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Help to buy equity loan

OVERVIEW

The HTB equity loan scheme is only available for new build properties.

The new Equity Loan scheme was launched on 1st April 2021 its aimed for First Time buyers in particular and includes regional property price limits to ensure the scheme reaches out to the people it was intended to do.

Please see table below.

REGION

FULL PROPERTY PRICE LIMIT

East

£407,400

East Midlands

£261,900

London

£600,000

North East

£186,100

North West

£224,400

South East

£437,600

South West

£349,000

West Midlands

£255,600

Yorkshire and The Humber

£228,100

The Government will lend you up to 20% (40% London) of the cost of your brand new home mean you only need a 5% deposit and 75% mortgage.

The equity loan is Interest free for the first 5 years after which a fee of 1.75% will be charged and paid monthly which will rise by the Consumer Price Index + 2% year on year.

You can pay off the equity loan in full anytime before then or make partial payment however the first payment needs to be at least 10% of the value of your home at the time.

You must repay the equity loan when you pay off your mortgage, sell your home or reach the end of the equity loan scheme which is normally set out 25 years (whichever is sooner).

Remember the government have a share in your property so should the value of the property increase so does the value of their share.

Equity loan & Help to buy table comparison

HELP TO BUY

East Midlands

HELP TO BUY

London

Type of property

New builds only

Maximum home purchase

£261,900

£600,000

Minimum deposit

Maximum home purchase

n/a

Equity loan from Government

up to 20% of property value

£1 a month in the first 5 years 1.75%

up to 40% of property value

£1 a month in the first 5 years 1.75%

Scheme fees

of loan value in sixth year
Then RPI + 2% per annum

Mortgage required

up to 75% of property value

up to 55% of property value

For first time buyers?

Yes

For existing homeowners?

For investment properties?

For buy-to-let homes?

For interest-only mortgages?

For repayment mortgages?

Yes

Available to

31st March 2023

Application deadline

31st October 2022

Help to buy East Midlands example

If the home in the table was sold for £300,000 20% will be paid back to the equity loan scheme being £60,000 the remaining funds will be used towards repaying your existing mortgage and your cash deposit

For a property worth £250,000

Amount

Percentage

Cash deposit

Equity loan

Your mortgage

£12,500

£50,000

£187,500

20%

75%

Help to buy London example

If the home in the table was sold for £550,000 40% will be paid back to the equity loan scheme being £220,000 the remaining funds will be used towards repaying your existing mortgage and your cash deposit

For a property worth £250,000

Amount

Percentage

Cash deposit

Equity loan

Your mortgage

£12,500

£200,000

£275,000

40%

55%

Further details of the scheme can be found at https://www.helptobuy.gov.uk/

View the government’s homebuyers’ guide for more information about the scheme and how to repay your Help to Buy: Equity Loan.

Whilst Robin Hood Mortgages Ltd take all reasonable steps to ensure the accuracy and timeliness of the information contained on this website. We cannot guarantee this and accept no liability for any errors or omissions. Any information provided on this website is for information purposes only. Full advice and recommendation can only be obtained by a suitably qualified adviser. Under no circumstances should any of the information contained within this website be construed as advice. You should seek professional advice in respect of your own circumstances. The information contained in this website is subject to UK regulatory regime and is therefore intended for consumers based in the UK.

think carefully before securing other debts against your home.
your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.

Robin Hood Mortgages Ltd is Authorised and regulated by the Financial Conduct Authority under reference 987739. You can check this on the FCA’s website www.fca.org.uk or by contacting the FCA at 0800 111 6768. The firm is registered in England & Wales at P.O. Box 11018, Nottingham, NG5 0NE. Telephone: 01156 712351 under reference 11416342.

If you wish to register a complaint please write to the address above or email us on info@robinhoodmortgages.co.uk

A summary of our internal procedures for the reasonable and prompt handling of complaints is available on request and if you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service at www.financial-ombudsman.org.uk or by contacting them on 0800 0234 567.

Although Robin Hood Mortgages are regulated by the Financial Conduct Authority, Business Finance, Loans and most buy-to-let and offshore mortgages are not regulated by the Financial Conduct Authority.

A Protection plan will have no cash-in value at any time and will cease at the end of the term. If premiums are not maintained, then cover will lapse and you may not be covered if a claim is made.

We do not charge a fee for residential mortgage advice. We charge an administrative fee for processing each of your mortgage contracts; our fees only apply when you decide to go ahead with an application.

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