Remortgage with or without help to buy equity loan?

swyoda101

Hello, I bought a new build house some years back with the help of the government's scheme help to buy equity loan.

The equity loan was £44K (20%) at the beginning. From year 6 onwards, I have been paying the monthly instalments for the equity loan which is interest only and doesn't count towards the loan. 

The house price currently is in the range of £280-£300K and the 20% amount will be in the range of £56K - £60K. My current bank mortgage is around £101,912.

I don't have the savings to pay off the equity loan in full by myself but I'd like to use some of my savings along with borrowing more from the lender at the time of remortgaging process. 

I bought this house by myself before getting married and I have gone through the divorce process which was concluded recently. The financial settlement is still remaining as I was not able to get hold of my ex-partner during this whole process. It was a short childless marriage where my ex-partner lived in this house with me for roughly 3 months. The mortgage and title deeds have my name from the beginning and I have been paying the monthly instalments since then. 

My confusion is - Should I pay off the HTB equity loan (20%, £56K-£60K) via remortgage (and savings) OR not? If my partner comes in the future for financial claim for the house, the 20% of the equity that government owns right now will be included in the house mortgage if I pay off via the remortgage (and savings). I'm not sure how the claim will be concluded if it goes to the court in the future whether the 20% ownership will become part of the sharing pot or not. 

Any guidance will be much appreciated. If not on the legal side, just on the HTB equity loan pay-off topic will be great too, thank you! 

silvercar

How does the interest rate on the HTB compare to the interest rate you would get on a new mortgage?

personally, I would want to sort the finances on the divorce as quickly as possible. Whereas a short childless marriage where you’ve only lived together in the house for a few months sounds like a zero chance claim, I’d want to close that door before anything else.