The Help to Buy: ISA launched on 1st December 2015. Do you know how it could benefit you?
From 1st December 2015, first-time buyers can benefit from a new Help to Buy: ISA specifically aimed at giving a boost to people hoping to get on the property ladder.
Like regular Cash ISAs, the Help to Buy: ISA is a tax-free savings account, but as an added bonus, the Government will add 25% on top of whatever you save, up to a certain amount.
Sound good? We take a closer look at a few other things you should know about the Help to Buy: ISA.
Just because you’re not already scanning Rightmove for your dream first home, doesn’t mean you can’t start saving it using the Help to Buy: ISA. They are available to anyone who is a first-time buyer and meets the eligibility rules. However, you won’t get your bonus until you actually buy a property.
The Government pays out your 25% bonus on your closing balance when you are ready to purchase your property. You need to have at least £1,600 in the account to qualify, giving you a bonus of £400. Bonuses will only be paid out on balances up to £12,000, so £3,000 is the maximum.
It’s never been more expensive to get on the property ladder, so the younger you can start saving the better. You can open a Help to Buy: ISA from the age of 16.
Buying with your partner or a friend? Make sure you’re maximising your cash by each opening a Help to Buy: ISA – as long as you’re both first-time buyers. If you both save the maximum to qualify for the bonus, £12,000, you’ll get an impressive £6,000 towards your first home.
You’ll only qualify for the bonus if you buy a property for no more than £250,000, unless you’re buying in London where you can spend up to £450,000. Check out our House Price Index to see what this could buy you in different parts of the country.
From the moment your offer is accepted to the day you collect the keys to your new home, you’ll use a solicitor to take you through the conveyancing process. To qualify for the bonus, you must use a conveyancer registered with the Help to Buy: ISA scheme.
If you’re dreaming of a chateau in France or a beachside home Down Under then the Help to Buy: ISA probably isn’t for you. You only qualify for the bonus if you buy and live in a property in the UK.