Remortgage and Help to Buy (Target)

Baremassive

Has anybody recently had to remortgage and pay off their help to buy with target? I’m trying to find the best way to go about this, I’ve been in touch with L and C and they didn’t really give me much advice in relation to the Help to Buy. 

My mortgage is due to expire at the end of February 24. I currently pay £800 per month at 1%, £253000 (30 years left) left on a property now valued at £500,000. 

The property was purchased in October 2019 so I believe I start paying interest on the H2B loan (£76990) from October 2024 (I think it’s after five years?) of £112 per month. 

My question to the advisor was basically what’s going to be the best option:

Option A - remortgage for £353,000 borrowing the extra £100k to pay off the H2B (20% of house value now) - coming out at around £2000 per month 

Option B - remortgage at £253000 left at around £1400 per month and start overpaying the difference into H2B (not sure if this is possible?) as the interest rate on the H2B is a lot lower than current mortgage rates.

Are there any H2B mortgage specialists that I’d be able to contact? If anybody has any help or advice it would be much appreciated.

Thanks

kingstreet

Target lost the contract for post-sales HTB on 16/06/2023. It's now Lenvi, IIRC.

You can only pay off a HTB loan in full, or in chunks of 10% of the property value. If you want to make voluntary overpayments monthly you'll have to reduce the mortgage or keep them in savings.

If your property is not currently increasing in value, you may not wish to redeem the HTB loan at this time as the interest rate (1.75% in year six) is considerably lower than the equivalent mortgage rate today.

Keep it under review and try to time your redemption correctly with interest payment rises and property values. No-one can advise you on this professionally as there's an element of subjectivity different from one person to another.

Baremassive

kingstreet said:

Target lost the contract for post-sales HTB on 16/06/2023. It's now Lenvi, IIRC.

You can only pay off a HTB loan in full, or in chunks of 10% of the property value. If you want to make voluntary overpayments monthly you'll have to reduce the mortgage or keep them in savings.

If your property is not currently increasing in value, you may not wish to redeem the HTB loan at this time as the interest rate (1.75% in year six) is considerably lower than the equivalent mortgage rate today.

Keep it under review and try to time your redemption correctly with interest payment rises and property values. No-one can advise you on this professionally as there's an element of subjectivity different from one person to another.

Thanks for your advice, I wasn’t aware of the 10% rule. My thinking is to just remortgage with my OS balance now and then set aside my “overpayments” ready to pay off in 10% instalments, then hopefully at some point in the future I’ll add it back onto my mortgage when/if rates get more towards 3%. 

chanz4

personally agree leave htb there

RogerPensionGuy

Baremassive said:

Has anybody recently had to remortgage and pay off their help to buy with target? I’m trying to find the best way to go about this, I’ve been in touch with L and C and they didn’t really give me much advice in relation to the Help to Buy. 

My mortgage is due to expire at the end of February 24. I currently pay £800 per month at 1%, £253000 (30 years left) left on a property now valued at £500,000. 

The property was purchased in October 2019 so I believe I start paying interest on the H2B loan (£76990) from October 2024 (I think it’s after five years?) of £112 per month. 

My question to the advisor was basically what’s going to be the best option:

Option A - remortgage for £353,000 borrowing the extra £100k to pay off the H2B (20% of house value now) - coming out at around £2000 per month 

Option B - remortgage at £253000 left at around £1400 per month and start overpaying the difference into H2B (not sure if this is possible?) as the interest rate on the H2B is a lot lower than current mortgage rates.

Are there any H2B mortgage specialists that I’d be able to contact? If anybody has any help or advice it would be much appreciated.

Thanks

HTB to one side for now.

Your current monthly payments is £800 on a 253K mortgage at 1% than ends in February 2024.

If you took out a new mortgage deal today, what interest % can you get and what will the monthly cost?

I would understand the 253K mortgage costs and then deal with the HTB at only 1.75% when the main mortgage is accounted for.

Also, what do you expect HTB % rate to be in these next five years say?

Mekerz86

Also good luck in trying to do anything via Lenvi/HTB - do some Googling and you'll see they're the most awful company to deal with. It has been over three months now since Lenvi have had my money (repaid my equity in cash) and they've still not released the charge from the Land Registry.

People selling property with HTB against it have literally had their purchase fall through because Lenvi can't even do the simple thing of giving authority to complete.