Help to Buy is a scheme set up by the UK government to help first time buyers get a foot onto the property ladder. It helps young people to purchase a home with a deposit which costs as little as 5% of the asking property asking price.
1. The government boosts savings in the account by 25%.
If you are saving money into a Help To Buy ISA account, then the government will give you 25% back on your savings. For example, if you save £200, the government will give you an additional £50. Within the first month of opening a Help To Buy: ISA, you can deposit a maximum lump sum of £1200 and add a further £200 (max) every month thereafter.
2. The minimum government bonus is £400
You must save at least £1600 to receive the minimum governent bonus of £400. The maximum government bonus is £3000 which means you should save no more than £12,000 in your Help To Buy: ISA.
3. You do not have to deposit money into your Help To Buy: ISA every month.
You can deposit up to £200 into your account every month but you do not have to deposit money every month. However, you cannot roll over the allowance. For instance, if you do not add any money into your account during January and March, this does not mean you can save £800 in April.
4. Help to Buy: ISA’s are only available to individuals.
This means, if you are planning to buy a home with another first time buyer, you must have a separate Help To Buy: ISA but you can use your combined savings for a mortgage deposit.
5. Help To Buy: ISA’s are available until 30th November 2019.
If you have opened a Help To Buy: ISA, you can keep the account until 30th November 2029 but you must claim your bonus by 1st December 2030.
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
- not have another active cash ISA open in the same tax year
To qualify for the government bonus, the property must:
- be in the UK
- cost less than £250,000 (or £450,000 in London)
- be the only home you will own
- be purchased with a mortgage
- be where you intend to live
Help to Buy cannot be used to purchase a second home, holiday home or a buy-to-let.
