In March 2015, the Government outlined a new Help to Buy ISA, here are the facts: It sees the Government adding £50 to every £200 first-time buyers manage to save towards a deposit for their first home.
The maximum amount you can contribute monthly is £200, with an initial deposit of up to £1,000. The Government will then add in 25% of what you pay in every month. There is no minimum monthly deposit required.
The scheme began on the 1st December 2015, and it will run for four years. You can open this account anytime within this four years. Once an account is opened there is no limit on how long you can save into the Help to Buy ISA. But you will stop earning a bonus from the government once you reach £12,000 and must claim the bonus by 1 December 2030.
It’s only available to first time buyers, and just like a cash ISA you must be aged 16 and over. If you’re buying with someone who isn’t a first-time buyer, they won’t be able to open one but you will be, as the account is available per person rather than per home.
You can use the Help to Buy ISA for house purchases up to £250,000, or if you are in London up to £450,000. This ISA is for a residential mortgage only and can either be for a new-build home or a second-hand home.
A maximum government bonus that can be achieved through the scheme is £3,000.
Some of the banks and building societies announced participating in the Government’s scheme are Barclays, Halifax, Nationwide, NatWest, Santander and Virgin Money.
You can only pay into one cash ISA in a tax year. You are not able to pay into both a cash ISA and a Help to Buy ISA at the same time.
The Help to Buy ISA can also be transferred into the Lifetime ISA once it is launched in April 2017…