How to use the Help to Buy equity loan calculator
- 1 Enter the price you paid and your equity loan share (usually 20%, or up to 40% in London).
- 2 Enter what the home is worth now.
- 3 Choose the year you bought.
- 4 Enter an inflation rate for future rises, then read the repayment and interest.
Worked example
A £250,000 home bought in 2020 with a 20% equity loan (£50,000), now worth £290,000. Repaying today costs £58,000. The loan is in about year 7, so after a 4.5% rise (RPI 3.5% + 1%) the rate is 1.83% of £50,000: about £914 a year, £76 a month, plus the £1 fee. Keeping the loan another five years at the same inflation would cost about £5,000 in interest.
Repaying Help to Buy
- Get a RICS valuation: it is valid for three months.
- Compare remortgage deals before year 6 starts.
- Repay at least 10% to cut interest if you cannot clear it.
- Remember the fee: £1 a month until the loan is repaid.
Price a bigger mortgage with the Remortgage Calculator and the Mortgage Affordability Calculator, or compare with the Shared Ownership Calculator.
Features
Repayment today
Your share of the current value, as Homes England would use.
Interest schedule
1.75% in year 6, then rising each April by CPI + 2% or RPI + 1%.
Cost of waiting
Interest over the next five years if you do not repay.
When to use it
Remortgaging to repay
Compare the repayment with a bigger mortgage. See monthly payments with the Remortgage Calculator.
Interest-free period ending
See what year 6 will cost before it starts.
Selling your home
See how much of the sale price goes to repay the loan. Plan your next purchase with the Stamp Duty Calculator.
Partial repayment
Repaying at least 10% reduces the interest. Check affordability with the Mortgage Affordability Calculator.
Related Home and Auto tasks
Frequently asked questions
How do I work out my Help to Buy repayment?
Multiply your home's current market value by your equity loan percentage. A 20% loan on a home now worth £290,000 means repaying £58,000, even if you borrowed £50,000. A RICS valuation is needed to repay.
When does Help to Buy interest start?
In the sixth year of ownership. You pay 1.75% of the original loan amount in year 6, plus a £1 monthly management fee from the start.
How much does the interest rise each year?
Every April from year 7. For homes bought under the 2021 to 2023 scheme, the rate rises by CPI plus 2%. For the 2013 to 2021 scheme it rises by RPI plus 1%. The rise is applied to the rate, so 1.75% becomes about 1.83% after a 4.5% rise.
Does paying interest reduce the loan?
No. Interest payments do not reduce the amount you owe; only repayments of the loan itself do.
Can I repay part of my Help to Buy loan?
Yes. You can repay a minimum of 10% of the home's market value at a time. That reduces the interest, because interest is charged on the part of the original loan still outstanding.
Is it better to repay before year 6?
Often, if you can remortgage at a sensible rate, because you avoid the rising interest. But if your home's value rises, so does the repayment, so compare carefully.
What if my home has fallen in value?
You repay your percentage of the lower value, so you repay less than you borrowed. Homes England shares any loss as well as any gain.
Can I still apply for Help to Buy?
No, not in England: the scheme closed to new applications in 2023. Help to Buy Wales remains open to applications until 31 March 2027.
Who manages Help to Buy loans?
Target HCA manages the loans for Homes England. They send yearly statements and handle repayments.
Results are estimates based on the official rates linked above. Confirm important figures with the issuing authority or a qualified adviser before you act on them.
Built and reviewed by Hamza Farooq, founder and lead developer
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