-200
- Solicitor’s fees of £75-100 + VAT minimum
- Help to Buy Administration Fee – £200
Of course, this will have to be budgeted on top of your loan repayment, so make sure you can afford everything before you commit. Our team of experts have years of experience in the industry and know the ins and outs of the Help to Buy loan market.
In essence, we do the hard work so you don’t have to, sorting out the RICS survey, the solicitor’s fees as well as your paperwork, allowing you to get on with everyday life, safe in the knowledge that your HTB loan is soon to be a thing of the past.
If you’d like any more information on a Help to Buy loan, or you’d like to start paying it off, then we’d be happy to help. Give us a call on 01925 573328 and one of our friendly team will be able to point you in the right direction.