The Help to Buy equity loan in England

The Help to Buy equity loan was a government scheme that lent buyers in England up to 20% of the cost of a new build home, or up to 40% in London, alongside a 5% deposit and a repayment mortgage¹. It closed to new applicants on 31 October 2022², so nobody can apply for one today. But the scheme ran for nearly a decade, and the loans it made are still live: if you hold one, the government still owns a share of your home, you still owe a repayment that moves with your property's value, and from year 6 you are charged interest that rises every year¹.

This page explains what the equity loan is and how it works for the people who still have one: how the interest fee is calculated and when it starts, how repayments are worked out, how to get the valuation you need before repaying, what happens when you remortgage or sell, and what to do if you fall behind. It covers England only, because the Help to Buy equity loan was an English scheme¹. Wales ran its own version, Help to Buy Wales, and Scotland supports buyers through different shared equity schemes; both are covered in the final section.

The scheme is closed to new buyers, but existing loans still run

The Help to Buy equity loan began in April 2013⁵ and ran in two main phases: the original scheme, and a later version restricted to first-time buyers, known as Help to Buy: Equity Loan (2021 to 2023), which was the only variant still running between 1 April and 31 May 2023⁶. The scheme closed to new applicants in England on 31 October 2022². The related Help to Build equity loan, which applied the same idea to self build homes, has also closed: you can no longer apply for a Help to Build equity loan for properties in England⁷.

Closure does not affect existing borrowers. If you already hold an equity loan, it continues on the terms you signed, normally for a term of 25 years unless extended¹. The government's interest share still rises and falls with your home's value, the interest fee still starts in year 6, and the loan still has to be repaid when you sell, pay off your mortgage, or reach the end of the term. The customer service arrangements for managing the loan, making payments and asking questions also continue⁸.

For anyone buying now, the equity loan is not an option. The government has since announced a new scheme, Your First Home, offering 20% government-backed equity loans to prospective first-time buyers purchasing a new build property from a developer signed up to the scheme, due to be confirmed at a Budget⁹. Other routes into home ownership remain open, including shared ownership, the First Homes scheme and the schemes covered in our guide to first-time buyer schemes.

How the Help to Buy equity loan worked: up to 20%, or 40% in London

The equity loan sat between the buyer's deposit and their mortgage. Help to Buy: Equity Loan helped people onto the housing ladder by lending up to 20% of the home's purchase price, or 40% in London¹. The 20% loan allowed the buyer's deposit to be reduced to 5%, with the buyer only needing to initially take out and service a 75% loan-to-value mortgage, or less in London³. The London maximum was increased to 40% from February 2016³.

Because the loan was a share of the purchase price rather than a fixed debt, it behaved like an investment by the government in your property. The official examples show the shape of a purchase: outside London, a home bought with a £40,000 equity loan representing 20% of the purchase price; in London, a £160,000 equity loan representing 40%¹. If the home's value rose, the government's share rose with it; if the value fell, the share fell.

That link to property prices worked in both directions, and it is the single most important thing to understand about the loan. An independent evaluation of the scheme, commissioned by the Ministry of Housing, Communities and Local Government, examined the scheme in England from 2013 to 2023¹⁰. Its findings included research estimating that the increase in the maximum loan value in London led to an 8% increase in new build prices in London³, a reminder that the scheme's effects on the market were themselves debated.

Who could use it: new-build homes, first-time buyers and movers

The equity loan applied to England only¹. In its final phase, from 2021 to 2023, it was restricted to first-time buyers buying new build homes⁶. Earlier phases were open more widely, and the scheme's design always centred on newly built properties from registered developers.

Several conditions came with the loan, and they still bind existing holders:

• The home purchased had to be your only home, and the homeowners named on the equity loan had to be the same as those on the repayment mortgage¹¹.
• You could not buy a second property while you had a Help to Buy: Equity Loan, as this is a breach of the terms, and you would be legally required to repay the equity loan in full¹.
• You could not make regular monthly payments towards repaying the equity loan¹; repayment happens in lump sums, in part or in full, as explained below.
• Structural alterations to the home generally required permission, and permission is refused if the alteration is not made for a medical reason¹².

The restriction to new builds is why the scheme is covered in our guides to buying a new build home and new home warranties. Buyers who used the scheme faced the same considerations as any new build purchaser, including snagging and the complaints process for new build homes.

Interest-free for five years, then a 1.75% fee that rises with inflation

The equity loan was interest free for the first 5 years³. From year 6, interest starts at 1.75% of the original loan amount and rises annually with a link to inflation³. The fee is charged monthly: in year 6, the interest rate is 1.75%¹³, and the official example shows the arithmetic on a £10,000 remaining loan, £10,000 x 1.75% = £175 per annum, divided by 12, which is £14.58 per month¹.

From year 7 onwards the rate rises each year in line with the Retail Prices Index (RPI) plus 2%¹³. The official worked example, with RPI set at 5%, shows the year 7 rate at 1.8550% and the year 8 rate at 1.9663%¹³. In that example, on an equity loan value of £62,000, the annual interest after a 6% increase is £1,150.10, or £95.84 a month¹³. The same guidance also shows slightly different figures in places, £100.36 a month and £1,204.35 a year, so the documents are not fully consistent on the example payments¹³.

