Can I sell if I still have a Help to Buy equity loan?

Start from the reassuring part. Tens of thousands of Help to Buy homes are sold every year with the equity loan still outstanding, and the process is routine, defined and administered by people who do nothing else. It runs in parallel with your sale rather than blocking it.

How does a Help to Buy equity loan get repaid when I sell?

A Help to Buy equity loan is a government loan of a fixed percentage of your home's value, taken out when you bought a new build and repayable when you sell, remortgage or reach the end of the term. Because it is a share of value rather than a fixed sum, what you owe moves with your home's price.

That is the part that surprises sellers. If you borrowed 20% and your home has gone up, you repay 20% of the higher figure, and the difference stays with the loan rather than with you.

In that example the seller repays £10,000 more than they borrowed, and it comes out of the proceeds at completion rather than out of their pocket beforehand. If prices had fallen instead, the repayment would fall with them.

What do I actually have to do, and in what order?

1. 1. Tell the loan administrator you intend to sell

   Help to Buy equity loans are administered for Homes England by Lenvi Servicing. Contact them at the start rather than when you have an offer, because everything below runs on their timetable, not your buyer's.

2. 2. Book a RICS valuation

   The valuation must be carried out by a valuer registered with the Royal Institution of Chartered Surveyors and independent of your estate agent. Your agent's market appraisal cannot be used for this, however accurate it is.

3. 3. Submit the valuation report inside the deadline

   The report should be sent to the administrator within five working days of the inspection, and it stays valid for three months. Miss the window and you pay for a second valuation.

4. 4. Pay the administration fee and check the figure

   An administration fee of around £200 applies when the valuation and offer are submitted. Read the redemption figure carefully, because it is calculated on the higher of your valuation and your sale price.

5. 5. Get your conveyancer to give the legal undertaking

   Your solicitor gives the administrator a signed undertaking that the loan will be repaid from the sale proceeds. This is standard work for any conveyancer who has handled a Help to Buy sale, so ask that question when you instruct them.

6. 6. Wait for the authority to complete before fixing a date

   Completion cannot happen until the administrator issues the authority to complete to your solicitor. Agreeing a completion date before that document exists is how these sales end up rescheduled.

7. 7. Watch the three-month clock against your chain

   If your buyer's mortgage or a chain above you drifts past the valuation's expiry, you need a fresh valuation and a fresh figure. Diarise the expiry date the day the report lands.

How long does the Homes England side take?

The steps themselves are quick. The delays come from sequencing, because the valuation cannot be booked usefully too early and the authority to complete cannot be issued too late.

• Book the RICS valuation once you have an offer you believe in, not before you market and not after your buyer's survey.
• Give your conveyancer the loan reference on day one, so the undertaking is not the last thing anyone thinks of.
• Tell your buyer's side early that an authority to complete is required. A buyer who knows why a date is provisional is a patient buyer.
• If interest has started, remember the loan is interest-free for the first five years and then charged at 1.75% of the original loan in year six, rising each year afterwards.

How does this affect what I walk away with?

Work backwards from the sale price. The equity loan repayment, your outstanding mortgage, the agent's fee and your legal costs all come off before anything reaches you, and the equity loan is usually the largest of the four.

• The repayment percentage never changes, so the whole calculation turns on the value used.
• Where your RICS valuation comes in above your agreed sale price, the higher figure is used, and that gap comes out of your share.
• Getting the asking price right at launch matters more here than in an ordinary sale, because an underpriced quick sale does not reduce what you owe.
• Compare what several agents would market it at before you commit, so the number you sell at is the number the market supports.

The equity loan is settled out of the proceeds, not out of your savings. What it needs from you is sequence and a diary, not money upfront.

What else do Help to Buy sellers ask?

What is the one thing to get right?

The sale price, because the loan takes its share of value whatever you sell for. That makes it worth seeing what more than one local agent would put your home on the market at before you pick one.

ValuQ is a platform that gives UK homeowners free, side-by-side property valuations from competing local estate agents. Sellers stay anonymous until they choose to connect, so you can compare the numbers without your phone starting to ring.