Help to Buy Equity Loan Repayment UK 2026: How to Value and Repay

The Help to Buy Equity Loan scheme in England closed to new applicants in October 2022, but hundreds of thousands of homeowners still carry an outstanding equity loan on their property. If you are one of them, understanding how repayment works -- and when it makes financial sense to repay early -- could save you a substantial amount of money.

How the Equity Loan Works

Under the Help to Buy Equity Loan, the government lent buyers up to 20% of the purchase price of a new-build home (40% in London). The buyer contributed at least a 5% cash deposit and took out a standard repayment mortgage for the remainder. The equity loan itself was interest-free for the first five years; from year six, a fee of 1.75% of the outstanding loan value was charged, rising annually by the Consumer Prices Index (CPI) plus 2%.

Crucially, the loan is equity-based, not a fixed-sum loan. You do not owe a fixed cash amount -- you owe a percentage of the property's value at the time of repayment.

The Percentage, Not the Pounds

This is the single most important thing to understand about Help to Buy repayment. If the government lent you 20% of your purchase price, they hold a 20% equity stake. When you come to repay, you owe 20% of whatever your property is worth at that point -- not 20% of the original purchase price.

Example: You bought your home for GBP 250,000. The government lent you GBP 50,000 (20%). Your property is now worth GBP 300,000. You owe GBP 60,000 -- not GBP 50,000.

If your property has fallen in value to GBP 220,000, you owe GBP 44,000. This is why repaying during a market dip can be financially advantageous. You crystallise your liability at a lower value.

Step-by-Step: How to Repay

Step 1: Instruct a RICS-registered surveyor. You must use a RICS-qualified valuer approved by Homes England (the scheme administrator). You cannot use your own informal estimate or an online valuation tool. The surveyor provides a formal valuation valid for three months.

Step 2: Contact your Help to Buy agent. Homes England administers the scheme through regional agents. You submit the RICS valuation and request a repayment figure. The agent calculates the exact amount based on your equity percentage and the valuation.

Step 3: Secure the funds. You can repay using savings, a remortgage, or a further advance on your existing mortgage. Many borrowers remortgage to raise the funds, though this replaces a low-rate equity loan fee with a higher mortgage interest rate -- so the maths must stack up.

Step 4: Minimum repayment. You can repay the loan in full or in part, but partial repayments must be at least 10% of the current market value of the property (not 10% of the loan). There is no upper limit on partial repayments. Each partial repayment reduces the percentage the government holds.

Step 5: Legal completion. A solicitor handles the actual transfer of funds to Homes England and updates the land registry to remove or reduce the charge.

Fees and Charges

From year six, the annual management fee is 1.75% of the outstanding loan value, rising by CPI plus 2% each April. In a high-inflation environment this can escalate quickly. For a GBP 50,000 loan the year-six fee is GBP 875, rising each year. Over a decade, the cumulative fees become significant -- which is another reason many borrowers prioritise repayment.

There is also a GBP 200 administration fee payable to Homes England for each repayment transaction.

When Does Early Repayment Make Sense?

The decision hinges on two factors: the direction of property prices and the cost of borrowing.

If house prices in your area are falling or flat, repaying now locks in a lower liability. If prices are rising rapidly, waiting means your repayment amount grows -- though your property wealth also increases correspondingly.

Compare the annual management fee (and its projected increases) against the interest rate on any borrowing you would use to fund repayment. If you can remortgage or use savings at a lower effective cost than the rising management fee trajectory, repayment makes sense.

Selling the Property

If you sell before repaying the loan, Homes England receives their percentage of the sale proceeds automatically at completion. You cannot sell without repaying. If you sell at a loss, you still owe the percentage of the sale price -- Help to Buy does not absorb your losses.

SDLT Considerations

Repaying the Help to Buy loan does not itself trigger Stamp Duty Land Tax (SDLT). SDLT was charged on the original purchase. However, if you remortgage to fund repayment and take out a new mortgage product, standard mortgage application fees apply.

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Use the CalcHub Stamp Duty calculator to model the SDLT on any future property transaction once your Help to Buy loan is cleared.