Help to Buy ISA – First Time Buyers
Launched by the Chancellor at the March 2015 budget, the Help to Buy ISA is the government’s new initiative that seeks to help hard working individuals looking to purchase their first home.
In recent times, interest rates have remained low and this has proved to be an uphill struggle for those wanting to save for a deposit. As of the 1st December 2015, first time buyers will be able to deposit £200 per month into a Help to Buy ISA account which the government will top-up by 25% up to a maximum of £3,000.00.
Keen savers will be able to boost their ISAs by an initial £1,000 lump sum payment.
This will potentially result in a sizeable contribution towards deposits especially given that couples are able to combine their bonuses to make a total up to £6,000.
It is important to note however that the scheme is only available to those purchasing homes as their primary residence and it is only available where the purchase price does not exceed £250,000.00 (£450,000.00 in London).
The Government has set out simple steps that first time buyers should be aware of if they want to make use of the scheme;
1. The first time buyer should invest money in a Help to Buy: ISA account
2. This account can then be closed when the first time buyer is in a position to purchase their first home. The ISA manager will issue a closing letter.
3. The letter is to be passed to first time buyer’s solicitor.
4. The solicitor is then able to apply online for the government bonus.
5. The bonus is transferred to the solicitor, who will be able to utilise the money when completing the transaction.
First time property purchases can be a step into the unknown. At Crane & Staples, we offer a service tailored to your needs and aim to provide assistance every step of the way. If you require our services then please feel free to contact us at any time and we will be happy to help.