Equity loans

We no longer offer equity loans – this is a guide for existing equity loan holders on how to repay their loan.

Repaying your equity loan

You can repay your loan at any time (repaying is sometimes also known as redeeming).

You can either do this by selling your property and settling the loan amount on completion, or by raising funds another way (such as remortgaging).

Most equity loans can only be repaid in full, but you can pay in instalments if your loan came via the MyChoiceHomeBuy scheme.

With this scheme you can repay your loan in multiple chunks, but there’s a minimum repayment amount of 10%. This sounds handy, but be aware that you’ll incur charges each time you make a repayment. There’s a valuation fee, solicitor’s costs and an admin fee of £175 to consider, so you may be better off making fewer, larger repayments.

Other rules to know

There are a couple of important things to know.

Firstly, you can’t make a repayment if it would leave less than 10% of the loan remaining.

Secondly, the amount you pay back anytime you want to make a repayment is calculated on the current market value of your property, not the original value when you purchased it. For example, if you’re repaying a 25% loan and your home is currently worth £200,000, you would need to pay back £50,000.

Repaying: step-by-step guide

1. Instruct a RICS qualified surveyor to value your home. You can find a list of surveyors in Repaying your equity loan (PDF).
2. Fill out an Equity loans confirmation form (PDF).
3. If you’re selling your home, send the valuation and the form to us when your property is under offer. If you’re not selling, send them both right away.
4. We’ll check that the valuation is fair, then we’ll work out how much you owe and send a redemption statement to your solicitor.
5. The redemption statement contains everything your solicitor needs, so all they have to do is sign it. They’ll liaise with us and confirm when your loan has been repaid.

Equity loan guides

• Repaying your equity loan (PDF)
• Equity Loans home improvements (PDF)
• Remortgage or additional borrowing (PDF)
• Transfer of equity (change of ownership) (PDF)