Two features of the fee catch borrowers out. First, the rate increases each year from year 6 even when inflation is 0% or less¹³, so the fee never stands still. Second, the fee is charged on the equity loan amount you borrowed, not on your home's value, so it does not grow just because your property has, though it does shrink if you make a part repayment: after a part repayment, monthly interest is worked out based on the percentage you have left to repay and the original purchase price¹. Interest payments start after the first five years, on the fifth anniversary of the equity loan¹³. Our narrow guide to when interest starts on a Help to Buy equity loan covers the timing in more detail.

Paying off the loan: all at once or in stages

You can repay your equity loan in part or in full at any time, for example when you sell your home or remortgage¹³. Part payments start from 10% of the current market value of your home¹. The amount you repay is based on the current market value of the home at the time you choose to repay, and the percentage you want to repay¹. So a borrower who took a 20% loan and repays 10% of the home's value halves the government's share; the remaining 10% continues, with interest recalculated on what is left¹.

If you sell the home, the repayment is worked out on the market value as set out in a compliant RICS valuation report, or the price you sell the home for, whichever is higher¹. This prevents a sale at an undervalue from reducing the government's share. The loan must also be repaid when you pay off your repayment mortgage or reach the end of the loan term, normally 25 years unless extended¹.

The repayment process has a defined order. Before you can repay, you must settle any outstanding payments in full or set up a payment plan with the customer service team¹⁴. When you apply to repay in part or full, you need a conveyancer to help with the legal undertaking¹⁵. The application form covers the conveyancer's details, the percentage you will repay and how you will fund it¹⁵. If you are repaying with your own money, such as an inheritance or savings, you must confirm where the money has come from, for example with a copy of a bank statement showing the money¹⁴. The official repayment guide and checklist walk through the whole process¹⁶.

Getting a RICS valuation before you repay

Because the repayment is a percentage of your home's current value, a professional valuation sits at the heart of every repayment. The market value is worked out by a Royal Institution of Chartered Surveyors (RICS) valuation⁴. The surveyor must be both RICS qualified and registered⁴, and for the 2021 to 2023 scheme variant, a RICS member or fellow (MRICS or FRICS)⁴. You choose the surveyor, and arrange and pay for the report yourself⁴.

The report must meet specific requirements:

• The surveyor must inspect the inside of the property⁴.
• It must provide at least 3 comparable properties and sale prices within the last 12 months, like-for-like homes in type, size and age, within 2 miles of the property⁴.
• The survey must be created, signed and dated on company headed paper, addressed to Homes England⁴.
• It must be supplied as a PDF or a digital document that cannot be edited⁴.
• You must send it to the Help to Buy agent within 5 days⁴.

The valuation report is valid for 3 months from the date it was produced⁴. If it expires, you may be able to extend it, but only within 2 weeks of it expiring⁴. The extension must come from the same RICS surveyor who made the valuation, on the company's headed paper addressed to Homes England, supplied as a PDF or an uneditable digital document, and sent within 5 days of issue; it extends the original report for 1 month from the date it expired⁴. The guidance also refers to a 3-month extension in some versions, so the documents are not consistent on the extension length⁴.

The agent may reject the valuation report if it does not follow the criteria, or if it is too high or low compared to similar properties⁴. Valuations carried out for bank or mortgage purposes are not acceptable for the equity loan¹⁸. Before you apply to repay, you must tell the agent about anything that might affect the value of your home, such as external cladding, as you may need a specialist valuation of your property¹⁷. A breach of planning permission triggers the same requirement⁴. If your building has cladding, our page on EWS1 forms and cladding costs explains the wider context.

Remortgaging or borrowing more with an equity loan in place

The equity loan does not stop you remortgaging, but it constrains what you can do. The agent will only allow you to remortgage and borrow more money for specific purposes: to pay back part or all of your equity loan, to make structural alterations when you have permission, or to fund a transfer of equity¹⁹. Borrowing more to pay off leasehold arrears or mortgage arrears may be allowed, with each case considered individually¹⁹.

The permission rules differ between full and part repayment. If you are repaying your equity loan in full when you remortgage, you do not need the agent's permission²⁰. If you want to repay part of your equity loan when you remortgage, you first need permission to change your mortgage provider or to increase the amount you are borrowing on your existing mortgage²⁰. Switching lenders for a better deal, without borrowing more, is a change the agent must also know about, and the rules on changing ownership apply: if you are behind with your equity loan payments, you will not be allowed to change the ownership¹¹.

A transfer of equity, changing who owns the home, has its own conditions. The homeowners named on the equity loan must be the same as those on the repayment mortgage¹¹. If you intend to borrow more on your repayment mortgage when you change the homeowners, you must have a mortgage offer or funds in place before you apply¹¹. If you are increasing the length of your repayment mortgage at the same time as changing names, the equity loan term may be changed to match the term of the repayment mortgage¹¹. Structural alterations need permission in advance, with a £50 admin fee for the application²¹, and if a retrospective application is declined you must either return your home to its original condition at your own cost, or repay the loan¹².

