One of the government’s many methods to help assist first time buyers is the Help to Buy ISA.
The Help to Buy ISA is available from a wide range of banks, building societies and credit unions.
How to qualify
To qualify for a Help to Buy: ISA you must:
- be 16 or over
- have a valid National Insurance number
- be a UK resident
- be a first-time buyer, and not own a property anywhere in the world
- not have another active cash ISA in the same tax year
To qualify for the government bonus, the property you are buying must:
- be in the UK
- have a purchase price of up to £250,000 (or up to £450,000 in London)
- be the only home you will own
- be where you intend on living
- be purchased with a mortgage
In relation to the Help to Buy (HTB) ISA, there is a set fee of £50 plus Vat which solicitors can charge in order to deal with requesting the bonus.
In relation to the process involved in requesting the bonus, you will need to sign a first-time buyer’s declaration and then after exchange of contracts you will need to contact your bank to request a closing statement. Upon receipt of the closing statement the bonus can be requested by the Solicitor.
The First Time Buyer declaration requires to you to confirm the following:-
- That you are a resident in the United Kingdom
- That you do not own nor, have you ever owned any land whether ion the UK or abroad
- That you have not previously received a help to buy bonus
- That you to intend to occupy the property as your only or main residence
The bonus requires up to 5 days’ notice to be requested so a gap of at least this time will be needed between exchange and completion.
The bonus amount will be sent directly to the Solicitor upon completion. The minimum government bonus is £400 and so this means that you need to have saved at least £1,600 into your Help to Buy ISA before you can claim your bonus. The maximum government bonus you can receive is £3,000 and in order to receive that you need to have saved £12,000.
The bonus can only be used towards the balance of money you are putting in as part of the completion monies to purchase your fist home. The bonus cannot be used for the deposit due at the exchange of contracts, to pay for solicitor’s, estate agent’s fees or any other indirect costs associated with buying a home.
To obtain further information we would refer you to https://www.helptobuy.gov.uk/help-to-buy-isa/how-does-it-work
How to contact us
If you are a first-time buyer, please speak to Hodders Law on 0808 168 8677 so that we may assist you further.