Help to buy equity loan redemption

archie.way

Does anyone have any experience of Target HCA extending their help to buy equity loan term by more than 8 years?

phoenix9

archie.way said:

Does anyone have any experience of Target HCA extending their help to buy equity loan term by more than 8 years?

Huh? I’ve just sold a house that had an equity loan - doesn’t it run for the term of the first charge mortgage? 

kingstreet

HTB loan must be repaid on/before first charge.

So, it's 25 years, on sale of property, or at end of the first mortgage - whichever comes first.

chanz4

kingstreet said:

HTB loan must be repaid on/before first charge.

So, it's 25 years, on sale of property, or at end of the first mortgage - whichever comes first.

Im doing it at the moment, is it better to sell the property and then pay off or pay off the loan first?

kingstreet

chanz4 said:

kingstreet said:

HTB loan must be repaid on/before first charge.

So, it's 25 years, on sale of property, or at end of the first mortgage - whichever comes first.

Im doing it at the moment, is it better to sell the property and then pay off or pay off the loan first?

If you pay it off before selling, the redemption figure is based only on the RICS valuation. If you redeem during a sale, the redemption figure is the HIGHER of the RICS valuation and the agreed sale price.

Archiewayz

Let me clarify..

Bought house in 2017 with 35 year mortgage and 20% help to buy equity loan over 25 years.

Trying to remortgage now to move 10% of equity loan to mortgage. Bank has said affordability only works if it is over 32 years and stipulated that Target help to buy need to agree to match the equity loan term to the new mortgage.

Target have said they will increase the equity loan term by 8 years but I effectively need it increasing from 20 years currently to 32 years so 12 extra years.

Has anyone had any experience of having problems partially redeeming help to buy equity loan or bank insisting on the two terms being the same?

Do they really have to be for the same term?

I'm stuck between the bank and Target and currently unable to remortgage as the bank won't issue a new mortgage offer without Target's written confirmation to match the term.

Any help would be gratefully received. This process is painful. I thought it would be easier staying with the same lender...

kingstreet

They are not usually for the same term. We've been doing mortgages for upto 40 years since 2014 when the scheme started.

The HTB EL term is the shorter of 25 years and the point the first charge is repaid either from a sale or a voluntary redemption.

chanz4

kingstreet said:

chanz4 said:

kingstreet said:

HTB loan must be repaid on/before first charge.

So, it's 25 years, on sale of property, or at end of the first mortgage - whichever comes first.

Im doing it at the moment, is it better to sell the property and then pay off or pay off the loan first?

If you pay it off before selling, the redemption figure is based only on the RICS valuation. If you redeem during a sale, the redemption figure is the HIGHER of the RICS valuation and the agreed sale price.

we want to buy have the cash in the bank to pay off the htb, but just wondering whats best from a new mortgage point of view