Your Equity Loan Questions Answered
We understand the process of buying a house can be daunting, so through our website, social media and contacting the team in the office we are always looking for ways to help.
We recently posted on our Facebook, Twitter and Instagram asking for your Help to Buy Equity Loan Scheme questions. We had a great response and so sat down with the team to put your questions to them.
- What is your role in the Help to Buy Scheme?
Help to Buy North West is based in Liverpool and act as the agent for Homes England in the North West. We act as administrators for the scheme during the sales process, up until the sale is completed and the property is registered with the land registry. Following the Help to Buy sale, we pass your details to Homes England’s Mortgage Administrator and they will be able to help you with any questions or issues after completion.
- Is the Help to Buy process complicated?
No, from a buyer’s point of view it isn’t complicated at all, as your Solicitor and IFA (if you use one) will deal with the vast majority of the scheme for you. As with any house sale it is important to get good advice, but when going through the Help to Buy scheme their prior experience and knowledge will ensure there are no hold ups or delays. If you don’t know where to start, we have lists of experienced solicitors and IFAs on our website that may be able to help.
- Do you carry out a credit check?
Normally we don’t carry out any kind of credit check. We only ask for a copy of the mortgage offer from the lender to demonstrate that you have been able to secure the mortgage needed to buy your property.
- Will this add time on to my house sale?
Using Help to Buy shouldn’t add any additional time to your property sale. If you use solicitors who are aware of the extra forms required and when they are due the sale should be completed in a normal time scale.
- What do I do if I have issues or questions post completion?
Post completion your details will be passed to the Mortgage Administrator, Target. They have lots of information available on their website: www.myfirsthome.org.uk so that would be your first place to look. The website also contains their contact details should you have issues which can’t be resolved online.
- What do I do it completion is delayed?
We expect the whole process to take no longer than 9 months – with no more than 6 months between exchange and completion. If contracts have been exchanged and completion is delayed beyond the standard time scales then the developer will need to contact Homes England directly and resolve this issue by asking for an extension.
- Can I buy off plan?
Buying off plan is a valid option but you should make sure you’re aware of the timescales involved and how that will affect your application and mortgage offer.
- How do I pay off the Equity Loan?
The equity loan has a term of 25 years, but you have the option of paying it off at any time. Some people expect to re-pay the loan when they sell the property, but you do have other options. More information is available at helptobuynw.org.uk/help-to-buy/repaying-your-equity-loan or from www.myfirsthome.org.uk
- Why is Help to Buy allowed on leasehold houses?
In December 2017, Government published the response to its consultation: “Tackling unfair practices in the leasehold market”. The response can be found in full here: https://www.gov.uk/government/consultations/tackling-unfair-practices-in-the-leasehold-market
The majority of Help to Buy new build house sales are already freehold and Government intends that they should all be freehold in all but exceptional circumstances. Leasehold can make sense for buildings with shared spaces and infrastructure, such as blocks of flats. Almost all sales of Help to Buy flats will continue as leasehold sales unchanged as is the usual practice for this type of home.
If you intend to purchase a leasehold Help to Buy equity loan house you can still proceed but, as with the purchase of any property, you are strongly advised to take independent legal advice from your solicitor/conveyancer, and pay particular attention to the terms of the lease before you contractually commit to the purchase whether it is a house or flat/apartment. It is your responsibility to do this. You can refer your solicitor/conveyancer to the link to the Government’s response. You may also wish to get in touch with LEASE via their website at https://www.lease-advice.org/
We are always on hand to answer your questions if they weren’t covered here or in our FAQs section. You can contact us through the website, by emailing the office, getting in touch on social media or even meeting us face to face when we attend new development open days.