Information for Help to Buy: Equity Loan customers during Coronavirus (COVID-19)

Thursday May 21st, 2020

We understand that coronavirus (COVID-19) is worrying and that things still feel very uncertain as the lockdown period enters its second phase (May 2020). There are many questions about what coronavirus means for Help to Buy: Equity Loan customers and we aim to answer some of these below. This page has been updated for May 2020.Coronavirus

If you have a question that your house builder, solicitor or moving company can’t answer, please get in touch with your Help to Buy agent. Calls and emails may take longer to respond to in the current circumstances.

Frequently asked questions

Section 1 – Moving home now
I’m using a Help to Buy: Equity Loan to buy a home, can I still go ahead during this stage of the coronavirus lockdown?

Yes. Help to Buy homes are newly built and unoccupied, so it’s possible to continue buying a home. You and your solicitor, mortgage advisor, house builder and anyone else involved in the buying process must check the latest government advice on home moving issued on 13 May 2020.

Section 2 – Authority to Proceed
Will my Help to Buy: Equity Loan Authority to Proceed still be valid?

Some mortgage lenders have committed to keeping existing mortgage offers open for three months. If your main mortgage lender has agreed to this, your Authority to Proceed will be extended up to the expiry date of your existing mortgage offer in line with current guidelines.

My Authority to Proceed is based on a valuation carried out before the lockdown started. What happens if the value of the house I’m buying has fallen?
The Government will continue to honour Help to Buy: Equity Loans agreed with home buyers before the lockdown. We won’t need a revaluation if your main mortgage lender is happy to proceed.

Section 3 – Valuations

Will you accept desktop valuations instead of onsite valuations during the current phase of the lockdown?

Yes. If your main mortgage lender is using a desktop valuation to support its mortgage offer, that is acceptable for Help to Buy.

I want to repay my Help to Buy: Equity loan, can a surveyor come to my home to do a valuation report?

Surveyors are free to visit properties to carry out surveys. Surveyors should follow the latest government guidance and all public health guidance on social distancing.

I need a survey urgently for my remortgage and there is a long wait for a surveyor visit, what can I do?

During the current phase of lockdown we may be prepared to accept a desktop valuation, if you are able to demonstrate exceptional circumstances.

Each application for a desktop valuation will be considered at our discretion on a case by case basis.
This means you can get a Royal Institution of Chartered Surveyors (RICS) surveyor to provide a desktop valuation. You’ll need to meet certain requirements for the desktop valuation.
What are the requirements for a desktop valuation?
A desktop valuation can be carried out without a surveyor visiting your home if it meets these requirements:

The surveyor must be approved by the Royal Institution of Chartered Surveyors (RICS). You can find an approved surveyor on the RICS database
The surveyor must be independent of the estate agent looking after the sale of the property (if applicable).

The surveyor must not be related or known to you, to avoid any conflict of interest.

The survey must be provided on headed paper of the surveying company or approved surveyor (if they’re a sole trader), signed by the RICS surveyor, and addressed to Homes England. It needs to be in PDF or another non-editable document format.
The surveyor must list at least six comparable properties and sale prices. These properties must be like-for-like in terms of type, size, age and within a two-mile radius of the property being valued, as per RICS guidance. If six properties aren’t available, the surveyor must explain the reasons why they aren’t comparable.

How long will the desktop valuation be valid for?

Desktop valuation reports are valid for three months from the date of the report.

Section 4 – Reservations
I’ve reserved a new home off-plan on a development site, will it be ready on time?
House builders are returning to work on sites, but they are not all taking the same approach. Contact your house builder to find out about their situation.

I’ve reserved a home and have the go-ahead for a Help to Buy: Equity Loan, but I’ve lost my job due to the outbreak. Can I pull out of the deal?
Depending on your circumstances, house builders have the option to partly refund the reservation fee of up to £500 if you need to cancel. They’ll follow the reservation terms and conditions and can charge for any reasonable costs they may have incurred.

Contact your house builder to understand your options. If you’ve already agreed a mortgage with a lender, you need to contact them to explain your change in circumstances and to discuss next steps.
Section 5 – Completions
My Authority to Proceed with a Help to Buy: Equity Loan has expired, and I’m worried I’m going to lose my home. What can I do?

Get in touch with your Help to Buy agent urgently and ask for an extension on your Authority to Proceed. This will allow your home purchase to continue. You should check that your mortgage offer will remain valid if a new completion date is agreed. All mortgage lenders are working to find ways to extend their mortgage offer by up to three months to help customers who’ve exchanged contracts to move later if necessary.

I’ve exchanged contracts on a new home and have a Help to Buy: Equity Loan agreed, will I be able to complete my purchase?
Yes. As long as you have a valid mortgage offer on the date of completion and are able to complete prior to 31st March 2021.

If you’ve exchanged contracts and are concerned about your completion date and the need to extend your mortgage offer, please contact your lender.
I am in my home, but I have a snagging issue that I want the housebuilder to fix. Are they able to come to my home?

The first thing to do is speak to the housebuilder. Where possible the housebuilder should investigate remotely using video or photo evidence. If this is not possible, when the inspector visits your home put measures in place to minimise physical contact, for example, you and your family should stay in another room during the visit
Section 6 – Payment holidays

I’m struggling to pay my mortgage and equity loan interest as I’m still not working due to coronavirus, am I eligible for a payment holiday?
On 17 March 2020, the Government announced mortgage lenders had agreed to support customers experiencing personal financial difficulties due to coronavirus with three-month payment holidays, and other options. These remain in place. They mean you won’t have to make any monthly mortgage payments for a set amount of time. But before cancelling any direct debits, please contact your lender to ask for a payment holiday on your monthly mortgage payments.

If you’re struggling to pay the interest fees on your Help to Buy: Equity Loan, you can also apply to put these payments on hold for up to three months if you:
have contracted coronavirus;

need to care for a family member who has coronavirus;
are a permanent, temporary, full-time employee or contractor and had your working hours reduced either temporarily or permanently;

are a business owner or self-employed and your business has been affected.

If you took out your equity loan in May 2015, you’ll start to pay interest fees from May 2020.

I’m due to make my first interest payment this month. Due to the current circumstances, can I take the payment holiday?
Yes. If you’re due to make your first interest payment, you’re entitled to request a three-month payment holiday/delay.

What happens at the end of my payment holiday?

When the payment holiday ends, your equity loan payments will return to the normal monthly amount. The important thing to remember is that the amount you owe will increase by the interest amount that has not been paid during your payment holiday. Also, during your payment holiday, interest will continue to be added to your account at the same rate that is in your loan agreement.
Section 7 – Remortgaging

I am in the middle of remortgaging and this involves a legal Deed of Postponement, will you accept an electronic signature on this phase of lockdown?

Currently the Land Registry continues to require a ’wet signature’ on deeds, so we’ve put in place a manual process to do this. However, given the current situation it’s taking longer than usual, but rest assured that we’re still completing all legal requirements for deeds. If you’re concerned about whether your lender will need a wet signature for mortgage documentation you should contact them directly

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