Help-to-Buy Remortgage > Rightmortgageadvice.co.uk

Quick Summary:

• If you bought with a Help-to-Buy equity loan, refinancing now may help reduce long-term costs.
• You can remortgage while keeping the equity loan, staircase (partially repay), or buy out full ownership.
• Buying out the HTB loan requires a RICS valuation, a £200 admin fee, and a conveyancer.
• Many lenders won’t remortgage where HTB remains outstanding, so advice is critical to find competitive options.
• If you own 100% after remortgaging, your options widen significantly—including borrowing more if needed.
• Those affected by the cladding crisis may benefit from buying out the equity share at a reduced value, though negative equity risk and lender policy need review.
• Fee-free advice is available to help find the best mortgage deal whether switching lender or staying put.

Our Help-to-Buy Remortgage Advice Service

Our typical service for remortgage advice is fee-free; we will receive a commission from the lender, and there is nothing to pay us for our advice.

We will compare options from the whole market (usually including your existing lender's product transfer deals) and those with other lenders, recommending the best cost route available; we then arrange that mortgage for you, taking the hassle out of making sure you are not paying too much.

Should I buy out or "staircase" my Help-to-Buy Loan with a remortgage?

As the initial interest rate charged on the Help-to-Buy Loan is only 1.75% in the sixth year, it can seem like leaving the loan in place as is would be cost-effective with typical mortgage deals over 4% at the time of writing (05/2025).

But this is far short of the big picture. Firstly, the rate will increase in line with the Consumer Price Index or CPI each year (currently 2.6%). So, within a single year, it is likely to approach the mortgage rate you might be paying.

Secondly, if house prices also increase, you will be hit by inflation twice. As the HTB loan is actually a percentage of the property value, any increase in house prices increases your debt too.

That does make the choice fairly tricky currently, with a recession a possibility. But, with the expectation of base rate reductions driving down mortgage rates, it seems likely that at least a little house price growth will occur in many areas. Inflation is ticking upwards again, but will possibly be allowed to climb somewhat to stave off the risk of recession.

So it may be a good time to refinance to repay this debt for many. This is potentially compounded for those on higher-rate taxes.

As the HTB loan is interest-only, any payments towards it are “dead money”. The debt won’t reduce unless house prices do (and will for many increase). So, you should consider making contributions towards the capital of the loan even if you leave it outstanding.

If you don’t include it in the mortgage, you should consider making savings or investment contributions to cover the long-term repayment. If you are a higher-rate taxpayer, any returns on those will not only be hit by inflation, but additional tax.

What is the process for buying out 100% ownership or staircasing?

The mortgage process is no different in this case than a standard remortgage, but you will need to engage with the Help-to-Buy loan provider and complete an application form (we can normally complete this with you, along with the mortgage application).

A fee of £200 administration costs is paid to the HTB loan provider, and you need to arrange a RICS (Royal Institute of Chartered Surveyors) market valuation of the property. The mortgage lenders valuation is not suitable for this purpose.

You will also need to appoint a conveyancer to arrange the legal work of the transaction. This can be a good reason to change your lender, as free legal work is often provided as part of a remortgage deal.

Although you would still need to pay a “disbursement” for the additional element of settling the HTB loan, this will likely be considerably cheaper than appointing a conveyancer entirely separately.

You also need to arrange finance simultaneously, which we can assist with, whether with your existing lender or a new one.

What are my options if my ownership will be less than 100%?

Many lenders do not offer remortgages where there is a Help-to-Buy loan outstanding. So, comparing your options and making sure you get the best deal is quite challenging for a consumer.

You can, in almost all cases, just take a new deal with your current lender, but this could be uncompetitive. We can normally advise you on both your existing lender's deals; those with others, and still offer a fee-free service.

What are my options if I buy out the whole of the ownership of the property?

What are my options if I buy out the whole of the ownership of the property?

When you buy out the whole of the ownership, the mortgage will become a standard remortgage, so your options will only be affected by other factors like your income, employment, credit history and the property type.

We can help you select the best options available, including the potential to borrow additional funds from your current lender. Although when borrowing more and repaying a Help-to-Buy loan, there is no administrative benefit to remaining with the same lender.

Whereas in a normal remortgage scenario, changing lender can be a lot more effort and so needs to offer a sufficient saving to be worthwhile, it's possible in this scenario that just gaining free legal work might be worth changing lender even if their deal was virtually identical in cost otherwise, to your existing lenders.

How does the cladding crisis affect buying out a Help-to-Buy loan?

Many of those on HTB mortgages will have been affected by the cladding crisis. If the value of your property has fallen significantly, whilst this might mean the value of the HTB loan could have reduced (so buying out the share before any remedial works are reflected by market value could be a good choice) but many will also find themselves in negative equity on the original equity share.

So, for each customer, arranging a new deal with your existing lender is almost always possible, even if you have entered into financial difficulty and arrears (although in this instance, you should approach them to arrange this if you have arrears).

For most customers, though, deciding whether to refinance to buy out the HTB portion will depend on whether the property's fire risk assessment is favourable, whether works are outstanding or completed, how they will be financed and the extent of any negative equity.

Contact us for an individual discussion on whether you can buy out the HTB loan if this applies to you.