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Help to Buy Valuations

We offer Help to Buy valuations for people who wish to repay their Help to Buy loan or sell their Help to Buy property.

Help to Buy loans were introduced by the government in April 2013 with the aim of helping first-time buyers get on the property ladder. A Help to Buy loan can provide up to 20% of the value of the property (or 40% in London) to the buyer interest free for the first five years of the loan period.

However, after the initial interest free period, an annual interest rate of 1.75% is applied to the original loan amount and must be paid monthly on an interest only basis. Then the interest rate increases further by the Retail Price Index (RPI) plus 1.0% every consecutive year. This means that at the end of a Help to Buy loan term of twenty-five years the real terms interest rate far exceeds mortgage rates which are currently available. As the original Help to Buy loan relates to a percentage of the equity in the property, the loan amount also increases in line with house price growth.

Over time, according to your means, you may be able to buy additional shares in the property. This is called ‘staircasing’. You can make partial repayment of your Help to Buy loan in segments of 10% or repay the full loan, known as ‘Full Redemption’. There are three main benefits of staircasing:

  1. You will own up to 100% of the property, rather than just 80% of it.
  2. You will not have a growing equity payment to make.
  3. The money that you pay every month will contribute to paying your mortgage rather than to simply pay the interest on the Help to Buy loan.

If you sell a property which is subject to a Help to Buy loan, the Help to Buy scheme providers will insist that you provide them with an independent valuation of your property carried out by an RICS accredited valuer.

As specialist Valuation Surveyors we can provide the necessary RICS valuation of your property in the correct format for your Help to Buy loan provider.

Help to Buy Valuations FAQs

Can I repay all of my Help To Buy loan?

It is possible to pay of all of your Help to Buy loan in one go, which is often called Full Redemption. This can be done by increasing your main mortgage or by paying the loan off with cash, say from an inheritance. An independent RICS valuation survey must be carried out.

What do I need to do if I have a Help to Buy loan and want to sell my property?

When a property bought with a Help to Buy loan is put on the market you will need to provide the Help To Buy provider with an independent RICS valuation report before the sale can exchange contracts.

Can I use a mortgage valuation to give to my Help to Buy provider?

Unfortunately, you cannot use your mortgage valuation. Your Help to Buy loan provider will require you to arrange a completely independent RICS valuation report that is produced to a different specification than a standard Mortgage Valuation or HomeBuyer Report.

Talk to us

If you would like to discuss a possible Help to Buy valuation, please contact us on 01903 872211 or via email on info@jwsurveyors.co.uk.

Contact us