Help to Buy LTV Help

dimbo61

Any lender will calculate the LTV on the value of the property against the outstanding debts on the property.

NYA2017

If anyone's interested, I got in touch with Halifax and they said that they calculate LTV at full market price value, and that to pay off HTB you can borrow up to 85% of the property's value. All lenders are different, but this is good news to what I was asking as they don't base it on the 80% equity you own but full 100%.

Grezz24

you always own 100% of the home in a help to buy scenario. you just take a loan from the govt which you have to pay back at 20% of the property value

getmore4less

dimbo61 wrote: »

Sorry Kingstreet I stand corrected.
However I am deeply concerned about HTB with many buyers of new builds facing a big increase in mortgage and HTB loan payments after 5 years while having sometimes 95-100 percent LTV

Worst case it is a deferred 1.75% interest interest only on the original 20% loan

This will already be lower than the 75% LTV rate they got in the first place.

if Interest rates go up its going to look even better.


It would have been easy to built this in if they could.
Take the mortgage over a longer term and overpay by at least the amount needed to cover the interest in 5 years.

In the often example used £200k £150k mortgage, £10k deposit, £40k HTB

£40k @ 1.75% is just under £60pm

£150k over 25y @ 2% £636
£150k over 30y @ 2% £555

Along with the savings from the better HTB rate there is plenty in the pot to overpay and not come unstuck in 5 years.

If the house has gone up then that 1.75% on the original loan is going to look VERY cheap against trying to capitalize it into the mortgage at current value.