Remortgaging to pay off Help To Buy? Try Tembo

After the first 5 years in a Help to Buy property, you will begin to pay interest on your equity loan. This is the loan the government lent to you to help you buy your home. It was interest-free for the first 5 years, but after 5 years you'll pay an annual fee of 1.75% on the outstanding loan, which will increase each year with inflation.

As a general rule, you can start the process of remortgaging up to 6 months before your existing mortgage deal comes to an end. If you don't find a better deal by the end of your current product term, you may be put onto your lender's standard variable rate (SVR), which can make your monthly repayments considerably higher.

How long it takes to remortgage depends how quickly you can receive a new mortgage offer from a lender and if there are any delays in the process. Working with a mortgage broker like Tembo can help speed things along, as your dedicated advisor will do a lot of the admin work for you. On average, it takes our remortgage customers 12 days to receive a new mortgage offer and 29 days for their new mortgage deal to be submitted.

Yes, you can remortgage early and leave your fixed rate mortgage before it's ended to change to a different mortgage provider. However, you may be charged an Early Repayment Charge (ERC) as well as other exit fees which may outweigh the benefits of switching early. If you aren't tied into a fixed rate mortgage, switching mortgage providers is even easier as you don't need to pay an ERC to leave.

There is a smaller number of lenders who offer remortgages for Help to Buy properties, especially if you still need to pay off your equity loan. Because you have two loans on the property - your mortgage and the equity loan - this makes you a riskier borrower in the eyes of lenders. However, this doesn't mean you can't remortgage with a Help to Buy property. There are also ways you can remortgage to pay off your Help to Buy loan, so you'll be left with just a mortgage to pay.