Are there early repayment charges on a Help to Buy loan?
You can repay your Help to Buy equity loan partially by staircasing or by paying it off in full at any time, and you will not incur an Early Repayment Charge (ERC) as you do with a mortgage, or a penalty fee from Homes England for doing so.
In fact, it is highly advisable to repay your Help to Buy loan early. Once you have had your loan for five years, the interest-free period ends, and you become liable to pay monthly interest fees on the outstanding equity balance from year six onwards.
If you are planning on paying your Help to Buy loan off early, use our free online calculator to see how much you need to pay: Help to Buy Calculator.
Does Homes England charge a penalty for early repayment?
No. Homes England does not charge an Early Repayment Charge (ERC) or any financial penalty for paying off your Help to Buy equity loan early.
Whether you choose to pay off a percentage of the loan (known as partial staircasing) or clear the debt entirely, you will simply pay back the current market value of the percentage you borrowed. You are actively encouraged to pay the loan off as early as possible to avoid the interest fees that begin in year six.
What are the actual costs of repaying your loan early?
While there are no penalty fees, the process of repaying the loan does involve three mandatory administrative and legal costs:
- The RICS Valuation: You must instruct a Homes England-compliant RICS surveyor to value your property. This dictates how much you owe.
- Homes England Administration Fee: You must pay a £200 administrative fee directly to Homes England to process your repayment application.
- Conveyancing Fees: You must instruct a solicitor, experienced in Help to Buy transactions, to handle the legal work, transfer the funds, and officially remove the Homes England legal charge from your property title deeds.
We provide the complete Help to Buy redemption service from local RICS surveyors, to specialist Help to Buy Solicitors.
- Partial or full repayment.
- Repaying using a sale, remortgage, or from your own savings/gift.
- Fixed-fee, no-obligation quotes.
- On 99% of mortgage lender panels.
Will your main mortgage lender charge an early repayment fee?
This is where many homeowners get caught out. While Homes England will not penalise you, your primary mortgage lender might.
If you are using savings to pay off the equity loan, your mortgage lender is entirely unaffected. However, if you are remortgaging to pay off the Help to Buy loan, you are essentially replacing your current mortgage. If you do this while you are still tied into a fixed-rate period with your current lender, they will likely charge you a significant Early Repayment Charge.
Always check your current mortgage terms before making any enquiries about remortgaging to clear your equity loan.
How to start your Help to Buy repayment
If you are ready to proceed with paying off your loan, your very first step is to establish the current market value of your home. Homes England will not accept an estate agent's valuation; it must be a formal RICS report.
We provide nationwide, fixed-fee RICS valuations that are 100% compliant with Homes England's strict guidelines. We can also handle the specialist conveyancing required to remove the charge from your deeds.
Frequently Asked Questions
Andrew Boast FMAAT is a qualified accountant, conveyancing specialist and author with over 25 years of experience in the UK property sector. Since beginning his career in 2000 within established SRA and CLC-regulated conveyancing solicitor firms, Andrew has overseen the legal journeys of more than 75,000 clients.
He is the self-published author of the first-time buyer guide: How to Buy a House Without Killing Anyone, and a frequent contributor to mainstream UK media on legislative updates, property law, first-time buyer guides, conveyancing best practices, and stamp duty changes. Andrew specialises in resolving complex title issues, property conflict disputes, and property tax options, streamlining the enquiry process to reduce transaction times and maintaining a client-friendly focus.
Amanda Ambler is a highly accomplished conveyancing specialist with over 15 years of dedicated experience across residential property law, legal compliance, and practice management. Having held senior roles, including Head of Legal Practice and Head of Conveyancing at established UK law firms, Amanda possesses a profound, hands-on understanding of the technical intricacies of the property market.
As the designated Legal Content Reviewer for SAM Conveyancing, Amanda ensures that every guide, legal update, and resource published meets the absolute highest standards of accuracy, regulatory compliance, and factual integrity. Her rigorous review process guarantees that complex property legislation and industry processes are communicated clearly, transparently, and safely for home buyers and sellers alike.