Ways to pay Help to Buy

Repayment money reaches the scheme through defined routes. When you repay with your own money, such as savings or an inheritance, you supply evidence of where the money came from, and the application sets out how you will fund the repayment¹⁴. When you repay by remortgaging, the process runs through the permission steps above²⁰. When you sell, the repayment is settled from the sale proceeds through your conveyancer¹.

The practical points of contact are straightforward. The repayment application form is downloaded from www.gov.uk/manage-equity-loan¹⁵. The repayment guide is available from the government's publications pages, and an accessible version can be requested by emailing enquiries@homesengland.gov.uk¹⁶. The government also publishes a glossary of the words and phrases you may come across when managing your equity loan or repaying it²², which is useful when a letter from the agent uses terms such as "staircasing" or "redemption".

Administration fees apply to certain changes. Making structural alterations to your Help to Buy home carries a £50 admin fee²¹. Where an admin fee is paid online by SMS payment link, the link works for 4 days from when it is sent²¹. The customer service team handles payments, changes to the agreement and questions about the scheme⁸.

Falling behind on payments and making a complaint

Arrears can build up when one or more of your monthly interest payments or management fees have not been paid²³. Falling behind has consequences beyond the debt itself: you cannot change the ownership of your home while in arrears¹¹, and you must settle any outstanding payments in full or agree a payment plan before you can repay the equity loan¹⁴. If you are struggling, contact the Help to Buy customer service team early; a payment plan is the documented route to getting back on track¹⁴. Free, impartial money guidance is available from MoneyHelper and the debt charities listed in our debt guide.

If you need to complain, you can do so via email, telephone or in writing²⁴. To investigate your complaint, the team needs your name and date of birth, plus two of the following: your customer reference number, the first line of your address and postcode, the name and date of birth of anyone else on the equity loan, your phone number, your monthly interest payment amount and date, or a password if one has been arranged²⁴.

Complaints about Help to Buy and shared equity loans reach the Financial Ombudsman Service in small numbers. In Q1 2026/27, 27 complaints about Help to Buy and shared equity loans were opened²⁵. In Q1 2025/26 there were 38 complaints with a 62% uphold rate²⁶, and across 2025/26 as a whole there were 110 complaints with a 64% uphold rate²⁷. An uphold rate above half means the majority of complainants who escalate to the ombudsman had their complaint resolved in their favour, which suggests it is worth pursuing a genuine grievance through the full process. Our guide to complaining when buying a home goes wrong covers the wider route.

Help to Buy in Scotland and Wales works differently

The Help to Buy equity loan applied to England only¹. The devolved governments ran their own schemes, and their rules differ in ways that matter to borrowers who hold them.

Wales. Help to Buy Wales was a Welsh Government scheme providing a shared equity loan to buyers of new build homes²⁸, an equity mortgage of up to 20% of the market value of a new home²⁹. It was open to all home buyers, not just first-time buyers, who wished to purchase a new home but might be constrained in doing so², and closed to new applicants in England's scheme on the same date, 31 October 2022². Existing Welsh loans still run on similar principles: no interest for the first 5 years, with interest from year 6²⁹, and repayment calculated as a proportion of either the current market value established via an independent RICS valuation or the sale price, whichever is higher²⁹. Welsh valuations are valid for 3 months from the date of inspection³⁰, and a desktop valuation report can extend the original report for a further 3 months³⁰; if the desktop valuation expires and six months in total is reached without completing, a new RICS valuation with reinspection is required³⁰. Welsh valuation rules differ in detail from England's: comparables must be within the last 6 months and within 5 miles, rather than 12 months and 2 miles¹⁸. Further borrowing in Wales is only considered for making a partial payment of the equity mortgage, or to fund alterations in exceptional hardship circumstances³⁰. Our page on Help to Buy Wales covers the scheme in full, alongside shared ownership and Homebuy in Wales and how to repay a Help to Buy Wales loan early.

Scotland. Scotland did not run the same equity loan. Its main support now is the Open Market Shared Equity (OMSE) scheme, which helps first-time buyers on low to moderate incomes to buy a home on the open market³¹, including priority access groups who cannot afford the full price of a home, such as social renters, disabled people, people aged 60 and over, and members of the armed forces and veterans³². The scheme opened for applications in August 2026³². Buyers obtain a valuation from an independent professionally qualified valuer registered with RICS, which forms part of the Home Report unless the property is a new build, in which case a valuation is obtained at the buyer's expense³³. See our guides to shared equity schemes in Scotland, Help to Buy Scotland and increasing your share in an OMSE home.

England's next scheme. The government has announced Your First Home, offering 20% government-backed equity loans to first-time buyers purchasing a new build property from a developer signed up to the scheme, due to be confirmed at a Budget⁹. Until details are confirmed, the closed equity loan, shared ownership and First Homes remain the reference points for English buyers.