Cash Bonus of Up to £3000 available for First Time Buyers! Open a Help to Buy ISA
First time buyers must bear in mind that with historically low interest rates repayments on their mortgage may well be less costly than monthly rent. Seeking out professional mortgage advice to help you model your affordability is always recommended and at The Mortgage Clinic we offer free mortgage planning appointments.
Raising the deposit for a house purchase is not however easy, and for those who are trying to get a foothold on the property ladder the Help to Buy ISA is extremely attractive. First time buyers receive a boost from the government towards their deposit. Under the Help to ISA first time buyers who open an account are eligible for a maximum bonus of £3,000. The minimum is £400.
Who is Eligible?
To qualify you must be UK resident and someone who does not and has never owned a home. You must also have raised 5% of the deposit.
How It Works…
The Help to buy ISA accounts are available to each first time buyer, not each household. This means that if you are planning to buy with your partner, for example, you could receive a government bonus of up to £6,000 towards your first home.
Help to Buy ISAs are available from a number of building societies and banks. You have to purchase the property with a mortgage but you do not however have to take out your mortgage with the ISA provider.
To make the most of the Help to Buy ISA means paying in for over four years or until you reach a £12,000 balance where you reach the £3,000 upper limit on the 25% government bonus.
One Help to Buy ISA can be opened per person. Those who are buying with a partner, provided they are also a first time buyer, can also open an ISA account and qualify for the cash bonus. The bonus cannot be used to pay other costs, such as legal fees. It can only be used towards the purchase price.
The maximum property price is £250,000
When Do I Get the Bonus?
When the Help to Buy ISA is closed the bonus is transferred to your solicitor who completes the purchase of your home using the full bonus amount.
Source: The Telegraph Personal Finance Section 5th May 2017