Help To Buy Equity Loan Property Extension

silvercar

HTB is possibly too new to give you a definitive answer.

On the face of it, if you do an extension without consent you will be in breach of the HTB terms. So the HTB provider would be within their rights to call in the loan.

At worst they could make a very poor (or no) allowance for the money you put in.

It shouldn't effect the sale, as it is the property you would be selling not the HTB facility, but it could delay a sale while you argue over the percentage and a buyer could lose patience and go elsewhere.

SuboJvR

If you love the house, but don't want to be cash poor, and want to proceed with the Help to Buy...

Then why don't you bank the cash, continue saving, and latterly "buy out" the Help to Buy portion whether that be from savings or re-mortgaging? Accepting that the Help to Buy portion may well have gone up in value. Then do your extension.

Alternatively could you not go for a different plot which is larger, still use Help to Buy but not need to do the extending?

moneytorques

If I can prove it is self funded is there a protocol in place to have the house valued pre work to avoid the percentage being affected in a negative way?

kingstreet

From the Target site I linked to earlier;-

By home improvements we mean significant structural changes to adapt your home for a disability. Under the terms of your loan certain types of home improvement are not permitted. If you wish to discuss what home improvements may be permitted, please contact the Customer Service team.

Decorating, kitchen/bathroom re-fitting, solar panel installation or window replacements are not considered home improvements and are permitted without our approval.

The restriction on home improvements does not apply to adaptations to the property required by an owner with a disability or family member living there. If such work is required, you will need to contact us to discuss the next steps.

To support any home adaptations for the purpose noted above, you will need to provide evidence that is necessary. This could be by supplying a General Practitioners (GP) letter, or third party medical evidence.

If you do decide progress this type of application you will be required to pay an administration fee, listed in the tariff of charges. It is suggested you contact us to discuss your case before progressing.

moneytorques

kingstreet wrote: »

From the Target site I linked to earlier;-

King street, I've seen this however it is ambiguous in that it is referring to Disability works only.
It appears that my circumstances aren't really covered by this attempted catch all statement.

The fact the H2B element is proportional to the value of which I want to increase should mean they agree with it as its providing the Government a better return also.
I expect 50k of work to add 100k in value over 5 years and potentially adding 10k to the H2B element.

Unchatered territory I believe.:mad:

kingstreet

It does deal with improvements of a non-disabled nature;-

Under the terms of your loan certain types of home improvement are not permitted. If you wish to discuss what home improvements may be permitted, please contact the Customer Service team.

Why not take their advice and call and ask?

silvercar

moneytorques wrote: »

The fact the H2B element is proportional to the value of which I want to increase should mean they agree with it as its providing the Government a better return also.
I expect 50k of work to add 100k in value over 5 years and potentially adding 10k to the H2B element.

Unchatered territory I believe.:mad:

The idea of HTB is that you repay the loan, enabling other people to benefit from the same deal you were able to obtain. The intent is that you prioritise repaying a loan over building an extension.

Uncharted as HTB is new and most are trying to repay loans before an interest rate hike, rather than build extensions.

If 50k of work adds 100k of value, then 'losing' 20% of it would mean you only gain 80k for your 50k spend. As galling as it would be (that the HTB percentage wasn't reduced) could you cope with that 30k gain?
The risk is that the extension comes to light and your HTB loan is called in - what would you then do without the savings to repay it? I suppose if you were supremely confident of the rise in value and you had the income to support an increased mortgage, you could remortgage to a level to remove the HTB loan.

moneytorques

kingstreet wrote: »

It does deal with improvements of a non-disabled nature;-

Under the terms of your loan certain types of home improvement are not permitted. If you wish to discuss what home improvements may be permitted, please contact the Customer Service team.

Why not take their advice and call and ask?

I did, and what I was told didn't feel me with confidence, "any works needing planning permission would need to go through the Local Authority, these are nothing to do with us"

moneytorques

Weve decided to proceed and see how the home is to live in for a while, happy days!

moneytorques

Ok, so having lived in the home for a few months weve now made an enquiry via email to Target HCA about the feasibility of an extension. Its been over 3 weeks and no reply! We were thinking of writing to them and stating that unless we receive a response to the contrary we take it as acceptance of the plan without determent to the valuation of the property when settling the loan.

6 months on has anyone else encountered Target HCA on a communications level?