Repaying or staircasing your Help to Buy equity loan? You repay the same percentage of your home's current value as you originally borrowed — so if it's gone up, you owe more. Enter your figures to see the repayment and the interest fee.
Equity loan redemption
Under the government's Help to Buy: Equity Loan scheme (now closed to new buyers), you borrowed a percentage of your new-build home's price — usually 20%, or up to 40% in London — interest-free for the first five years. The crucial rule is that you repay the same percentage of the home's value at the time you repay, not the pounds you borrowed. So if your home has risen in value, the amount you owe rises too.
The loan is interest-free for the first five years. From year 6 you pay a monthly interest fee, starting at 1.75% of the original loan amount each year and rising annually (historically by RPI/CPI plus a margin). This fee doesn't reduce what you owe — it's a charge for keeping the loan. You can repay in part (staircasing, usually in 10% chunks) or in full at any time, and full repayment is required when you sell or at the end of your mortgage term. Plan the wider picture with the mortgage calculator and affordability calculator.
You repay the same percentage of your home's current market value as you borrowed. A 20% loan on a home now worth £300,000 means repaying £60,000 — whatever you first borrowed. A RICS valuation sets the figure.
It's interest-free for the first five years. From year 6 a monthly interest fee starts at 1.75% of the original loan each year and rises annually — a charge for keeping the loan that doesn't reduce what you owe.
Yes — you can part-repay (staircase) in 10% portions, or repay in full any time, each based on a fresh valuation. Full repayment is due when you sell or at the end of your mortgage term.
Yes — because you repay a percentage of today's value, a rise increases the cash owed (though you also gain on the share you own). If values fell, you'd repay less than you borrowed.
